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Tag: China

  • How to grow for Luxury brands

    How to grow for Luxury brands

    Luxury brands need to use new technologies and offer experiences for their customers, the second Luxury Society keynote event in Shanghai has been told.

    UCO Cosmetics CEO Arthur Zhang told the event that the early-stage eCommerce model of simply providing a platform for selling products online is dead.

    He said key technologies being experimented and improved upon in China include augmented reality, virtual reality and live-streaming.

    “The millennial generation in China, which already numbers about 300 million people, seeks experiences and emotional connection – they are not just bystanders,” DLG China partner/MD Pablo Mauron told the audience of more than 150 luxury-industry brand executives. “As a result, live-streaming has become a medium for them to express themselves.”

    He told how brands such as Maybelline, Montblanc and Swarovski are taking advantage of these new opportunities.

    Underlining the key message of the event that eCommerce is changing, CEO Thibault Villet of luxury fashion eCommerce platform Mei.com told how a live-streamed show in collaboration with TMall resulted in 65 per cent of the products featured quickly selling out.

    Meaningful data

    Social customer-relationship management (CRM) makes highly targeted messaging and engagement possible, the event was told by Four Seasons Hotels Asia Pacific director of marketing communications John Hamilton. He said the luxury hotel chain has been gaining meaningful data about its customers, which in turn has driven growth. In the past year, through trial-and-error and optimisation, the group has defined a CRM-led content strategy on WeChat.

    Celebrity and key-opinion-leader partnerships can make a big impact in China, said East Entertainment commercial director Qing Dai, who spoke of her experience of partnering luxury brands with appropriate celebrities. One of Easy Entertainment’s most successful was in linking up Cartier with singer/actor Lu Han.

    Baidu GM for East China Wan (Grace) Zhang said Cartier was the most-searched luxury watch brand among the generation born between 1990 and 2000, linked to Cartier’s collaboration with Lu Han.

    Other speakers at the event included Four Seasons Hotel Pudong (Shanghai) GM Arthur Ho, writer Casey Hall of Women’s Wear Daily, Digital Luxury Group founder/CEO David Sadigh and MD for China Pablo Mauron, Baidu senior project manager Di Fu and Sephora China digital manager Vanessa Qian.

    Attendees included representatives of Alexandre de Paris, Baume & Mercier, Bottega Veneta, Bulgari, Cartier, Chanel, Chaumet, Conde Nast, De Beers, Dior, Hublot, Loewe, LVMH, Marc Jacobs, Massimo Dutti, Michael Kors, Montblanc, Nars, Net-a-Porter, Nike, Sephora, Shiseido, Swarovski, TAG Heuer, Tiffany & Co and Vacheron Constantin.

    Luxury Society, published by Digital Luxury Group, is an online destination for luxury-brand executives covering digital and technology matters and with more than 40,000 members across 150 countries.

  • Japanese denim brand EVISU Buys Back the Retailing Rights in China for US$40 Million

    Japanese denim brand EVISU Buys Back the Retailing Rights in China for US$40 Million

    Japanese premium denim brand EVISU Group Limited announced the buy-back of the retailing and franchising rights for the China market.

    EVISU Group Limited, the parent company, has reinvested alongside Cassia Investments, a consumer-focused private equity fund, to buy back the interest from New Elegant Trading (Shanghai) Co. Ltd, the joint venture partner in China financially supported by IDG Capital. Acquisition consideration is US$40 Million. David Pun, Chairman and CEO of EVISU Group Limited, will remain the majority shareholder.

    David Pun expressed his excitement about this latest development, “The company made concerted efforts with its China joint venture partner over the past few years to establish brand awareness and secure a footing in China. We think this is an ideal time for the company to integrate its regional China business with headquarters to pursuit the brand’s global objectives in the coming years.”

    In the meantime, EVISU is seeking business expansion globally by forging distribution partnerships for the U.S. and Europe markets. The brand will step up product extensions like EVISUKURO, the latest athleisure collection, and maintain product exclusivity through focused management of wholesale distributors.

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  • First runway show for Max Mara China

    First runway show for Max Mara China

    Luxury Italian fashion house Max Mara hosted its first runway show in Shanghai yesterday.

    It is presenting its pre-collection for fall 2017, as well as a capsule collection conceived in collaboration with Chinese artist Liu Wei, who also created the set for the runway show.

    With the capsule collection, the label is test driving its “see now, buy now” strategy. The collection comprises 11 pieces in upmarket fabrics, inspired by dense urban landscapes. The items will be available from tomorrow in a selection of Max Mara boutiques worldwide, including Paris, and on the label’s website.

    Max Mara opened its first store in China in 1993 and now has 414 boutiques there, including 35 in Shanghai.

    The Italian group has 19 apparel brands, led by Max Mara and Max Sport. It achieved sales of €1.38 billion (US$1.45 billion) last year, with 60 per cent coming from abroad. The company employs 5692 people and has 2668 locations in more than 100 countries.

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  • YCH Group opens retail hub in Xiamen

    YCH Group opens retail hub in Xiamen

     

    The four-storey mall aims to cater to the burgeoning Chinese retail scene while strengthening the Xiamen’s status as one of China’s most popular tourist destinations.

    YCH Group — an integrated end-to-end supply chain management and logistics company in Asia Pacific — has launched its retail hub in Xiamen, China in an effort to support the Pilot Free Trade Zone project in the city.

    To be fully operational from today (15 December 2016), the four-storey facility aims to cater to the burgeoning Chinese retail scene. According to eMarketer’s latest findings, China has overtaken the U.S. to become the world’s largest retail market, with total sales of US$4.886 trillion this year.

    The retail hub will also play a key role to strengthen the status of Xiamen as one of the most popular tourist destinations in China. Xiamen Tourism Bureau revealed on 7 October 2015 that  Xiamen received 1.63 million tourists from home and abroad, and raked in 1.853 billion RMB in tourism revenue last year.

    “With the dynamic and growing retail sector in the country, we want to equip retailers with game-changing capabilities that help them simplify processes and optimise costs. This will enable them to remain competitive while simultaneously boosting trade and facilities investment for China with the Pilot Free Trade Zone,” said Koh Yong Seng, Operations Director of North Asia, YCH Group.

    The mall, which used to be Xiamen Port Development- YCH Logistics’ warehouse, is strategically located within the Pilot Free Trade Zone. It is in close proximity to both air and sea ports, as well as numerous famous hotels.

    Sam’s Club and Red Star Macalline will be the mall’s first two anchor tenants, occupying about 85 percent of the facility.

    Sam’s Club is a division of Wal-Mart, which offers an extensive inventory with exceptional value on famous-brand merchandise at “member only” prices for both business and personal use.

    Meanwhile, Red Star Macalline targets the rapidly growing middle class in China through the operation of malls that offer home improvement and furniture materials, including flooring, bathroom and kitchen fixtures, with approximately 18,000 well-known brands.

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  • Jollibee Foods quits China restaurant stake

    Jollibee Foods quits China restaurant stake

    “The divestment is part of the company’s intention to concentrate its resources on businesses with greater potential,” Jollibee said in its statement, essentially admitting the business was not performing to expectation.

    The company will now focus on “larger businesses in China”.

    SPW has grown from 34 stores to 71 under Jollibee ownership, mostly located in Nanning in Guangxi province in China’s south. The Philippine company expects to raise US$13 million from the sale, with installments staggered over two years.

  • China retail sales peak in November

    China retail sales peak in November

    China has reported November was its strongest month of retail sales growth for the whole year.

    While official government figures are usually greeted with a degree of scepticism by retail company executives, they are the only data available to build any sort of picture on the giant’s market’s trading fortunes.

    According to the latest data, total retail sales climbed 10.8 per cent representing the fastest pace since December 2015 and exceeding expectations of a 10.1 per cent rise.

    According to Reuters news agency, the figures were boosted by a higher than usual number of motor vehicle sales (During Alibaba’s 11.11 promotion, 100,000 new cars were sold) along with home appliances and cosmetics.

    Luxury retailers like Kering Burberry and TIffany are among those reporting improved fortunes in the mainland this year after a three-year long decline.

    “Part of that is due to the falling value of the yuan, which diminishes the appeal of spending abroad and encourages more domestic spending,” Wang Jianhui, an economist with Capital Securities in Beijing, told Reuters.

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  • Quest for franchisee for Focus Brands

    Quest for franchisee for Focus Brands

    Focus Brands is seeking franchisees to develop its Cinnabon and Auntie Anne’s brands in China as part of its international growth strategy.

    Founded in 1985, Cinnabon is a cinnamon roll bakery with 580 outlets in 52 countries. Auntie Anne’s, founded in 1988, is a soft-pretzel chain with more than 530 locations in 29 countries.“China is a priority market for us based on consumer insight research that shows our freshly baked products have a broad appeal,” says Focus Brands International president Nicolas Boudet.

    “Both brands have received numerous industry accolades, with Cinnabon being named a top-five quick-service brand in Technomic’s Millennials’ Favorite Chains report. Auntie Anne’s was recognised as a Top 50 limited-service restaurant brand by QSR Magazine.

    This year Cinnabon has opened 64 international locations with plans to add more than 70 next year. Auntie Anne’s has opened 89 international outlets this year and aims for 100 more next year.

    Other Focus Brands franchises include Carvel, McAlister’s Deli, Moe’s Southwest Grill and Schlotzsky’s.

    Based in Atlanta, Focus Brands runs more than 1300 franchised ice-cream shops, bakeries, restaurants, and cafes outside the US. It grew its total international system-wide sales by 10.5 per cent last year.

    Founded in Seattle, Cinnabon has more than 1200 franchised locations worldwide, primarily in high-traffic venues such as shopping malls, airports, train stations, travel plazas, entertainment centres and military establishments.

    At its more than 1600 locations internationally, Auntie Anne’s mixes, twists and bakes pretzels all day long in full view of guests.

  • Sunlight returns to retail

    Sunlight returns to retail

    Chief executive of Sunlight Real Estate Investment Trust (0435) Keith Wu Shiu- kee said the volatile period in the retail market at the start of the year has passed.

    Wu said though the local retail market was not performing well over the past two to three years but its impact on rents for shops in shopping malls was limited. He pointed out that rents for shops extending their rental contract in the REIT’s shopping malls went up 6.5 percent during the three months ended September 30. A slowdown in the retail market had not affected shops selling daily necessities, he said. He expected the retail market to continue to improve next year. Commenting on increasing demand for Hong Kong’s office spaces from mainland companies, Wu said it might increase the cost for purchasing offices.

    Meanwhile, he said the revamp of Sheung Shui Centre is nearing completion but admitted that the occupancies was not 100 percent.

    Retail spaces occupied by food and beverages shops in the mall has gone down following revamp, he said, but rents from the food and beverages shops have gone up by a double digit. Seperately, Lifestyle International (1212) said the total investment cost for its Kai Tak commercial project is expected to be about HK$13 billion.

    Lifestyle, operator of Sogo department store, acquired the first commercial site in Kai Tak development zone in November for HK$7.39 billion.

    The company said it intend to develop the site into two blocks of commercial buildings to provide spaces for both retailing and office use.

    Lifestyle planned to house a department store and other facilities which are complementary to the department store operations in the retailing portion, while the office space will be held partly for self-use and partly for leasing out.

    It expected the development to be completed before 2022.

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  • Spar China franchisor launches IPO

    Spar China franchisor launches IPO

    Jijiayue Group, the parent of Spar China franchisor Spar Shandong, has launched an IPO.

    Spar Shandong became Spar International’s first retail partner in China in 2004, and opened its first store in 2005 in the city of Weihai, north east China. Since then, Spar China has opened 360 stores with nearly 1 million sqm of selling space in eight provinces, employing over 30,000 people. It also operates eight distribution centres delivering across 50 cities.

    Jiajiayue issued 90 million shares, listing on the Shanghai Stock Exchange. Late last month, interest from investors saw the online portion of the IPO oversubscribed 4407 times and the share price rose 43 per cent on its first day of trading.

    The funds raised will be used to finance new store openings and upgrades of existing stores, developing distribution centres and logistics infrastructure and enhancing the existing technology and IT infrastructure.

    spar-china-ipo-image-2
    From left to right: Mr Ding Mingbo – Vice General Manager of SPAR Shandong Jiajiayue Group, Ms Fu Yuanhui – Executive Vice General Manager, Mr. Wang Peihuan – Chairman SPAR Shandong, Mr. Tobias Wasmuht – Managing Director SPAR International, Yoep Man – Managing Director SPAR China and Mr Zhang Aiguo – Vice General Manager.

     

    Tobias Wasmuht, MD of Spar International described the IPO as a significant milestone, not just for Spar Shandong, but for the wider Spar China family as well.

    “All at Spar are delighted to have contributed to the success of Jiajiayue. Over the last 12 years the company has continued to lead the way, working closely with the growing list of Spar Partners in China to grow and enhance the brand. Investor interest in today’s IPO is testament to the strength and vision of the company and its management team.”

    In addition to its partnership with Spar, Jiajiayue Group is involved in food processing, thye wholesaling of agricultural products and foreign trade business. In total it operates over 400 stores with a selling space of 900,000 sqm in 34 cities within Shandong province such as Weihai, Yantai, Jinan, Weifang, Qingdao, Linyi, Laiwu and Zaozhuang.

    The store formats cover hypermarket, supermarket, department store, neighbourhood store and discount store. The company has been recognised with a number of awards, including top 100 China FMCG Chain, Customer Satisfied Company in Shandong Province and Top Employer of China Retailing.

     

  • APT nearing 100% 4G take-up

    APT nearing 100% 4G take-up

    Taiwan’s Asia Pacific Telecom (APT) is nearing 100% take-up of 4G services among existing customers, and expects nearly all its subscribers to have migrated to 4G by the end of Q1.

    APT only has around 100,000 3G users left to migrate to 4G, around 6% of the operator’s total subscriber base. The remaining users are expected to upgrade in the next few months.

    In order to encourage migration and boost interest in the operator’s 4G services among new customers, APT has introduced a new line of plans that offer unlimited broadband and free domestic voice calls even to subscribers of Taiwan’s other mobile operators. The plan starts at TW$999 ($31.39).

    APT chairman Lu Fang-ming told the Taipei Times that the operator has reached the subscriber migration target set when the operator launched 4G two years ago.

    As the operator moves to the next phase, it plans to focus on expanding its customer base to improve ARPU.

    APT also recently announced a new home OTT video service to be delivered to Taiwanese customers in collaboration with Netflix, China’s iQiyi, movie distributor Catchplay and Taiwan Mobile’s myVideo, the report adds.

  • Apple Korea targets 15pc market share

    Apple Korea targets 15pc market share

    Apple Korea is going head on to Samsung on its home turf, on target to sell 2.9 million iPhones in South Korea this year, giving it a market share of about 15 per cent.

    At the end of last month it had sold 2.6 million iPhones, and is forecasting improved results for the year. Its operating profit has reached more than KRW800 billion (US$684 million) on revenue of KRW3 trillion, according to Yonhap News Agency.

    Sales of iPhones account for more than 75 per cent of Apple’s revenue in Korea, sources say. It launched the iPhone 7 in October with the opportunity to take share from market leader Samsung after its Galaxy Note 7 debacle.

    On top of that, the Cupertino-based tech company is building its first flagship retail store in Seoul, expected to be completed next November, right across the street from Samsung’s headquarters.

    Apple’s market share in Korea peaked at 33 per cent in the fourth quarter of 2014 following the launch of the iPhone 6, according to Counterpoint. Samsung and LG now have a combined market share of more than 80 per cent. LG had a 19 per cent market share in the second quarter of this year.

    South Korea and Japan, where the iPhone had more than a 50 per share for the three-month period ending October 30, are rare growth markets in Asia for Apple. Its iPhone shipments in China plunged 31 per cent to 7.5 million units in the third quarter, with market share falling to 6.2 from 10.3 per cent, according to Strategy Analytics.

    Apple reportedly reduced orders from component suppliers for its iPhone 7 models early this month because of demand being weaker than expected in many markets, including China.

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  • Metro China changes track

    Metro China changes track

    Surging property costs and a changing consumer landscape have forced German retail giant Metro Group to change its approach to the market in China.

    In the 20 years since it opened its first Metro China wholesale store in Shanghai, the retailer has had a rigid policy of building its Metro Cash & Carry stores rather than renting.

    Now, in Wuhan, the capital of central China’s Hubei province, Metro is trying to redevelop one of its stores into its first shopping complex.

    “We are partly turning to asset-light from asset-heavy,” says expansion director and head of project development for China Geoffrey Guo. Metro Jinjiang Cash & Carry, a JV with Shanghai-based Jinjiang Group, has partnered with a local developer to build the Wuhan project, and has transferred property ownership to the developer. The plan is to expand the outlet into a 167,000 sqm German-themed town comprising a mall, office buildings and apartments.

    The complex will include a smaller cash-and-carry shop, and Metro will buy back the store ownership. Meanwhile, it will participate in running the complex and try to introduce German brands through tenant leasing.

    “Some of our land used to be in remote areas, but after a decade or two it became the city centre,” says Guo, “so we need to negotiate with local governments and change our plan.”

    City plans

    As well as Wuhan, Metro China is considering redeveloping some of its stores in Shanghai and other cities into five-star hotels, office buildings or neighbourhood centres.

    Metro has grown slowly in China compared to its peers, opening 86 stores in 58 cities so far, about two-thirds of them owned by the company. In comparison, US-based Walmart has 423 stores in China.

    With the rise of eCommerce, the German retailer has started renting more stores in the past few years to enable quicker expansion. It also launched its first two My Mart convenience stores in Shanghai this year.

    “The demand for supermarkets is not so strong in places like Shanghai, where convenience stores are thriving,” says Guo.

    My Mart offers Metro’s exclusive imported products, private-label lines and fresh fruits, as well as about 100 ready-to-eat items. Metro plans to roll out the concept to other cities in China through franchise.

    While Guo says Metro’s focus will always be its wholesale stores, the company is seeking to open more stores in western Chinese cities such as Xi’an and Zhengzhou.

    Metro’s sales in China climbed 17.4 per cent to €2.662 billion (US$2.8 billion) in the year to September 2015.

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  • Tourists visiting Singapore chase bargains, not baccarat

    Tourists visiting Singapore chase bargains, not baccarat

    Research from HSBC shows a growing number of Chinese tourists visiting Singapore fuelled a 44 per cent increase in retail spending in the first half of this year, versus the same period last year. That put retail ahead of casinos in terms of tourist spending for the first time in five years.

    The number of  Singapore-bound Chinese tourists totalled about 2.1 million in 2016 – twice the number of 2009, the year before the country opened the first of its two casinos.

    Erwan Rambourg, London-based global co-head of consumer and retail research with HSBC, said Chinese, Indonesian and Indian visitors were the top three spenders in the second quarter of 2016, accounting for 40 per cent of total tourist spending. A quarter of spending went on shopping – up from just 18 per cent in the same period last year.

    Last year, Chinese spent S1.15 billion in Singapore stores – compared with just $175 million spent by Indians and $112 million by Japanese. But they spent less than any other nationality on food and accommodation.

  • Hanon Systems Expands Engineering Capability in China

    Hanon Systems Expands Engineering Capability in China

    Hanon Systems, a leading global provider of automotive thermal solutions, is enhancing its ability to serve vehicle manufacturers in China by opening a new engineering center in Shanghai.

    Located in Shanghai’s Songjiang district, the new 3,612 square meter multi-story facility will serve as the engineering epicenter of technical collaboration for application engineering and system evaluation supporting Chinese automakers and global vehicle manufacturers operating in China.

    “Supporting customers is a top priority and China is an important market to Hanon Systems,” said In-Young Lee, president and chief executive officer of Hanon Systems. “We are pleased to open this new engineering center in Shanghai to provide automakers with local technical expertise and testing capability to better support the growing China market.”

    The engineering center also is equipped with state-of-the-art test equipment to provide in-house design verification, product validation and in-process testing. Specific test capability includes noise, vibration and harshness (NVH) evaluation; air handling performance and durability of heating, ventilation and air conditioning modules; and thermal system component testing for electric vehicles.

    “Hanon Systems is well-positioned to support the demand for new energy vehicles (NEV) in China with a suite of products that are proven with global vehicle manufacturers and designed specifically for NEV architectures,” said Dr. Kwangtaek Hong, chief technology officer of Hanon Systems. “This new engineering center is a testament to our commitment to support the China market and the NEV trend.”

    Hanon Systems is relocating its Shanghai technical staff from an existing site approximately 25 kilometers in distance to the new facility in the Songjiang district, which has the capacity to accommodate additional resources to support growth based on business and customer needs.

    The Shanghai center is one of 14 engineering locations supported by four global technical centers that are responsible for developing advanced technologies, core product development and global standardization of new technologies. Hanon Systems’ global technical centers are located Daejeon, Korea; Kerpen, Germany; Nový Jičín, Czech Republic; and Van Buren Township, Mich.

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  • Tag Heuer sales buck watch trend

    Tag Heuer sales buck watch trend

    Tag Heuer sales have soared as the LVMH-owned luxury watch brand defies the downturn in the Swiss watch industry.

    And now the company is eying a greater presence in China, undeterred by the routing of the luxury retail market in Hong Kong.  It has opened 60 new points-of-sale in Greater China this year.

    In an interview with Reuters, CEO Jean-Claude Biver said sales for the brand have risen more than 10 per cent so far this year – and is confident more growth is ahead. That contrasts with a 10 per cent sales plunge just two years ago.

    He cites new models and a smart watch for the improved fortunes, with the most growth in the company’s core US$1000 to $2000 price bracket.

    Tag Heuer’s remarkable growth has come as Swiss watch exports fell 11 per cent year-to-date.

    “For us, China is a country where historically we were not very present, so it is huge opportunity,” Biver told Reuters.

    “We are investing massively in China while the others are cutting their investments,” he said.

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