Wednesday, December 13, 2017
Authors Posts by Daisy Li

Daisy Li

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Covering red carpet events and interviewing celebrities (well, trying!,) designers and high-profile personalities for InsideRetailAsia.com. Sitting in on weekly edit meetings and pitching original content for the site. Compiling photos and text for news roundups, trend stories and market posts.

in-retail-asia

Prada SpA reported first-half revenue that missed analysts’ estimates as demand for its handbags and wallets in Hong Kong and Macau continued to wane.

Sales rose 4 percent to 1.82 billion euros ($2 billion), the Milan-based luxury goods maker said Friday in a statement. Analysts predicted 1.87 billion euros, based on the median of nine estimates compiled by Bloomberg.

The Asia-Pacific region, Prada’s most important market, showed a “similar negative trend” to the first quarter, when Greater China sales fell 19 percent excluding currency effects, Prada said. Revenue in its wholesale business dropped 14 percent as Prada has trimmed its network of distributors. The company is also opening fewer stores and introducing more bags priced between 1,000 euros and 1,200 euros as it attempts to reignite demand amid a clampdown on extravagance in China.

Sales were “worse than feared,” said Luca Solca, an analyst at Exane BNP Paribas. The company’s efforts to broaden its focus beyond high-priced products should leads to improvements in the second half, he said. “We expect to hear less and less bad news from Prada.”

The stock has dropped 30 percent in the past year, compared with a 52 percent gain in LVMH Moet Hennessy Louis Vuitton SE, the world’s largest maker of luxury goods.

Prada Struggles – Bloomberg Online

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india-retail-news

Aditya Birla Retail, the retail company owned by Aditya Birla group, would take at least two more years to become profitable at the before interest, tax, depreciation and ammortisation (Ebitda) level, said an executive in the know.

“Most of the stores are profitable. Now they have to take care of some overheads at the corporate level to become profitable,” said the executive who did not want to be named.

Set up in 2007, Aditya operates 483 supermarkets and 16 hypermarkets under the ‘more’ brand. It was originally looking to break even in 2012-13.

“Turnover has doubled from last year and same-store growth has been robust,” said the executive. A mail sent to the Aditya Birla Retail spokesperson went unanswered.

“They are carrying forward heavy losses. Till the time they get the format right, it is difficult to achieve profitability,” said Arvind Singhal, chairman of Technopak Advisors.

Other retail chains that started during 2006-2007 or started expanding in these two years like Bharti Retail, the Tata-led Star Bazaar and Spencer’s Retail are yet to achieve profitability
Companies

Retail News India – In Retail Asia

online-retail-asia

Entrepreneurs are forgoing the idea of setting up a physical store as more consumers prefer the convenience of shopping online and collecting the items at a suitable place or having it delivered to them.

The current trend of shopping via social media channels has become increasingly popular, said Syahwal Nizam Hj Yani, owner of social media-based business Macam-macam Sale Brunei.

AsiaOne Women

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retail-news-china
Shanghai La Chapelle Fashion, the multi-brand retailer with 6,887 stores across greater China, has rebranded itself with an “elegant, classic, and romantic” new image. The company unveiled a new logo inspired by French architecture, a motif that will influence the brand’s in-store design and product branding, according to Inside Retail Asia. “Influenced by European temperament…”

Luxury Retail News – In Retail Asia

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retail-news-indonesiga

Indonesia Retail Market Still Has Strong Appeal, Index Shows

Indonesia Gets Its Highest Ever Ranking in A.T. Kearney’s Retail Index

Indonesia achieved its highest-ever ranking in an index released by global management consultancy A.T. Kearney that measures retail investment worldwide, as retailers seek to expand in the country to tap the burgeoning middle-income population.

According to the 2015 Global Retail Development Index (GRDI), Indonesia has risen three positions to 12th place, its highest spot on the index since it was first published in 2001, A.T. Kearney said in a statement on Monday.

The index, which analyzes 25 macro-economic indicators and retail-specific variables, ranks the top 30 developing nations for retail investment worldwide. It aims to identify investment opportunities in emerging markets.

“The GRDI’s findings confirm the mid-term optimism of many of Indonesia’s and the world’s leading retailers in the country’s potential,” says John Kurtz, president director of A.T. Kearney Indonesia.

“The growing middle class, coupled with consumers’ embrace of multiple formats and channels bodes well for Indonesia’s growth in the future. All eyes are on indices such as this to determine whether Indonesia will finally mature to become the market that everyone has been hoping for,” he adds.

A.T. Kearney said it expected Indonesia’s economic growth to rebound after reaching a five-year low last year, and “should outpace other regional markets.”

“Despite a slight decline in retail sales per capita last year, total retail sales grew 14.5 percent. The sector has got off to a sluggish start in 2015 but retailers continue to be drawn to Indonesia’s large population and growing middle class,” the consultancy said in the statement.

It estimated that Indonesia’s retail market was currently worth $326 billion.

Still, the company says Indonesia need to improve its retail infrastructure and have a more favorable regulatory environment to help spur investment in the sector.

More here, at The Jakarta Globe.

Retail News Asia – In Retail Asia

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China-luxury-sales
Based on feedback from the experts on the ground in China, it seems as if no turnaround in sales at luxury retailers is on the horizon.

There is plenty of blame to go around for the drop-off in Chinese luxury-sales growth during the past several years. While most are pointing fingers at the anti-corruption campaign, unrest in Hong Kong, global currency fluctuations or general economic slowdown, a few additional concerns hit my radar screen.

American-style discounts have become the new reality for the younger consumer and retailers need to adjust, particularly as average prices in Asia can be higher than those in Europe or the U.S. by 30 percent or more. If Chinese consumers don’t see more discounts at home (and not just the last-minute 50-percent off deals) they will continue to shop abroad, leaving stores on the mainland increasingly empty. That raises the question: Is there too much luxury brick-and- mortar capacity on the mainland?

CNBC – China Luxury

China Retail News – In Retail Asia

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china-retail-news
Slow and Steady Wins the Race for Foreign Brands Expanding in China
Due to the complexity of the Chinese retail market, international brands looking to sell in China must be patient and do their due diligence if they hope to have success in the country, according to a report by CR Retail. Though companies often blame China’s anti-consumption measures for poor sales, it is more likely that it is more likely that a lack of understanding of the Chinese market is to blame, reports Luxury Daily.
Central to the luxury business in China is online shopping and the influence of social media on luxury purchases. Not only do the brands need to establish a presence on websites like Alibaba’s Tmall or JD.com, along with Weibo and WeChat, but if they are going to launch their own web portal in the country, they must be aware that China’s internet firewall has been a major headache for retailers in the past.Red Luxury

China Retail Market News – In Retail Asia

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retail-sales-china

Prada had 33 stores in China in the first quarter of this year, down from 49 in 2014. Armani locations fell from 49 to 44. There are 11 Chanel boutiques in the country, about half the number before.

“Western luxury retail in China is fading fast, and I predict a lot more luxury shops will have to close,” saidSir David Tang to the Financial Times this month. “There will be a lot more pain to come in the next two or three years.”

Not everyone agrees with Sir David. Carlby Xie of Colliers China believes lux brands will not close down China locations.

Even though David Tang has reason to run down the competition—he was the driving force behind Shanghai Tang after all—his predictions look much closer to the mark than Xie’s. There is no doubt that across China luxury brands are in retreat.

It’s not that the Chinese don’t crave lux items—they may account for 46% of the world’s spending on them—but they make about 76% of their lux purchases outside their country. As the official Xinhua News Agency reports, “designer stores in China have come to serve as mere showrooms.”

In the future, luxury locations in second- and third-tier cities will be shuttered. Brands, however, will keep their flagship stores in Beijing and Shanghai so that the wealthy can figure out what they will buy when they go abroad to shop.

In China, The Devil Now Wears Zara – Forbes

China Luxury Retail News – In Retail Asia

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retail-news-asia

Prada SpA reported first-quarter profit that trailed analysts’ estimates as the Italian fashion house struggled to reverse a slump in sales in China.

Net income in the three months through April fell to 58.7 million euros ($65.7 million) from 105.3 million euros, Milan- based Prada said Friday in a statement. Analysts predicted 85.2 million euros, based on the average of eight estimates compiled by Bloomberg.

Prada is opening fewer stores, shuttering some wholesale accounts and introducing more bags priced between 1,000 euros and 1,200 euros as it attempts to reignite demand amid a clampdown on corruption and extravagance in China. First-quarter revenue rose 6.5 percent to 828.2 million euros as the weakness of the euro compensated for anemic growth in the Asia-Pacific region, Prada’s most important market.

Prada Profit Tumbles…

In Retail Asia – Retail News for China and Beyond

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