Tag: China

  • Online China luxury goods mall expands

    Online China luxury goods mall expands

    Xiu.com, an online China luxury goods mall, has raised another US$30 million in funding, according to 36kr.

    The investment was led by Jardine’s, followed by KPCB China and others.

    Founded in 2008, Xiu specialises in high-end clothing, footwear, bags, accessories, and cosmetics from international brands. Headquartered in Shenzhen, it also has offices in fashion capitals like New York, San Francisco, London, Milan, and Hong Kong. The store has over 600 brands, and at least 200 of them are exclusive to Xiu in China.

    Xiu’s investment comes just days after French luxury goods retailer Kering, parent of Gucci and Yves Saint Laurent, amongst others, filed a lawsuit against China’s biggest eCmmerce company, Alibaba, alleging it is profiting from the sales of counterfeit goods in wholesale quantities on its Taobao site.

    Xiu.com says it will use the new funds to create a better shopping experience, improve its supply chain, and strengthen international ties.

    Founder Jiwen Hong says Xiu’s strength lies in the relationships it has with brands. By going directly to the brands and cutting out middlemen, it can offer better prices than competitors. 36kr says most items on Xiu sell for less than the retail cost in Hong Kong and the US.

    The startup has 10 million registered users with a repeat purchase rate of 85 per cent. The average customer spends about RMB 1,500 (US$242) per purchase.

    In 2012, US auction site Ebay launched a joint venture with Xiu to list products on a subdomain of Xiu’s site. That collaboration has since closed shop.

  • Esquires Espresso seals Hunan partnership

    Esquires Espresso seals Hunan partnership

    New Zealand-listed Cooks International Meals has signed a three way partnership settlement with Shenzhen-listed retail and property big BuBuGao Group to develop 30 Esquires Espresso shops in Hunan by 2020.

    The three way partnership cements China’s place as Esquires Espresso’s quickest rising worldwide territory and lifts the whole variety of deliberate shops within the nation to a minimum of 150. It additionally additional advances Cooks’ aspiration for Esquires Espresso to be working 800 shops all over the world by 2020.

    * BBG chairman Wang Tian (left) and Esquires Espresso China MD Ellen Zhang toast their new China three way partnership.

    BBG, or Higher Life, has taken a 49 per cent stake within the three way partnership and can progressively contribute property in its buying malls which might be based within the Hunan province. Cooks, with a 51 per cent stake within the enterprise by way of its wholly-owned Chinese language grasp franchisee Beijing Esquires Administration Co, will develop and handle the shops.

    BBG has annual revenues of almost CNY12.three billion, (NZ$2.7 billion), employs over 70,000 individuals and operates over 373 shops within the Hunan, Jiangxi, Sichuan, Chongqing, Guangxi, and Guizhou provinces, together with 156 supermarkets and 29 purchasing malls. It additionally has a CNY10 billion property portfolio and is lively in on-line commerce and finance.

    Cooks International Meals government chairman Keith Jackson stated the brand new deal is additional endorsement of the potential for Esquires Espresso’s artisan fashion Natural and Fairtrade model to develop quickly in Chinese language markets.

    “The enterprise is a continuation of our technique to drive progress in China by partnering with vital home companies that may present the assets, retail experience and native information which are pre-requisites for fulfillment within the area. These capabilities, coupled with a Chinese language Esquires Espresso administration staff that understands the right way to translate the model’s distinctive tackle New Zealand café tradition into home settings, provides us nice confidence within the potential of the enterprise to develop.”

    BBG chairman Tian Wang stated that with demand for branded espresso rising in China at charges that outstrip progress charges in the remainder of the world, Esquires Espresso will fill an essential a part of the retail combine throughout its buying centres.

    “Its Natural, Fairtrade and artisan positioning makes it an aspirational vacation spot for a broad cross part of the inhabitants. We’re assured the brand new enterprise will generate appreciable worth for the BuBuGao group.”

    Cooks now operates 21 shops in China using 130 individuals, making it the third largest New Zealand non-Authorities employer within the Peoples’ Republic. It’s now concentrating on a footprint of greater than 150 shops in China by 2020.

    Earlier this yr, Cooks acquired the Esquires Espresso Chinese language grasp franchisee Beijing Esquires Administration and as a part of that transaction, one of many former house owners, Yunnan Metropolitan Funding Firm (YMCI) took a 15.75 per cent stake in Cooks.

    Cooks additionally has an identical three way partnership with Jiajiayue Group (JJY) grocery store chain to develop 50 shops within the Shandong province. JJY is among the largest corporations in Shandong, using virtually 30,000 employees and working greater than 550 supermarkets.

    “We proceed to hunt companions to increase our foot print in different areas and our administration group, led by expatriate Chinese language-New Zealander Ellen Zhang, is already in dialogue with a number of different events,” Jackson stated.

    Cooks owns the mental property and grasp franchising rights to Esquires Espresso Homes worldwide excluding New Zealand and Australia. Following the signing of a brand new grasp franchise settlement for Egypt final week, the corporate is now rising in 13 separate territories around the globe and it’s in discussions to increase its grasp franchise community additional.

  • Chow Tai Fook takes on landlords

    Chow Tai Fook takes on landlords

    Hong Kong jeweller Chow Tai Fook is flexing its muscle in a softening retail rental market, in search of lease cuts of as much as 20 per cent.

    The listed firm says some 30 leases throughout the territory will come up for renewal later this yr and the corporate will probably be in search of reductions within the wake of a difficult retail market which has seen gross sales plunge in some luxurious classes.

    In an interview revealed on Bloomberg on-line, MD Kent Wong stated the corporate has already been granted reductions of between 10 per cent and 20 per cent in renewal negotiations this yr, however he didn’t reveal the variety of leases concerned.

    He advised Bloomberg that circumstances in 2015 are “very particular”.

    “We’re demand pushed; we anticipate we will have a 20 per cent rental discount.”

    Chow Tai Fook has reported a fall in same-store gross sales in Hong Kong and Macau of 26 per cent within the first quarter of this yr – the fifth consecutive quarterly fall.

    Wong stated his firm might shut some shops this yr – singling out its Peak outlet for instance.

    The jeweller has 90 shops in Hong Kong, interesting largely to Mainland Chinese language vacationers. However customer numbers from China have been falling, and people nonetheless coming are much less prosperous than the standard guests of previous years. These with larger disposable incomes have began travelling additional afield, many spooked by the Occupy Central protests of the second half of final yr.

    The mainland authorities’s clampdown on present giving has additionally affected gross sales of upper priced luxurious items in Hong Kong.

    Regardless of a lower in complete retail gross sales of two.three per cent in Hong Kong in the course of the first three months of 2015, Wong expects a restoration later within the yr.

    “The market basically wants six months to at least one yr to restructure the product combine catering to the altering style of consumers,” he advised Bloomberg.

    “We stay optimistic about Hong Kong within the mid- to long-term.”

  • Nuance India unveils new duty-free idea

    Nuance India unveils new duty-free idea

    Travellers flying out of Kempegowda Worldwide Airport in Bengaluru, India might be handled to a stroll of nostalgia and wealthy South Indian custom in Nuance’s new Obligation Free Retailer on the departure lounge.

    Nuance India has opened a 900 sqm purchasing expertise which it says – aside from providing the perfect worldwide merchandise and the perfect costs – will showcase Bengaluru’s opulent heritage and tradition.

    “We consider journey is all about new experiences and airports are a touch-point for the travellers to work together with the area,” stated G V Sanjay Reddy, MD of Bengaluru Worldwide Airport.

    “Our try is to make it possible for each business area on the airport supplies a way of place and embodies the native tradition, heritage and aesthetics. The Nuance group has carried out justice to our imaginative and prescient and developed the brand new Obligation Free expertise to fulfil a memorable buying expertise to our passengers.”

    Anirban Dutta Chowdhury, nation head of Nuance India, stated the brand new purchasing expertise “represents the town and showcases an eclectic mix of conventional values coupled with world class design.”

    That design consists of unique Chettinnad pillars from Kalaikudi, kolam-inspired patterns and jhumka-influenced lighting.

    “Our purpose was to make a retailer based mostly on our international Obligation Free Retailer idea, that might be anyplace on the planet, however is proud to be at KIAB and we really feel we now have been capable of ship that to the discerning Bengaluru traveller.

    “The brand new retailer will supply a world boutique-style atmosphere, with a mix of know-how together with an intimate and welcoming environment, which can elevate the buying expertise of the travellers to the subsequent degree.”

    The shop shares perfumes, cosmetics, liquors, confectionaries, electronics and extra and can later introduce trend and equipment.

    “The target is just not solely to offer a singular and unique buying expertise but in addition to supply unmatched offers. Bengaluru Obligation Free has launched a Merely Cheaper Pricing Technique, with assured financial savings in comparison with different regional worldwide airports,” Chowdhury stated.

    Your complete product vary can also be obtainable on-line. Passengers can merely e-book on the firm’swebsite and gather their purchases from the airport retailer.

  • Cities stunt China retail gross sales progress

    Cities stunt China retail gross sales progress

    China retail gross sales progress is strongest in rural areas, with city space progress persevering with to say no.

    China’s Nationwide Bureau of Statistics introduced Wednesday that retail gross sales general grew 10 per cent in April, year-on-year, to 2.24 trillion yuan, or US$366 billion.

    The official determine dissatisfied economists who had been forecasting a 10.5 per cent rise. Progress measured within the first 4 months of the calendar yr was 10.four per cent.

    A lot of the injury seems to be being accomplished in city areas.

    Yr-on-year progress in rural areas was 11.four per cent in April and 11.5 per cent for the 4 months.

    However in city China, April progress was simply 9.eight per cent, and 10.2 per cent for the complete yr up to now.

    Different financial indicators, nevertheless, have been solely barely extra encouraging. Industrial output rose 5.9 per cent in April, in contrast with 5.6 per cent in March. Economists had projected six per cent.

    Fastened asset funding grew 12 per cent over the primary 4 months, under predictions of 13.5 per cent.

  • China a standout for Estee Lauder

    China a standout for Estee Lauder

    China is certainly one of international luxurious cosmetics enterprise Estee Lauder’s strongest markets, with internet gross sales up 14 per cent final quarter and a lot of the firm’s manufacturers displaying double digit progress.

    Apart from the model which bears its firm identify, Estee Lauder owns Clinique, MAC, Jo Malone and Bobbi Brown, (one in every of whose Hong Kong shops is pictured above).

    Complete China gross sales rose in “the excessive double digits” in accordance with Estee Lauder’s quarterly outcomes. Whereas skincare merchandise dominated Chinese language gross sales, make-up merchandise are rising in reputation.

    Hong Kong gross sales, in distinction, have been down because of the a lot documented altering demographics of mainland Chinese language visiting the territory and final yr’s Occupy Central protests.

    Mainland China progress was particularly robust for Clinique and thru all channels together with Sephora, department shops and monobrand outlets. On-line gross sales doubled.

    “We consider that China might [account for] 20 per cent of our enterprise in the long run,” CEO and President Fabrizio Freda stated in an earnings convention name, a transcript of which is offered on-line by TheStreet.

    “We’re the start of the journey in China the place we’re very nicely superior within the US.”

    On-line, Estee Lauder has six model web sites in China and 4 shopfronts on Tmall.

    “Estee Lauder is the primary status magnificence model on Tmall and we’re excited that La Mer turned our fourth model on the platform a couple of weeks in the past,” added president of ELC on-line, Dennis McEniry.

    “All 4 of our manufacturers on Tmall are enormously exceeding our expectations, and we plan to launch further manufacturers there within the close to future.

    “We’re happy with the expansion in China. We’re going to greater than double our enterprise this yr,” stated McEniry.

    Globally, and throughout all channels, Estee Lauder’s internet gross sales rose eight per cent on a continuing foreign money foundation, exceeding the corporate’s expectations by multiple per cent.

    Getting into the ultimate quarter of the present monetary yr, the corporate expects gross sales to extend by between six and 7 per cent for the complete yr.

  • Prada China opens Wuhan retailer

    Prada China opens Wuhan retailer

    Prada China has opened a brand new retailer in Wuhan, inside the distinguished Worldwide Plaza purchasing centre.

    The 2-level, 950 sqm retailer area, designed by architect Roberto Baciocchi, homes the ladies’s and males’s ready-to-wear, leather-based items, equipment and footwear collections.

    The exterior facade pays tribute to artist Carlo Cruz-Diez.

    The massive entrance, mild bins and home windows are inserted into the decrease a part of the facade, which is clad in black granite and topped by an imposing gold and steel-coloured aluminium construction backlit to create a singular kinetic impact each day and night time.

    General, the facade stands 10 metres tall and stretches roughly 50 metres in size. The interior facade, the place the second entrance to the shop is situated, can also be clad in black granite.

    The inside is designed as a succession of areas, every that includes a unique environment.

    The doorway contained in the mall, outlined by the signature black-and-white marble chequered flooring, opens on an space housing the ladies’s leather-based items and equipment collections. Inexperienced fabric-clad partitions with Prada’s iconic cut-in niches with polished metal profiles outline the area.

    Inexperienced velvet sofas characterise the world devoted to ladies’s footwear.

    The ladies’s ready-to-wear assortment is showcased in an area outlined by inexperienced fabric-clad partitions and clear perspex show models.

    The lads’s leather-based items and equipment collections are set in polished metal show instances inserted into alcoves wrapped in black marble with inexperienced fabric-clad backdrops.

    The area devoted to the lads’s ready-to-wear and footwear collections is characterised by ebony floorboards and partitions, chocolate brown carpeting and cotto-coloured leather-based sofas. Polished metal show instances and counters with drawers coated in colored saffiano leather-based full the furnishing.

    Prada says it admires French-Venezuelan artist Carlos Cruz-Diez, whose paintings served as a place to begin for the design of the facade.

    The Prada boutique is situated in Wuhan Worldwide Plaza, 690 Jiefang Ave, Jianghan, Wuhan, Hubei.

  • Disney China to open international flagship

    Disney China to open international flagship

    US leisure icon Walt Disney will open the world’s largest Disney retail retailer in China subsequent week.

    The 5000 sqm Disney Retailer Lujiazui is described as a “state-of-the-art” retail area that includes Disney merchandise.. However only one fifth of the area – 1000sqm – will show merchandise on the market, with the remaining created as an outside plaza and a Disney expertise.

    Disney China government VP and MD Stanley Cheung, who signed the contract for the shop again in 2013 stated the model needed to mix the retail idea with “storytelling, enjoyable and innovation”. He promised a vacation spot which would offer households with a singular leisure vacation spot “that includes its best-loved tales and characters”.

    Households and youngsters will be capable of work together with characters from Disney, Star Wars, Marvel and Pixar.

    “The flagship Disney retailer will function the most important and most numerous assortment of Disney merchandise by native and worldwide designers,” stated Cheung.

    In the meantime, Shanghai’s new Disney Resort is underneath development with a gap date scheduled for the primary half of 2016.

  • Huawei Ingenuity to Power ‘Smart Cities’

    Huawei Ingenuity to Power ‘Smart Cities’

    Shenzhen-based telecommunications company Huawei has transformed itself into an information and communication technology giant, and now intends to boost its business in Indonesia’s government sector by helping to build smart cities, with services for industry and finance among a host of others.

    If you still underestimate Chinese technology — which in the United States has often been accused as a cover for spy tools — now is the time to change your mind. There was good reason to be skeptical in the past, but the former telco operator has transformed itself into a gigantic information and technology (ICT) industry with a range of services and competitive prices.

    Some years ago Huawei sold only phones and wireless equipment but since then it has expanded to become an important player in ICT. Not only does it have a wide range of products, but it also concentrates on creating value and providing solutions in the entire range of modern digital life applications.

    In Indonesia, Huawei’s technology is inside the wireless 4-G LTE Bolt which provides seamless internet access.

    Globally, the company booked $46 billion in revenue last year, with the Indonesian market contributing about $1.3 billion, a figure expected to increase to $1.5 billion this year.

    Its new Bandung Smart City project, launched in conjunction with the recent Asia Africa Conference, represents an important step forward. The project is being developed as a “safe city” concept.

    Huawei along with state-owned telecommunications giant Telkom has built a command center monitoring cameras throughout the city.

    This program will be further developed into a “smart city” project that aims to give maximum services to the city in a range of areas.

    At the command center at the mayor’s office, for example, banks of monitors show what is happening across the city, assisting with the direction of traffic, guaranteeing a clean city and helping to stop crime.

    Bilateral momentum

    Sheng Kai, chief executive of Huawei Indonesia Tech Investment, is strongly optimistic about the Indonesian market.

    “Relations between Indonesia and China have reached the best momentum at this moment, which will allow Huawei’s business in Indonesia to make outstanding achievements in the future, through the products and solutions that Huawei can bring in,” Sheng says.

    The Chinese ICT company is cooperating with more than 250 organizations — vendors, suppliers and others — and sees the government sector, the banking industry and energy as its target market. Products will include simple gear like switches and routers through to storage and data-center business, with long-term evolution (LTE) for mobile applications.

    While the technology may be similar to that offered by other vendors, Huawei believes it has competitive advantage the speed of services and response.

    “We are open for cooperation with varied organizations to produce devices or any other joint venture,” Sheng says.

    In the financial sector Huawei has a reputation for helping banks to tackle data management, varied internet and mobile banking services at high speed.

    It recently helped Bank BJB to lower costs and improve delivery speed, an achievement other vendors had not been able to provide.

    For China’s Merchant Bank, the company helped install a big data system.

    “Big data is challenging, so we try with Huawei’s expertise that comes from our big expenditure in research and development to help banks for example build hubs, deliver bank services in omni-channel systems with other banks at low budget,” says Lance Zhao, enterprise business solution manager for Indonesia.

    He adds that reliability of the technology make it possible for banks to service millions of customers with a variety of banking services.

    Consumer trend

    While its carrier business or network service is expanding through cooperation programs with a number of organizations, Huawei also plans to target consumer goods products with low-end smartphones Ascend Mate7 and Ascend P7. The P8 will soon join the range with an initial launch in London.

    “With estimated smartphone sales of 30 million units last year, 60 percent of which were low-end products, I am confident we can take a share of about 10 percent in the  coming years with smartphone devices,” Sheng says.

    Sales of wireless modems with its Bolt product in cooperation with Lippo Group, a Jakarta Globe affiliate, have been outstanding this year, at about 1 million units in the first quarter. With hundreds of retail outlets in big cities, Sheng believes the 10 percent growth target is realistic.

    As consumer sales rely strongly on branding campaigns, Huawei will spend up on media this year and plans to sponsor popular sporting events in Indonesia.

    “We are working hard to evaluate sports as crowd-making events that will help boost our brand in Indonesia,” says Indonesia Huawei brand ambassador, Yunni Christine, adding that some major European football league clubs are also being sponsored by the brand.

    ‘Smart cities’

    The Indonesian government aims to develop more than 200 “smart cities” where technology will be a critical element.

    The Bandung Command Center is the forerunner of what the Huawei hopes will be many more such projects in a continuing partnership with Telkom. In addition to providing technical assistance, the project also provides Huawei with the chance to engage with the government and help it increase public service quality.

    Huawei has spent about $25 billion on research and development across the globe in the past decade. R&D was hot-wired into the company’s DNA from the day it started, Sheng says.

    Human resource development is another strong emphasis and in Indonesia is represented by a program to help build a research center at the Bandung Institute of Technology.

    As cloud computing is also increasingly important, Huawei is engaging with various organizations, including Telkom’s Sigma, to build data centers. The service concentrates on the development of cloud architecture to ensure maximum efficiency in data management for clients.

    The company also emphasizes the trustworthiness of its products, despite being accused of acting as an electronic spy agency by the US government.

    “We are present in more than 170 countries and comply with all local government laws and regulations,” Sheng says.

  • Evergreen to open children’s fashion stores

    Evergreen to open children’s fashion stores

    Evergreen International has secured brand rights to greater China for a portfolio of high profile childresnwear brands.

    Until now, a specialist in menswear, Evergreen targets the upper-middle and high-end segments of mainland China’s market.

    Now the group has secured the rights to Roberto Cavalli Junior, Simonetta and Diesel Kid to distribute children’s wear and accessories in mainland China, Hong Kong and Macau.

    It has also signed a preliminary agreement with Rykiel Enfant under Sonia Rykiel regarding the proposed distribution of that brand’s children’s wear and accessories in the same markets.

    Separately, Evergreen has signed a letter of intent with Fendi Kids and is currently evaluating opening Fendi Kids monobrand shops and stores-in-stores in Mainland China.

    Last August, the group opened a Roberto Cavalli Junior store at Ocean Terminal in Hong Kong’s Harbour City. The group plans to open about nine new stores to introduce premium brands of children’s wear and accessories into the first- and second-tier cities of mainland China in the first half of this year.

    The locations will include the shopping malls in Chengdu IFS, Qingdao MixCity, Shenzhen MixCity and Qingdao Hisense Plaza.

    It will also open four retail stores for children’s wear and accessories at the shopping mall of the Galaxy Macau resort in the first half of 2015.

    Evergreen says it will continue to negotiate with shopping centre owners with a view to opening more stores in Hong Kong, Macau and first and second tier cities in the mainland in the second half of 2015.

    Chan Yuk Ming, chairman and executive director of Evergreen, said the company is in discussions with other international premium fashion brands about the retailing and wholesaling of their children’s wear and accessories in Hong Kong, Macau and Mainland China.

    “We believe the group’s new business segment of high-end children’s wear and accessories will further diversify the portfolios of products and brands of its businesses of apparel and accessories, and will leverage the foundation of its existing menswear business, thus will be benefit to the company and its shareholders as a whole.”

    Evergreen currently owns and manages V.E. Delure and Testantin, targeting the markets for high-end business formal and casual men’s wear, the upper-middle fashion casual men’s wear and the high-end children’s wear.

    The group’s strategy is to open self-operated stores in key cities, while penetrating the markets of slower development through distributors. To cope with business expansion and raise operating efficiency, the group has strategically used a combination of self-operated retail stores as well as distributors of varying sizes to cater to different stages of development and target markets for each of its brands.

    As at December 31 2014, the group had 177 self-operated stores and 191 franchised stores in 30 provinces and autonomous regions, covering 171 cities.

  • Ambitious plan for Playboy China

    Ambitious plan for Playboy China

    Playboy is using its massive brand awareness in China to drive an expansion of its apparel range and enter new retail categories.

    US-based Playboy Enterprises has signed a new 10 year licensing agreement with Handong United to manufacture and distribute an expanded assortment of men’s and women’s fashion apparel, including casual fashion apparel, formal and casual footwear, and accessories, such as belts, bags, backpacks, wallets, and travel luggage. Leveraging Handong’s broad distribution network, Playboy is expected to further expand beyond its current reach from 3100 retail touchpoints in China’s mainland to 3500.

    Playboy China boasts a 97 per cent brand awareness among Chinese consumers according to research house Penn Schoen Berland.

    “We’re proud of the fact that the Playboy brand has achieved household status as the one of the most recognised and popular brands in the world’s leading retail market,” said Scott Flanders, CEO, Playboy Enterprises.

    “To achieve this leadership position without ever having a media entity in China is a testament to the tremendous power of our brand. China is one of our most important markets and we’re committed to working with the highest calibre of partners to develop premium quality products to connect our brand to the future generation of Chinese consumers.”

    Playboy has been building its business in China for 20 years – without any of the printed or digital products it may be best known for in its US home market. In China it is purely an apparel brand and has licensing deals for other products.

    Playboy China generated US$5 billion in retail revenue over the last decade and last year achieved $1.5 billion in retail sales worldwide, more than one-third of that in China. The company wants to achieve revenues of $10 billion during the course of its new partnership with Handong United.

    The brand continues to generate momentum through its portfolio of long time partners in apparel, footwear, luggage and accessories, who actively market the brand through its Physical and VIP sub-brands, which have 1000 and 180 points-of-sales respectively.

    “Playboy has demonstrated success in building a loyal consumer base by introducing a variety of modern apparel and accessories with a renewed focus on attracting a younger male and female consumer base,” said Matt Nordby, president, global licensing and chief revenue officer with Playboy Enterprises.

    “We’re enhancing our licensing portfolio with long-term, brand-enhancing partners, and Handong United is a partner that can deliver a premium and superior product quality. We look forward to teaming with Handong to design and create new products to further grow our China presence and reach the younger fashion-conscious Chinese consumer.”

    Xiaojian Hong, executive officer of Handong United described Playboy as “one of the most famous and treasured brands in China” and a “must-have fashion choice” for men and women across the Mainland.

    Elsewhere in Asia and beyond, Playboy has been expanding its existing audience base and attracting a new generation of consumers by revamping and refining its licensing portfolio, partnering with Lane Crawford in Hong Kong, Beijing and Shanghai, Isetan in Tokyo and Marc Jacobs globally.

  • Esprit positive as network shrinks

    Esprit positive as network shrinks

    Fashion retailer Esprit continues to cull its retail network, but despite reduced sales is confident its turnaround program is on track.

    In the third quarter to March 31, the Hong Kong-listed company’s turnover fell 25.5 per cent in Hong Kong dollar terms to HK$4.51 billion, or 12.2 per cent in local currencies where it trades. The Hong Kong figure has been exaggerated by a 17.7 per cent depreciation in the Hong Kong dollar-euro exchange rate.

    Retail turnover in Asia Pacific grew by two per cent year-on-year in the third quarter, despite a 2.6 per cent reduction in net sales area, or 20 fewer company-owned stores.

    Over the last 12 months Esprit has reduced the number of Asia-Pacific stores supplied by its wholesale division by 40 per cent, or 188 stores.

    Wholesale turnover in Asia Pacific thus declined by 8.8 per cent year-on-year in local currency (compared with a 49.3 per cent reduction in the first half of the year). Esprit says this improvement was mainly attributable to the success of its special return agreements with wholesale partners in China which helped to clear considerably aged inventories in the same period last year. That, in turn, has resulted in an improved order intake for the third quarter.

    “In the third quarter, the Transformation phase continued to make good progress,” Esprit said in a stock exchange filing.

    “Our leaner supply chain maintained its positive impact on our sourcing costs, enabling us to reinvest the savings to further improve the value-for-money of our products. Consequently, the new collections developed under the Vertical Model, which were available in stores since February 2015 have received a more positive response.

    “While this favorable response is encouraging, it is too early to assess the full impact of the new products on our sales given their short time in the market.”

    Esprit said to drive sales development and support its sustainable growth, the company will be increasing its marketing efforts and implementing an ambitious omni-channel model to enhance the customer experience across its multiple distribution channels.

    “The savings from a leaner supply chain are also driving a year-on-year improvement of our gross profit margin, which is key for the profitability of the company.

    “We remain fully confident that our current strategies will enable us to turn around Esprit and to establish a strong foundation for future long term growth.”

    Esprit concluded by saying it was encouraged by improved sales of its new collections which went on sale from February this year.

    “Retail turnover for the months of February and March 2015 declined year-on-year by 2.9 per cent in local currency – better than our square meters reduction.

    “The positive performance in Asia Pacific, where we did not face the same issues from Autumn/Winter 2014 season, was attributable to  better availability of merchandise in stores as a result of improved logistics support and more successful tactical promotions in all of our Asian markets for the Chinese New Year holiday.”

  • Alibaba aims to slash wine prices

    Alibaba aims to slash wine prices

    Online retailer Alibaba believes it has found a way to cut the retail prices of wine in China.

    Using its business to business website 1688.com Alibaba has commenced selling wine direct to retailers, short-circuiting a raft of middlemen currently adding margins yet no value to the supply chain.

    Buyers from 1688.com are negotiating to buy wine in bulk direct from Spanish exporters which it then sells online to retailers.

    According to China news service Xinhua, in an article published on Alibaba’s own news website, a bottle of wine sold for 10 euros (68.54 yuan) in Spain can cost more than 240 yuan in China. That’s because the wine is often sold and on sold exporters to general agents, regional agencies and wholesalers before it finally reaches the retail shelf for consumers to buy. Each time the wine changes hands some 15 per cent margin is added to the price, along with additional freight charges and duties.

    Alibaba estimates that using 1688.com to link exporter and retailer, the same 10 euro bottle of wine in Spain could be retailed in China at just 116 yuan – that’s less than a half of the price traded through traditional channels, according to Liu Fei, a department manager at 1688.com.

  • Chinese in bid for New Look

    Chinese in bid for New Look

    Chinese buyers are circling high profile UK fashion brand New Look.

    UK news media are reporting negotiations are underway between a business linked with former Tesco CEO turned retail investor Sir Terry Leahy and a Chinese private equity group. The plan is to mount a joint venture bid for the business.

    New Look is currently owned by founder Tom Singh and private equity groups Permira and Apax Partners. The reports suggest a bid of £2 billion for New Look, which has more than 1000 stores internationally and a staff of more than 30,000.

    The US partner is Clayton, Dubilier & Rice, a private equity firm which owns 60 per cent of Luxembourg-based B&M. The Chinese partner is identified as CDH, another private equity group.
    Sir Terry reportedly has a shareholding in CD&R through a Cayman Islands based fund and is an advisor to the group on its retail investments.

    New Look has stores in Thailand, Korea, Singapore, Indonesia, China, Malaysia, Europe and the Middle East.

  • Tourists drag down Hong Kong retail sales

    Tourists drag down Hong Kong retail sales

    Official Hong Kong retail sales figures for March show a 2.9 per cent year-on-year fall, blamed on shrinking in-bound tourist numbers.

    According to data released by the Census and Statistics Department the fall follows a two per cent drop in January and February combined.

    A government spokesman blamed the sluggish sales on a slowdown in inbound tourism.

    “Most types of retail outlets recorded year-on-year declines in sales… Retail outlets selling certain consumer durable goods saw some notable increases in sales, mainly helped by the launch of certain smartphone models,” the spokesman said.

    Weakened tourism is likely to continue to constrain growth, he said, “although the stable labour market conditions should still render support to local consumer sentiment”.