Christo Wiese is promising to open 500 of his New Look stores in just three years, catapulting the British brand into the same league in China as the world’s top fashion chains – Spain’s Inditex and Sweden’s H&M.
His plan is to make most of the clothes in China to ensure they cater to local tastes and can get to stores quickly – a strategy similar to the one successfully pursued in Europe by Zara-owner Inditex.
The arrival of New Look – and its local sourcing strategy – poses a new risk for the likes of H&M and Inditex, already suffering from slower growth in China, fierce competition for real estate and the cost of investing in ecommerce.
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H&M is opening more stores in China this year than anywhere else in the world and the country is already the second biggest market for Inditex outside Spain. China is a big draw for retailers who hope to tap the aspirations of a fast-growing middle class.
But recent history offers plenty of examples of failure. Western brands that have struggled in China include Gap Inc, Abercrombie & Fitch and Marks and Spencer , which decided last year to close five stores.
New Look, a chain founded in 1969 and bought last year by Wiese’s investment vehicle Brait SE, does not want to make the same mistake. It now runs 94 stores in China, out of a global total of 852, and hopes to have up to 150 by next March.
While New Look is cashing in on the popularity in China of British style – it is adding the “London” tag to its logo for its Chinese stores and website – it is also catering for local tastes.
Anders Kristiansen ran the China business of Bestseller before taking over as New Look chief executive in 2013. Kristiansen’s experience in Asia is one of the reasons behind the group’s aggressive expansion strategy.
(Source: The Fashion Law)