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Tag: Sales

  • Luk Fook sales recover from three-year slide

    Luk Fook sales recover from three-year slide

    After 12 consecutive quarters of decline, jeweller Luk Fook has recorded a 2 per cent turnaround for its fourth quarter, ended March 31.

    The retailer says that with a relatively low base and encouraging improvement in the Hong Kong/Macau market, same-store sales growth moved back into the black for its self-run outlets.

    In addition, Luk Fook sales of gold and gem-set jewellery products rose 16 per cent and 6 per cent respectively in Mainland China leading to double-digit growth for the first time this year, reaching 11 per cent.
    On the other hand, the same-store sales of gem-set jewellery products in Hong Kong and Macau also turned around from a decline of more than three years to achieve 12 per cent growth.

    During the quarter the group opened four self-run shops on the mainland and closed one licensed shop. At the end of March the group had 199 self-run shops in total – 133 in China, 47 in Hong Kong, 10 in Macau and nine in other countries. Together with 1296 licensed shops in China and one in Korea, there were a total of 1496 shops worldwide.

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  • Burberry sales ‘lacklustre’ despite China boost

    Burberry sales ‘lacklustre’ despite China boost

    Strengthening sales in Mainland China and an “exceptional” UK performance helped UK luxury fashion retailer Burberry weather a weakening US market in its second half year.

    Same-store Burberry sales rose 3 per cent – a lesser rate than during the third quarter. The company said a recovering Mainland China market had driven growth in Asia-Pacific.

    Incoming CFO Julie Brown says UK Burberry sales soared 90 per cent during the second half year as US tourists took advantage of the weaker pound in the UK.

    But sales in its wholesale division fell by 13 per cent and licensing sales fell 38 per cent, although the latter was largely due to the company taking back control of its Japan business.

    While based in Great Britain, the bulk of Burberry’s turnover is abroad and Hong Kong and China comprise its largest market.

    Releasing its second half year sales figures, the company revised down its estimate of the sales boost from the weaker UK currency from an earlier projected £130 million to £115 million. And it warned shareholders to expect a £10 million hit in 2018.

    Charlotte Pearce, associate retail analyst with GlobalData, described the second half results as “lacklustre” following impressive third quarter figures.

    “Burberry’s international performance in the second half has proved disappointing, with declining sales in Korea and the US and a challenging market in the Middle East bringing down the brand’s overall performance.

    “However, its plan to invest in store refits will help to increase footfall, especially in areas such as Hong Kong, where trading has historically been much more positive.”

    She said Burberry’s strong digital performance, particularly via mobile, continues to drive growth for the luxury brand as it maintains its reputation as a digital innovator in the luxury market.

    “Burberry live-streamed its February catwalk show on Instagram, giving the brand a sense of accessibility and allowing the brand to engage with shoppers on a platform where many consumers are regularly active. Burberry’s investment in experiential retail, including its app which will be rolled out in English speaking countries from the first quarter, will resonate well with modern shoppers and enable it to promote new products.”

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  • Asos posts half year profit increase

    Asos posts half year profit increase

    Online fashion retailer, Asos, has posted a 14 per cent increase in profits for the six months to the end of February to £27.3 million.

    The company saw a 31 per cent increase in sales to £889.2 million. UK retail sales rose by 18 per cent and international sales went up by 42 per cent.

    Sofie Willmott, senior retail analyst at GlobalData, said Asos’ broad product range sold on local language and currency platforms, along with its aggressive delivery proposition and responsive pricing, allows it to steal market share from well-established international and local players.

    “Asos’ mobile-first approach has paid off with mobile devices now accounting for 58 per cent of orders and 70 per cent of traffic,” she said.

    Willmott said competitors targeting the 16-34 age group should take note that a spotlight on mobile functionality to create a smooth, and enjoyable, shopping journey will drive visitor-purchaser conversion.

    “In a period of weak volume growth, retailers must use mobile channels to capitalise on frequent engagement and implement fast and simple checkouts to capture impulse spend.”

    According to Willmott, Asos has continued to strengthen its product offer by introducing new brands, including competitors Miss Selfridge and Burton, while also broadening its own label offer into niche product areas such as plus size for men which was recently introduced and activewear due to launch in 2017 – allowing Asos to target a larger customer base.

    “Meanwhile, the number of UK Asos premier customers lifted 41 per cent on last year, leading to an eight per cent rise in order frequency in the UK.”

    GlobalData research shows Asos is market leading in driving spend through its delivery subscription scheme, with 60 per cent of consumers shopping at Asos more often since signing up.

    Despite a 14.3 per cent rise in operating profit to £27.1 million, operating margins fell to 2.9 per cent from 3.6 per cent last year, signalling the impact of the highly promotional sector.

    “Since Asos is committed to keeping prices stable despite higher inflation in 2017, we forecast margins to weaken further in H2.”

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  • Fashion retailer Jaeger reportedly on brink of collapse

    Fashion retailer Jaeger reportedly on brink of collapse

    Century-old UK fashion retailer Jaeger is reportedly on the brink of entering administration.

    The 25-store strong chain was recently sold by private equity company Better Capital to an unidentified buyer, but according to a report in the Sunday Times, the business is believed to be beyond repair.

    Better Capital paid £19.5 million for Jaeger in 2012, but the business has not been profitable since.

    Jaeger received a royal warrant in 1910 and in its heyday, its fashion models included Audrey Hepburn and Marilyn Monroe. But the business entered a decline in the 1980s, overtaken by more popular brands from Europe.

    The Sunday Times reported the mystery buyer was Edinburgh Woollen Mill, which has a track record of buying distressed retail businesses and turning them around.

    “Edinburgh Woollen Mill has a history of buying troubled retailers and turning them around, and it’s one of the more credible bidders for Jaeger,” an unnamed source told the Press Association.

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  • Ted Baker stronger on America and China

    Ted Baker stronger on America and China

    New stores in North America and China have paid off for British fashion retailer Ted Baker, which has reported a 4.4 per cent increase in pre-tax profit, despite the challenging global retail environment.

    It achieved a profit of £63 million for the year to January 28, as total revenues rose 16.4 per cent to £531 million.

    Online sales rose 35.1 per cent, while 14 new stores in the US and Canada fuelled a 28.3 per cent increase in sales there.

    Ted Baker also commenced a new focus on Greater China, opening a store in Beijing.

    Fiona Paton, an associate retail analyst with GlobalData, says the falling demand for premium goods presents challenges in Asia.

    “However with British heritage brands remaining popular in the region, Ted Baker should lean upon this trait through its marketing and store environment while working hard to gain more exposure.”

    Even in the tough UK and European markets, Ted Baker thrived last year, sales rising 10.7 per cent.

    Observers can expect to see even better results next year, Paton believes.

    “While it has a measured approach to expansion, new stores and concessions are planned throughout Europe, North America and Asia in 2017-18, bolstering growth amid difficult domestic trading conditions.”

    In range terms, womenswear was a highpoint for Ted Baker achieving 19.7 per cent growth for the year, accounting for 57.3 per cent of sales, while menswear grew 12.2 per cent.

    “Menswear will simultaneously be a challenge and an opportunity for Ted Baker. While men are becoming more interested in fashion and buying more regularly, the sector is also becoming increasingly competitive as players such as Superdry extend their menswear ranges,” says Paton.

    “Unlike rivals such as Whistles, Ted Baker benefits from unisex appeal but will need to monitor the competition to ensure that its designs remain distinctive enough to differentiate itself.”

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  • Signs abound that the worst may be over for Hong Kong retailers

    Signs abound that the worst may be over for Hong Kong retailers

    Hong Kong’s retailers and mall operators are crossing their fingers in the hope that the signs of recovery in tourist arrivals and the return of spending aren’t flashes in the pan.

    Jewellers like Chow Tai Fook and retailers are reporting that the pace of their sales declines have slowed, indicating that the struggling industry may have finally found a bottom.

    Hong Kong used to be the favourite shopping destination for mainland Chinese tourists, lured to the city by its wide selection of tax-free brands and cheaper currency.

    Retail sales dwindled since 2014 amid Beijing’s anti-corruption campaign started a year earlier, local backlash against the hordes of mainland tourists thronging Hong Kong malls and the strength of the Hong Kong dollar.

    As tourist numbers started to recover in the past few months, mall developers and clothes vendors are becoming more optimistic towards their profit prospects.

    SEE ALSO: Red Valentino opens new Hong Kong store, debuts Walky Land collab

    “The signs of bottoming out are visible, as same-store gross profit has stopped declining, after a period of negative growth for more than one year,” said Tsin Man-kuen, chairman of fashion brand Bossini, whose same-store gross profit declines slow to 6 per cent in the second half of 2016 from the 14 per cent the same period a year ago.

    Wharf Holdings, the city’s biggest mall operator, said tenants’ 2016 sales decline at Harbour City slowed to 10 per cent at HK$27.7 billion, compared with the 15 per cent first-half slump. At Times Square in Causeway Bay, the sales drop narrowed to 11 per cent, from 16 per cent over the same period.

    The Sogo department store in Causeway Bay, which contributes to 87 per cent of the revenue of Hong Kong-listed Lifestyle International, said its sales decline slowed in the second half.

    Samsonite International, the world’s largest luggage maker, said its Hong Kong sales drop narrowed to 7 per cent in the second half of 2016 from the 16 per cent decline in the first half, adding the market has shown “early signs of stabilising”.

    Analysts largely agree with the cautiously optimistic view, citing a recovery in inbound tourism and improving consumer sentiment in the mainland.

    Mainland visitor numbers grew 6.1 per cent in December and 7.7 per cent in January, compared with a 6.7 per cent drop in the entire year of 2016.

    The city’s retailers can also benefit from a wealth effect caused by rising property price in the mainland – meaning consumers spend more because of a strong sense of financial security, analysts said. However, some warned that mainland tourists who opt for Hong Kong are no longer the wealthiest batch, and a weaker yuan means they are not able to buy as much as they used to.

    “The spending power per head for mainland Chinese tourists is decreasing,” Walter Woo, an analyst with China Merchant Bank, said. “But I’m still quite positive on the Hong Kong retail segment because the traffic has been rising.”

  • Shopify revenues grow 90 per cent

    Shopify revenues grow 90 per cent

    Shopify, the cloud-based, multi-channel platform designed for small and medium-sized businesses, has reported a 90 per cent increase in revenues for 2016.

    GMV rose 99 per cent to US$15.4 billion, figures which “speak to the enormous opportunity in retail right now and our strategic position within it,” according to CFO Russ Jones.

    Total revenue for the full year reached $389.3 million, compared with $205.2 million in 2015. Within this, subscription solutions revenue grew 68 per cent to $188.6 million and merchant solutions revenue grew 115 per cent to $200.7 million.

    But it still recorded a net loss of $35.4 million, almost double the $18.8 million of 2015.

    Merchants can use Shopify software to design, set up, and manage their stores across multiple sales channels, including web, mobile, social media, marketplaces and physical retail locations. Shopify powers 377,500 merchants in some 175 countries. Its clients include Tesla, Nestle, GE, Red Bull and Kylie Cosmetics.

    “Our work at Shopify is to help entrepreneurs thrive in a space that’s changing all the time, and we did our job especially well this past holiday season,” stated Tobi Lütke, founder and CEO of Shopify. “That eight of our 10 top sellers over the Black Friday Cyber Monday weekend were merchants that had upgraded from lower-priced plans reminds us that today’s startups become tomorrow’s superstars, at a velocity that appears to be increasing all the time. As the engine powering the growth of these merchants, Shopify has an opportunity that stretches years into the future.”

    For the full year 2017, Shopify currently expects revenues in the range of $580 million to $600 million and an operating loss in the range of $73 million to $77 million.

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  • Tokyo boosts Valentino sales

    Tokyo boosts Valentino sales

    Luxury fashion retailer Valentino boosted sales by 12.4 per cent last year, reaching €1.11 billion.

    Following a stunning 47 per cent growth in Valentino sales the previous year, the company has trebled its turnover in the four years since Qatari royal family acquired the business in 2012.

    A major factor in last year’s growth was the expansion into Japan, where it opened a new flagship in Tokyo’s Omotesando district. Two more stores are planned for the city, the first in Ginza and another in a location yet to be disclosed, but possibly Roppongi.

    The US continues to be the brand’s largest market accounting for about 20 per cent of sales.

    Valentino currently operates 175 of its own stores internationally, with retail sales accounting for 55 per cent of sales and the balance wholesaling. The company is on track to open 20 more physical stores this year, along with boosting its online presence and sales through both its own website and those of multibrand retailers.

    Profit for last year was €206 million, up 14.4 per cent on 2015.

    While privately owned Valentino sales and profit results are released due to a mid-term intention to launch an IPO. GM Stefano Sassi said in a press statement there was no decision at this time on timing for the float.

    “There is nothing planned for 2017, and the project will be re-evaluated based on the most favourable market conditions.”

  • Sale of cars down despite price drop

    Sale of cars down despite price drop

    Members of the Vietnam Automobile Manufacturers’ Association (VAMA) sold more than 17,600 cars in February, down 13 per cent from the previous month.

    The prices of many types of cars were adjusted in the market in recent months. This is the second month this year that the association has witnessed a drop in sales, although its members continuously reduced prices of their products.

    At the end of last month, prices of seven types of cars were adjusted, including imported and locally-assembled ones.

    Honda Vietnam decreased its price by VND80 million for Accord, which was imported from Thailand. Meanwhile, Toyota Motor Vietnam (TMV) announced new prices for Yaris models G and E, with a drop of VND47 million (US$2,057) and VND44 million, respectively. The imported Land Cruiser Prado TX-L and Land Cruiser VX also saw a revision in prices at nearly VND2.17 billion and VND3.65 billion, down VND264 million and VND70 million each.

    Honda Vietnam and TMV were followed by other automakers.

    Domestic automaker Thaco reduced the prices of Kia and Mazda models by between VND20 million and VND140 million each.

    A report from the People’s Committee in central Quang Nam Province showed that vehicles witnessed the highest inventory volume in the province, which was nearly 49 per cent higher than the previous month and almost triple compared with the same period last year.

    This was partly due to the increase in demand for vehicles before the Tet (Lunar New Year) holiday, which declined after the holiday. In addition, people were still waiting for prices to reduce further, especially once the import tax on vehicles from ASEAN countries dropped to zero per cent by January 1, 2018, according to the committee.

    While the consumption of locally-assembled cars was showing a declining trend, the volume of imported cars had sharply increased.

    According to the estimate of the General Statistics Office (GSO), Viet Nam imported some 9,000 complete built up units in February, worth $153 million, up 29 per cent in volume in comparison with the previous month but sticking to the same value.

    On average, each imported car in February was $17,000 — $4,850 lower than January – which meant almost all imported cars were less expensive.

    During the Government’s February meeting session, Prime Minister Nguyen Xuan Phuc reminded relevant ministries about the rapid increase of imported vehicles in the first two months of this year, which was due to the impact of the expected import tax decline in 2018.

    He said this was a warning to relevant ministries and sectors to strengthen management to create harmony between import and local auto manufacturing.

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  • Japanese convenience store sales grow

    Japanese convenience store sales grow

    Sales at Japanese convenience stores rose 0.1 per cent in January from a year earlier, up for the fourth consecutive month.

    Industry data shows there were brisk sales of hot food and side dishes.

    Same-store sales for eight major chains totalled ¥753.16 billion (US$6.7 billion), the Japan Franchise Association says.

    While the number of customers dropped 1.1 per cent to about 1.2 billion – declining for the 11th straight month – spending per customer rose 1.2 per cent to ¥620, up for the 22nd consecutive month, according to the association.

    The number of convenience stores increased 2.5 per cent from a year earlier to 54,496.

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  • Tariffs are cut, import prices fall, but cars are still pricey

    Tariffs are cut, import prices fall, but cars are still pricey

    According to GDC, in January 2017 alone, Vietnam imported 1,000 cars from India, worth $3.7 million in total. The average import price was $3,700 only, or VND85 million, the price level described as ‘surprisingly low’ and ‘dirt cheap’. The imports from India are mostly Hyundai i10 and i20.

    However, Vietnamese cannot buy imports at VND85 million. The amount of money they have to pay will be four or five times higher.

    As explained by a car dealer, imports from India are taxed 70 percent. Besides, they are also subject to other kinds of tax, including luxury tax (35 percent for 1.0-1.5L cars) and VAT (10 percent).

    Imports also bear many other different kinds of fees, such as ownership registration fee (10-12 percent, or VND233-237 million), the number plate granting fee (VND20 million in Hanoi), registration fees (VND340,000 for the first time), and road maintenance fee (VND130,000 a month).

    At present, a Hyundai i10 is sold at VND350-450 million in the market, or five times higher than the factory price.As such, every import product from India would cost VND260 million on average after taxes and fees. Meanwhile, the selling prices will be defined after adding up distribution expenses, profits for distributors, storage fees, and marketing & advertisement costs.

    The same is occurring with imports from ASEAN. Though the import tariffs have been cut from 40 percent 30 percent since early 2017, the selling prices are still many times higher than the import prices.

    Nguyen Tuan, director of Thien An Phuc, a distributor, said a Toyota Fortuner from Indonesia has the CIF price of $27,500, or VND700 million. However, the selling price could be as high as VND1.3 billion.

    “Because of high taxes, Vietnamese have to pay high to own cars,” he explained, adding that the selling price in Vietnam is 2-3 times higher than in other regional countries.

    By 2018, when the import tariff goes down to zero percent, the price of one Fortuner would fall by VND290 million thanks to the tariff cut. Many people don’t buy cars at this moment, because they don’t want to waste hundreds of millions of dong on car tax.

    Ngo Tri Long, a renowned economist, said people hope the car prices would be decreasing once the tariffs are cut. However, sharp price decreases may not occur, because the car prices not only depend on import tariffs, but also on luxury taxes, fees and pricing strategies followed by car distributors.

    “In Vietnam, you’d better not dream of cheap cars,” he said.

  • Japanese automakers consider leaving Vietnam due to weak supporting industries

    Japanese automakers consider leaving Vietnam due to weak supporting industries

    The companies are looking for bigger profits in nearby countries such as Thailand. Japanese automakers may be shifting their production away from Vietnam in the near future due to its poor supporting industries.

    Vietnam’s supporting industries have stood still for years and that might cause Japanese companies in the country to change their investment approach, said Takimoto Koji from the Japan External Trade Organization (JETRO), a Japanese government-related organization that works to promote trade and investment by Japanese businesses overseas.

    Several automakers intend to stop assembling cars in Vietnam and import whole cars from nearby countries like Indonesia, Malaysia and Thailand instead, Takimoto said.

    Car import tariffs between Southeast Asian neighbors are falling rapidly and the new approach will secure bigger profits, he said.

    Under a new free trade agreement among the 10 members of ASEAN, car import tariffs were cut from 50 percent to 40 percent last year and will go down to 30 percent next year before being scrapped in 2018.

    Japanese companies Toyota, Mazda, Honda and Suzuki are competing in Vietnam’s auto industry, which produces around 250,000 cars a year, a modest number compared to those in nearby countries such as Thailand’s two million cars.

    According to experts, an automobile production line only becomes profitable when it delivers more than 200,000 cars a year.

    Japan registered $2.58 billion in investments in Vietnam last year, accounting for more than 10 percent of the total FDI pledges made in the country and making it the second biggest foreign investor after South Korea, according to figures from the Ministry of Planning and Investment.

    Vietnam’s FDI inflow hit a record high of $15.8 billion in 2016.

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  • Singapore retail sales up 0.4% in December

    Singapore retail sales up 0.4% in December

    Singapore’s retail sales rose 0.4 per cent in December 2016 compared to the same month in 2015, mainly due to higher sales of medical goods & toiletries.

    Stripping out sales of motor vehicles, retail sales went up by 0.3 per cent, the Department of Statistics said on Wednesday.

    Compared to November, the seasonally adjusted retail sales figure decreased by 1.9 per cent in December. Excluding motor vehicles, they rose 0.7 per cent.

    Notably, retailers of medical goods & toiletries reported 9.9 per cent increase in sales year on year. Surprisingly, motor vehicle sales rose only 0.9 per cent year on year.

    On a seasonally adjusted basis, motor vehicles sales recorded a dip of 11.9 per cent compared to November. Retail sales of computer & telecommunications equipment and department stores also fell 6.8 per cent and 2.2 per cent respectively over the same period.

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  • BMW Group achieves new sales record in China in January

    BMW Group achieves new sales record in China in January

    German automaker BMW Group announced on Friday that its sales in China achieved double-digit growth in January, hitting a new record.

    A total of 51,345 units of the premium brands BMW and Mini have been delivered to Chinese customers, representing a year-on-year increase of 18.2 percent.

    It is the first time the Bavarian automobile company delivered more than 50,000 units in a single month in China, the largest market in Asia for BMW Group, the announcement said.

    In January 2017, a total of 163,288 vehicles were sold worldwide, an increase of 6.8 percent year-on-year. Among them, 21,219 vehicles were delivered to customers in the United States, down by 0.5 percent compared with January 2016.

    “We’ve started the year well. We’re confident that the new models we’re bringing to market this year will ensure further momentum as the year goes on,” said Ian Robertson, member of the board of management responsible for sales and marketing.

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  • No strong recovery in Hong Kong retail sales until 2018

    No strong recovery in Hong Kong retail sales until 2018

    Despite a return of mainland Chinese tourists to mark the start of the Year of the Rooster, it might be too early to celebrate for Hong Kong retailers. Sales will continue to fall this year, according to industry observers.

    Thomson Cheng Wai-hung, chairman of Hong Kong Retail Management Association, estimates the territory’s retail sales will fall 3-4% on the year in 2017, an improvement from the 8% drop in 2016.

    Last year, retail sales fell to 437 billion Hong Kong dollars ($56.3 billion), marking three years of decline and the worst full-year slump since 1998. This was despite some signs of improvement when the decline in sales in December narrowed to 3% from a year ago as more mainland visitors spent their holiday in Hong Kong.

    “We might be getting closer to the end of the tunnel,” Cheng said on Thursday. But citing uncertainty in the global environment, such as a possible U.S.-China trade war, he expects the retail market to bottom out only in 2018 at the earliest. “It is hard to say whether it will be a recovery in L shape, V shape or U shape,” he said.

    There were winners and losers during the Chinese New Year holiday.

    Luxury retailers were hit by dwindling sales as Chinese tourists tightened their purse strings amid a slowing economy. Prices in Hong Kong are also less attractive for mainlanders due to a weaker yuan and the Hong Kong dollar’s peg to the U.S. dollar, which had strengthened during the year.

    Chow Tai Fook Jewellery Group recorded an 11% slump in Hong Kong and Macau sales from a year ago between Jan. 14 and Feb. 3, which covered the Chinese New Year holiday.

    Mass-market retailers fared better. Hong Kong’s largest cosmetic chain Sa Sa International saw a 3.5% sales increase at home and in Macau from Jan. 28 to Feb. 3, helped by a rebound in mainland tourist traffic. While the number of transactions they made increased, the average spend per transaction was down 4.6% from a year ago.

    Given the latest data over the holiday season, Chairman and CEO Simon Kwok Siu-ming is upbeat on the outlook. “It is recovering, and December was almost flat [compared to a year before],” he told Nikkei Asian Review on Tuesday.

    He is positive about mainland customers as well. “I am not worried about China and the Chinese economy,” he said. Ease of travel to Hong Kong in the near future with the expected opening of a high-speed railway link and bridge connecting to Macau and Zhuhai in southern Guangdong province will make the territory “more accessible” for mainlanders.

    Some mid-tier fashion retailers are turning to e-commerce to expand their reach. Walton Brown, a subsidiary of Lane Crawford Joyce Group that has a portfolio of premium brands including Kate Spade and Brooks Brothers, will launch in March its own mobile platform MyMM.com to target China’s growing middle class.

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