Tag: China

  • Chinese hot pot chain Haidilao to launch in the Philippines

    Chinese hot pot chain Haidilao to launch in the Philippines

    Haidilao, the largest hot pot restaurant chain in China, will open its first store in the Philippines next month, the Department of Trade and Industry (DTI) said Friday.

    The DTI said Haidilao International Holding Ltd. would continue to open more restaurants within the year, creating at least 400 jobs. The DTI has yet to divulge further details, such as the number of stores and locations of Haidilao.

    According to the agency, the expansion plans of Haidilao in the Philippines took two years.

    The Philippine Trade and Investment Center in Hong Kong (PTIC-HK) and the restaurant chain owner started discussions on the latter’s plan in the first half of 2020.

    PTIC in Hong Kong and Guangzhou both assisted Haidilao to open its first branch in the country.

    In a virtual meeting with the Board of Investments (BOI) last month, Haidilao executives discussed the details of their operations here.

    “The intention of Haidilao is to present a superior dining experience and offer quality food for Filipinos at a reasonable price. In addition, Haidilao intends to fuse the Filipino taste into its menu and integrate Filipino core values in its service,” the DTI said in a statement.

    Haidilao was founded in 1994 in Sichuan, which is known for its extremely spicy food, particularly hot pot.

    The company now has over 1,000 restaurants in China, Hong Kong, Macau, Singapore, Malaysia, Taiwan, Australia, United States, United Kingdom, Canada, Thailand, Indonesia, South Korea, and Japan among others.

  • A Tech Crackdown Hits Alibaba Profit by Nearly 60%

    A Tech Crackdown Hits Alibaba Profit by Nearly 60%

    China’s economy has been battered by the fallout from strict COVID-19 curbs including lockdowns and transport restrictions that have kept consumers home, pushed up unemployment, and tangled supply chains. Alibaba has also had to contend with a wide-ranging regulatory crackdown on alleged anti-competitive practices by China’s tech giants.

    The Hangzhou-based group cited “macro challenges that impacted supply chains and consumer sentiment” as it announced a loss of 16.2 billion yuan ($2.56 billion) for the January-March quarter.

    It warned it would not give forward-looking financial guidance due to Covid risks and uncertainty.

    Alibaba has seen its market value plummet since Beijing launched its sweeping crackdown in 2020 on some of China’s largest home-grown companies.

    The crackdown included a last-minute cancellation of a planned IPO by Alibaba’s financial arm Ant Group, which would have been the world’s largest public offering at the time. The company was also hit with a record $2.75 billion fine for alleged unfair practices last year. But Alibaba Group said that its revenue grew around 9% in the last quarter to 204.1 billion yuan, better than expected in a Bloomberg forecast. The company’s revenues -generated mainly by its core e-commerce operations – were up 19 % for the fiscal year ending March 31. Meanwhile, its full-year profit came to 62 billion yuan ($9.8 billion).

    “Since mid-March 2022, our domestic businesses have been significantly affected by the Covid-19 resurgence in China, particularly in Shanghai,” the company said.  “Considering the risks and uncertainties arising from Covid-19… we believe it is prudent at this time not to give financial guidance as we typically do at the start of the fiscal year,” it added.

    Alibaba’s earnings follow a series of sluggish results by prominent Chinese tech firms, with internet giant Baidu reporting a net loss of 885 million yuan ($140 million) in the first quarter. Baidu’s business has been “negatively impacted” by China’s recent Covid-19 resurgence since mid-March, co-founder Robin Li said in a statement.  Virus-related challenges continue to pressure Baidu’s near-term operations, Li said.

    Tencent reported record low quarterly revenue growth at 135.5 billion yuan ($20.1 billion) in the first quarter, putting year-on-year expansion at nearly zero. China is the last major economy to stick to a strict zero-Covid policy, which is now being tested by the infectious Omicron variant.

  • Apple China opens its Wuhan store, with first Apple Pickup area

    Apple China opens its Wuhan store, with first Apple Pickup area

    Apple has launched its flagship in Wuhan, its first retail store in China to feature an Apple Pickup area.  Apple Wuhan is the 54th Apple store in China, as the tech giant continues to expand its footprint in Asia, especially in Mainland China.  The flagship store uses granite floors and wood-trimmed walls to make the store and mall lobby brighter and more transparent. The instore team will help customers with purchasing and personalising their devices, choosing instalment payment plans, using

    The instore team will help customers with purchasing and personalising their devices, choosing instalment payment plans, using eligible devices as trade-ins on new ones, and booking online support.

    According to Apple, its Wuhan staff can speak multiple languages – including sign languages in Chinese and English.

    “Our highly specialised team of experts is looking forward to welcoming customers from this vibrant community starting this Saturday,” said Deirdre O’Brien, Apple senior VP of retail operations and people.

    “This retail store brings new design elements to China for the first time, giving customers more ways to explore ideas, learn more about Apple products, or make it easier to pick up an online order in store.”

  • JD beats revenue estimates but CEO cautious over Covid outbreaks

    JD beats revenue estimates but CEO cautious over Covid outbreaks

     E-commerce group JD.com, beat estimates for quarterly revenue as more people shopped on its platform following COVID lockdowns in China, but its CEO was cautious on the outlook due to logistical disruptions and sluggish consumption.

    The resurgence of COVID-19 in the world’s second-largest economy in March and the strict lockdowns it has taken since to curb its spread, including in its most populous city Shanghai, have heavily disrupted normal life and business activity.

    JD.com CEO Xu Lei told analysts on a post-earnings call on Tuesday that the situation was far different to what China experienced in the past two years when outbreaks were limited to smaller areas of the country and boosted online shopping.

    This time, the spread of infections to major centres such as Beijing, Shanghai, Guangzhou and Shenzhen, and lockdowns were affecting both online and offline commerce.

    “In April, the order cancellation rate was significantly higher than last year due to logistical disruptions. There was an improvement in May, but it was still higher than a year earlier,” he said.

    “Consumers are facing loss in income and confidence, and overall consumption is sluggish,” Xu added.

    Shares in the Chinese company initially surged as much as 9% higher in pre-market trading but were flat when the market opened and after Xu’s comments.

    Analysts at Nomura estimated in mid-April that 45 cities in China, representing 40% of its GDP, were under full or partial lockdowns.

    Shanghai’s lockdown has been particularly strict with residents unable to shop for much more than daily necessities due to logistics bottlenecks and a shortage of couriers. The capital Beijing has also been tightening restrictions as it tries to stave off an outbreak.

    Underlining the impact of such measures, China’s retail sales fell 11.1% last month in their biggest contraction since March 2020.

    Still, investor sentiment towards JD.com and its peers on Tuesday was helped by comments Chinese Vice Premier Liu He at meeting with tech executives, which fanned hopes that a long-running regulatory crackdown on the sector is easing.

    U.S.-listed shares of Chinese firms rose after Liu said the government supported the development of the sector and public listings for technology companies.

    E-commerce rival Alibaba Group also surged 7% and Pinduoduo climbed more than 8% before the market opened.

    JD.com reported revenue of 239.66 billion yuan ($35.6 billion) for the quarter ended March 31, compared to Wall Street analysts’ estimates of 236.66 billion yuan, according to IBES data from Refinitiv.

    Excluding items, JD.com posted a profit of 2.53 yuan per American depository share (ADS), compared with analysts’ expectations of 1.62 yuan.

    The net loss attributable to ordinary shareholders stood at 2.99 billion yuan, compared with a profit of 3.62 billion yuan a year earlier.

  • Sportswear retailer Li Ning eyes in-store coffee brand

    Sportswear retailer Li Ning eyes in-store coffee brand

    As coffee gradually penetrates Chinese people’s daily life in recent years, some none-catering companies are starting to utilize the potential of this newly booming industry.

    Sportswear brand Li-Ning bursts into the coffee industry this year with Ning Coffee landing in its several offline stores in Beijing, Xiamen and some areas in Guangdong province.

    Li-Ning said it hopes to improve customers’ comfort level when shopping by optimizing its in-store services.

    In early February, China Post opened its first cafe in Xiamen, Fujian province, and will continue to open more stores in Beijing and Shanghai.

    Tongrentang, a traditional Chinese medicine pharmacy with a history dating back over 350 years, opened a shop featuring herbal coffee in 2020.

    According to market consultancy iMedia Research, China’s coffee market totaled 381.7 billion yuan in 2021, and is expected to maintain a high-speed development with a growth rate at about 27.2 percent.

  • Tesla Halts Production At Shanghai Plant Due To Supply Issues – Report

    Tesla Halts Production At Shanghai Plant Due To Supply Issues – Report

    Tesla Inc halted production at its Shanghai plant on Monday due to issues with securing parts for its electric vehicles, two people familiar with the matter said, the latest in a series of difficulties for the factory.

    Shanghai is in its sixth week of an intensifying COVID-19 lockdown that has tested the ability of manufacturers to operate amid hard restrictions on the movement of people and materials.

    Tesla had planned as late as last week to increase output to pre-lockdown levels by next week.

    It was not immediately clear when the current supply issues can be resolved and when Tesla would be able to resume production, said the people, who asked not to be identified because the production plans are private.

    Tesla did not immediately respond to a query for comment.

    China Passenger Car Association is scheduled to release April sales for Tesla, China’s second-largest EV maker behind BYD, on Tuesday.

    Another auto association said last week it estimated overall auto sales in China dropped 48% in April as zero-COVID lockdowns shut factories, limited traffic to showrooms and put the brakes on spending.

    Aptiv, Tesla’s main supplier of wire harnesses, stopped shipping from a Shanghai plant that supplies Tesla and General Motors Co after COVID-19 infections were found among its workers, two people familiar with the matter told Reuters on Monday.

    Tesla’s Shanghai plant, also known as the Gigafactory 3, produces the Model 3 sedan and Model Y crossover for the China market and for export.

    Tesla partially resumed production at the Shanghai plant on April 19 following a 22-day closure caused by the city’s COVID-19 lockdown.

    Tesla had been aiming to increase output at its Shanghai plant to 2,600 cars a day from May 16, Reuters reported previously.

    Shanghai authorities have tightened a city-wide lockdown imposed more than a month ago on the commercial hub with a population of 25 million, a move that could extend curbs on movement through the month.

  • Adidas lowers 2022 expectations amid China lockdowns

    Adidas lowers 2022 expectations amid China lockdowns

    Adidas lowered expectations for 2022 after a first-quarter slump as renewed COVID-19-related lockdowns in Greater China continues to hit the German sportswear company.

    First-quarter currency-adjusted sales shrank by 3% worldwide, to 5.3 billion euros ($5.58 billion), while profit from continuing operations fell 38%, to 310 million euros, it said on Friday.

    In Greater China, sales collapsed by 35% in the first quarter; for the year, revenue is expected to fall significantly due to store closures and strong traffic declines.

    The company now expects to come in at the lower end of its 2022 forecast for an 11-13% increase in currency-neutral sales as well as for net income from continuing operations of between 1.8 and 1.9 billion euros.

    Adidas also cut its operating margin forecast, saying it will remain at the previous year’s level of 9.4% instead of increasing to 11%.

    “In this environment, characterized by severe external challenges, it is imperative to stay focused on our strategic objectives,” said Chief Executive Kasper Rorsted.

    “While we will remain agile, we will not jeopardize our long-term growth opportunity for short-term profit optimization.”

    The company expects a return to growth in the second quarter despite the continued sales decline in Greater China and a 200-million-euro negative impact from supply chain constraints.

    In the second half of 2022, net sales are expected to grow over 20%, driven, among other things, by unconstrained supply, strong momentum in Western markets and major sports events.

  • Chinese speakers in demand as factories expand

    Chinese speakers in demand as factories expand

    Solar panel manufacturer Jinko Solar Vietnam in the northern province of Quang Ninh is looking for 5,000-8,000 workers, with most of them required to have basic Chinese communication skills. So far, less than 1,000 have been hired.

    “Manufacturing workers, technicians, quality control managers, we need them all. But not many suitable candidates are available,” said Dang Tran Hoang Anh, an HR officer with the company.

    As one of the world’s largest solar panel manufacturers, Shanghai-based Jinko entered Vietnam in 2020, and is looking for people in 40 different job categories to make high-quality products that are shipped to Europe.

    Anh said that Jinko pays well above average wages to secure the best talents in Vietnam. He just hired a worker who can speak Chinese fluently for a monthly salary of VND29 million ($1,263), 70 percent higher than what she was being paid at her old company.

    “We want the best Vietnamese workers who can communicate in Chinese to complete many projects.”

    Jinko is one of many companies that are scrambling to find Chinese-speaking Vietnamese workers as they set up factories in Vietnam to take advantage of the country’s low labor cost and export potential. Higher costs and risks in China, including its trade war with the U.S., motivated companies from many countries to make a shift to Vietnam.

    Taipei-based electronics manufacturer Wistron Infocomm in the northern province of Ha Nam is recruiting people for 10 job categories including project management consultants, procurement officers and engineers, with most of them required to have basic or fluent Chinese language skills. Car tire manufacturer Jinyu Tires in the southern province of Tay Ninh is looking for 50 students who can speak Chinese for a training program to find the best future employees.

    Popular recruitment platforms VietnamWorks and JobStreet have 140-200 job postings for Chinese-speaking candidates, mostly as procurement officers, quality control managers and engineers. The recruitment rush for Chinese-speaking workers began at the end of last year and grew stronger in the first quarter, with strong demand seen in northern industrial hubs, said Ngo Thi Ngoc Lan, northern region director at recruitment firm Navigos Search.

    The provinces of Bac Ninh and Bac Giang have a large supply of workers who can speak Chinese, but companies are seeing strong competition for them, she said. In the provinces of Phu Tho and Quang Ninh, there is less competition but it is more difficult to recruit high-skilled workers, she added. China has consistently been among the top 10 foreign direct investors in Vietnam in recent years.

    Mainland China ranked fourth in registered capital in the first four months at over $1.07 billion, while Hong Kong and Taiwan secured the seventh and eighth places. Together, the three territories registered $2.1 billion in capital, second only to Singapore at $3.1 billion. China’s Goertek Vina, one of the key suppliers for Apple, increased its investment in Vietnam by $306 million to over $565 million this March.

    The company had nearly 28,000 workers in its plant in the northern province of Bac Ninh as of February, up from an average 23,000 last year. Another 5,000 jobs will be added when its plant in the central province of Nghe An begins operations in June, and by 2023, it will have 30,000 employees. Another Apple supplier, Foxconn, said last year that it would pour an additional $700 million into its Vietnam operations on top of its $1.5 billion investment.

    Lan said that U.S.-China tensions, which began several years ago, have pushed many Chinese companies to move to Vietnam, generating a large demand for local employees. Chinese employees have higher requirements than Vietnamese peers in terms of salary and benefits, so it is more cost-effective to hire Vietnamese, she added.

    She predicted that the trend of recruiting Chinese-speaking Vietnamese in factories will keep rising for at least five more years.

    “This will surely encourage workers and students to learn Chinese as they see the career potential.”

    At present, however, finding Chinese-speaking Vietnamese people is not easy. Anh of Jinko said it was difficult to find suitable Chinese-speaking candidates because many do not want to move from Hanoi to Quang Ninh to work.

    “We have to train most candidates, either in Chinese or in their professional skills, to get the people we need.”

    Lan said that companies are also seeing challenges in recruiting because candidates either have the professional skills and lack language fluency or vice versa. Some companies also want employees to be able to speak English, she added.

    Chinese firms offer salaries that are 40-50 percent lower than European and American companies, while requiring employees to work on Saturdays. These are some drawbacks that discourage candidates, she said.

    Jinko Solar Vietnam used to have Chinese nationals account for 70 percent of its employees in Vietnam, but the company has reduced the ratio to 50 percent now, because Chinese staff often work for six to 12 months and return to home. The factory, meanwhile, needs long-term personnel.

    “We are offering salary of up to VND70 million a month for some directors’ jobs, and we only want Vietnamese candidates.”

  • Yum China sales fall as pandemic impact worsens

    Yum China sales fall as pandemic impact worsens

    The owner of KFC and Pizza Hut said sales plunged by 20% in the first two weeks of March as a surge of new Covid cases spread across China.

    Yum China said “the situation has rapidly deteriorated” as regional lockdowns have been put in place to stem the outbreak.

    More than 1,100 of its stores are temporarily closed or offering takeaway and sales are “still trending down”.

    China’s lockdowns are among its biggest since the beginning of the pandemic.

    They include the Jilin province – home to companies such as carmakers Toyota and Volkswagen – as well as technology hub Shenzhen as the number of new infections of the Omicron variant of Covid rise.

    Yum China said: “Entering March, the situation has rapidly deteriorated with the highly transmissible Omicron variant causing outbreaks across China, including economically important regions of Guangdong, Shanghai, Shandong and Jilin.”

    It added: “Our operations are significantly impacted by the latest outbreaks and the tighter public health measures which resulted in a further reduction of social activities, travelling and consumption.”

    Toyota, Volkswagen and iPhone-maker Foxconn have been forced to close operations in affected regions due to lockdowns.

    Although Foxconn said on Wednesday it was able to restart some production in Shenzhen after putting in place a closed loop system on its campus. It means that Foxconn employees working in the space cannot move outside the group.

    Foxconn said: “This process, which can only be done on campuses that include both employee housing and production facilities, adheres to strict industry guidelines and closed-loop management policies issued by the Shenzhen government.”

    There are concerns the restrictions could have an impact on global supply chains.

    But Yum China’s chief executive Joey Wat, said: “Our robust supply chain management has shielded us from material business disruptions.”

    Yum China said it had more than doubled the number of stores it had closed or restricted to take-out services from 500 in January to 1,100 in March.

    Ms Wat pledged: “We will keep our restaurants open and provide food services to customers wherever it is possible and safe to do so.”

     

  • Blackmores believes China’s diagou market is past its peak

    Blackmores believes China’s diagou market is past its peak

    The boss of Blackmores says the vitamins and supplements giant is not really relying on Chinese “daigou” shoppers anymore as it gains more market share in Indonesia and Thailand, while the huge opportunity of densely-populated India will be a slow burn.

    After delivering the company’s latest results on Thursday, chief executive Alastair Symington also said customers should not expect a price war with Blackmores’ competitors as too many discounted promotions led to “a lack of differentiation between brands”.

    It also means lower margins for the business, which wants to maintain its premium positioning in the market, highlighting its superiority with things like the ethical sourcing of fish oil.

    The company booked a 9.6 percent rise in underlying net profit for the first half, with earnings margin growth in Australia and New Zealand of almost 18 per cent credited to “strategic pricing and operational improvements”.

    Mr Symington said the results were ahead of expectations in all markets despite volatile and uncertain trading conditions due to the pandemic.

    Blackmores’ overseas business is leading the charge, with revenue up about 50 percent.

    Mr Symington said 110 percent growth in the massive market of Indonesia was particularly pleasing, driven by consumers snapping up vitamin D and zinc on the back of clinical evidence these improve immune health – a key consideration amid lockdowns.

    Growth in Thailand of 40 percent was also a highlight, he said, but Australian consumers were still behaving very cautiously and there had been a “stuttery start” to sales this calendar year, with ANZ revenue dipping 1.2 percent.

    But Blackmores has its eyes on a very big prize – India – where it launched in September in partnership with Amazon India.

    The company recently entered a distribution partnership with Udaan, India’s largest business-to-business e-commerce platform, expanding the reach of its products to independent pharmacies in at least 10 metro cities across the continent, which is home to well over one billion people.

    “There’s a lot of promise in that India business,” Mr Symington said.

    Mr Symington says growth areas include ‘healthy ageing’ products targeting concerns such as joints, digestive health and anxiety in pets, and sleep and beauty.

    On China, he said the daigou market – whereby visitors send goods back home – would not return to the loft heights seen in 2016 and 2017, when dedicated stores offering resellers in-demand products and delivery services popped up around Australia.

    Blackmores recorded an 8.5 per cent lift in revenue to China in the first half, “driven by continuous improvements in e-commerce fundamentals … partially offset by a 7 per cent decline in the corporate daigou channel”.

    “We’re not really relying on that (diagou market) moving forward,” Mr Symingto

  • China Expects To Meet Charging Demand Of 20 Million-Plus EVs By End Of 2025

    China Expects To Meet Charging Demand Of 20 Million-Plus EVs By End Of 2025

    China expects to meet charging demand for more than 20 million electric vehicles by the end of 2025, the National Development and Reform Commission said in a document on Friday.

  • Amazon tipoff leads to Chinese seizure of counterfeit luxury belts

    Amazon tipoff leads to Chinese seizure of counterfeit luxury belts

    Chinese authorities have seized hundreds of counterfeit belts bearing the Salvatore Ferragamo brand with the aid of Amazon’s Counterfeit Crimes Unit (CCU).

    The belt is one of Ferragamo’s most known accessories – its link-shaped buckle is used by the brand as a logo for many other products – and it sells for more than US$320.

    The investigation was part of a worldwide probe by Amazon and Ferragamo in identifying bad actors who are trying to sell fake products. Amazon bans the sale of fake goods on its platform globally and in 2020 invested more than $700 million to reduce the incidence of it happening.

    The two companies reported the fake vendor to the Market Supervision and Administration (MSA) authority in Yiwu City, located in China’s Zhejiang Province.

    MSA and CCU said they subsequently seized hundreds of counterfeit belts and buckle accessories which may have been sold throughout retail channels around the world.

    Both companies say they will continue to focus on law enforcement and preventing counterfeit products from entering the global supply chain.

    “This should serve as a reminder that bad actors will be held accountable, as Amazon collaborates with both brands and law enforcement agencies around the world to stop inauthentic products from being sold across the retail industry,” said Kebharu Smith, head of Amazon’s CCU.

    Salvatore Ferragamo last year ran a series of offline and online anti-counterfeiting measures to protect its customers and its brand, removing more than 22,000 products and profiles on social media platforms and over 130,000 product listings on online shops.

    In February last year Amazon and Ferragamo jointly filed two lawsuits in the US against manufacturers who had allegedly used Ferragamo’s registered trademarks to deceive customers over the authenticity of the products.

    The Organization for Economic Cooperation and Development has estimated the global trade in counterfeit products was worth as much as $464 billion in 2019 and said a boom in e-commerce in 2020-21 led to massive growth in the supply of counterfeit goods online.

  • Alibaba’s Freshippo struggles to meet demand during Shanghai lockdown

    Alibaba’s Freshippo struggles to meet demand during Shanghai lockdown

    Alibaba’s supermarket chain Freshippo says it is adding more couriers to meet high demand in Shanghai but this was not yet catching up with the rising needs of locked-down residents as the city battles a surge in Covid-19 cases.

    Shen Li, a vice president at Alibaba Group’s Freshippo, told reporters on Sunday that while the company’s delivery capacity had recovered to about 60-70 per cent of pre-outbreak levels as more couriers were allowed back on the roads, many difficulties remained.

    “The biggest challenge we are facing now is that the demand and numbers of orders from consumers has increased by about two to three times compared with pre-outbreak levels,” she said.

    China’s most important economic hub has locked down most of its 25 million residents for more than three weeks in an effort to stamp out the country’s largest outbreak since the virus first emerged in Wuhan in late 2019.

    After most supermarkets and stores were shut across the city, residents resorted to online buying to procure food and other essentials but have faced difficulties. Shanghai authorities have said they are trying to ease these bottlenecks but it remains a key public frustration.

    Many residents have described waking up as early as 5am to try and grab delivery slots from online grocers such as Freshippo, only to find them sold out in seconds. While Freshippo and other vendors have launched bulk-buying purchase schemes, some people have complained about the inability to reach the volumes needed to guarantee orders.

    Shen said Freshippo as of Sunday had 47 stores open for online deliveries in Shanghai and it also had set up six additional ad hoc warehouses for the city, due to issues with inter-province supply chains.

    About 5000 staff were working in these stores and its warehouses while a further 1000 were working online from home, she added.

  • Chinese shun foreign brands

    Chinese shun foreign brands

    Catwalks canceled, showrooms closed, stores shuttered: the pandemic has led to massive disruption across the fashion industry. Even in China, which has coped with the pandemic better than many countries, multi-brand store buyers have been forced to place orders online, rather than in the showroom. And they don’t like it much.

    All this has led many Chinese fashion buyers to order more conservatively this year or ignore international brands and opt for local Chinese labels.

    Olivia Chen, head of Assemble by Réel, a high-end store in Shanghai’s centrally-located Réel Mall, says that virtual ordering makes her feel like something is missing. “In a showroom, you’re immersed in an environment that conveys the season’s atmosphere. We can use a variety of sensory clues to gain insight into the story the designer wants to convey,” says Chen. “These elements create a certain kind of atmosphere, one that has a lasting and powerful influence. Images and other materials related to remote purchases can evoke some of that feeling, but it can’t achieve a high degree of resonance.”

    Chen emphasises the difference between an image of a product and the product in real life, whether it’s in the weight of the fabric or the way the fabric moves on the body.

    Eric Young, head of high-profile designer store Le Monde de SHC in Shanghai, agrees. “Many times you have no choice but to judge a product from a photo or small picture, but even with Zoom, the imaging quality of different showrooms is actually very different,” he says. In Paris, he points out, a whole series of brands can be viewed in the space of a day. By contrast, online ordering is a long repetitive process of frustration. “In the end, one grows numb to viewing things online,” he says.

    More buyers would prefer to make the long trip to Europe for a more immersive experience — it would let them buy more boldly, explore new hot brands and interact with designer brands on a more personal level. Frustrated that they can’t travel, some buyers have come up with alternative solutions: from the AW21 season, Shanghai buyer store Eth0s set up a small showroom for 15 foreign brands including Geoffrey B. Small, Marc Le Bihan and Antonio Marras.

    Chen also notes that extra materials are being provided to improve the online experience. “The main change since the pandemic started is that brands are providing auxiliary materials before a Zoom meeting, including introductions to a line, lookbooks and fabric samples,” she says.

    As Chen notes, a shift to online ordering already predated the pandemic to some extent. “Actually a lot of brands started doing online ordering before this,” agrees Jony, manager of Chengdu buyer store Clap. “But it’s a plan B at best. Physical ordering is still extremely necessary.”

    Like many Chinese buyers, Le Monde de SHC’s Eric Young is reluctant to take a risk with new foreign brands that he cannot physically touch and see for himself. That problem has encouraged buyers to play safe, making safer purchases. “It’s also an opportunity for local designers. As long as the lines they launch are good enough, they’ll definitely have a higher chance of getting orders than they would have before the pandemic. Shanghai Fashion Week this past April was more active than it’s ever been,” he says.

    At Eth0s, another leading Shanghai store, head Chen Fei has struggled to find the right Chinese brands that match his outlook. “We have been very committed to finding domestic brands, and we’ve met some good designers, but… we want a brand that shares our world view,” he explains.

    Chen Fei has not played safe, looking for bold special pieces to excite his customers. “Everyone was quite frustrated because of the lockdown, and we wanted to stimulate the pleasure they get from consuming. And we wanted customers to be happier.”

    Chen Fei argues that the brands, rather than store buyers such as himself, have played it safer. “One thing that got more conservative was their style designs; another was their business decisions,” he says.

    In Chengdu, Clap has reduced its budget for foreign designer brands by 30 to 50 per cent — instead, Clap has bought local high-impact brands. Fashion pieces with strong graphics are often bestsellers, says Jony. “Such styles may excite customers more easily, because when you’re not sure about the line itself or the fabric, the easiest way to decide what you’re going to buy is through graphic design.”

    Olivia Chen of Assemble by Réel believes that if an effective purchasing programme is maintained, sales can be guaranteed. Post-pandemic, Assemble has maintained a sell-out rate of around 85 per cent.

    The current situation has some time to run yet. Even the most optimistic forecasts do not predict normal travel resuming before the beginning of 2022. That means at least another season or two of ordering online.

    With that in mind, Chen Fei believes brands should find better ways of presenting every detail of their clothes, especially more high-priced products. “If we can’t see the brand information clearly, it’s possible we’ll consider reducing our order, but where the information is clear, we feel quite confident about placing an order. For example, Rick Owens is very good — they have a representative in China and will try to provide very complete information. For example, if a style has five fabrics they’ll do their best to provide samples. We’ve bought from them for a long time. We even know the body shape of the model the brand uses, so there won’t be any big deviations in our orders.”

    Foreign showrooms are looking to enter the Chinese market. At Shanghai Fashion Week in April, Antwerp agency Up Next brought a number of brands, including Casablanca, Botter and Sweetlimejuice.

    Fresh design ideas and exciting new brands remain a driving force for the most fashion-forward stores. While easy-to-wear brands at attractive price points are likely to sell well in China, as in any market, the new generation of buyer-led stores are also serving the tastes of some increasingly sophisticated customers. “A lot of female consumers have gotten really niche in their tastes, and wear the clothes really well, better even than the brand’s own styling,” says Chen Fei. “They wear the clothes in ways the brand didn’t expect them to.”

  • First KFC ‘Green Pioneer Stores’ open in China

    First KFC ‘Green Pioneer Stores’ open in China

    Yum China has just launched KFC’s first Green Pioneer Stores in Beijing and Hangzhou, as it works toward building a network of net-zero restaurants in the future.

    The move is part of the company’s climate strategy and a roadmap to achieving net-zero by 2050, following its pledge to Business Ambition for 1.5°C Commitment Letter to the Science-Based Target initiative (SBTi) last year.

    “We are committed to driving meaningful change and pioneering in the restaurant industry towards net-zero emissions. Building Green Pioneer Stores is an important part of our journey,” said Joey Wat, CEO of Yum China.

    Following the company’s 4R principles (reduce, reuse, recycle, replace), KFC has already incorporated several environmentally friendly practices in its stores across the country, such as:

    • Solar panels in its Hangzhou store generate an estimated 10,000 kWh of energy each year, which helps reduce carbon emissions from electricity consumption.
    • An Internet of Things-based (IoT) intelligent restaurant energy management system which helps improve the energy efficiency of Green Pioneer stores by around 10 per cent annually.
    • Each Green Pioneer Store is equipped with a Tubular Daylighting System that uses natural lighting, reducing electricity consumption.
    • Using eco-friendly materials such as ceramic floor tiles made from recycled energy, low-carbon bamboo and alt-leather made from recycled KFC coffee grounds.

    The company said the Green Pioneer Stores will also allow customers to experience and learn about eco-friendly restaurants by integrating “green interior design”.

    At its Beijing store, a Family Bucket is made entirely of recycled packaging. While in Hangzhou, a wall section was intentionally left unfinished with an opening to show customers the restaurant’s eco-friendly construction process.

    While the restaurant chain has already integrated environmentally friendly initiatives, the company aims to further improve its emissions reduction by 15 per cent each year.

    “We will continue to explore the utilization of innovative technologies in restaurant construction and operations to promote sustainable development and contribute to the low carbon economy,” Wat added.