In an interview with ‘China Daily’, Jason Denmark, director of retail operations at Bosideng UK, said the company hopes to capture Western sensibilities in its new lines: "What we will achieve is to dovetail a subtle combination of Chinese and UK fashion-influenced design, using mainly European fabrics and manufacturing processes, to create this unique collection."
The company highlighted that their main goal is to integrate more Chinese elements in the design of products sold in the UK market. Analysts, however, dissent, highlighting that the move might respond to an effort to reduce costs.
Is Bosideng divesting from the UK?
The Chinese apparel giant is reportedly laying off the staff in its UK headquarters, including its London purchase and design team. The move has been defined as an “strategic adjustment” by Bosideng. The production of products will be handed over the Chinese team in the future, in an attempt to reduce costs, as analysts have pointed out in many occasions.
Bosideng, operating around 10,000 stores and one of the largest clothing operations in China, invested 30 million pounds into its first store on South Molton Street in London, which opened in September 2012.
It is worthy a note that in March, Bosideng International Holdings Limited announced the group expects to record a low double digit percentage decline in the consolidated revenue for the financial year ending 31 March 2014, from 2013, due to “fierce competition in the down jacket industry and higher than normal winter temperature in most areas in China last winter.”
The company expects its consolidated net profit to record a larger extent of decline than that of the revenue due to the continuous increase in operating expenses. Consequently, Bosideng International advised its shareholders and potential investors to exercise caution when dealing in the securities of the company.
"Although Bosideng is a famous brand in China, its overseas brand recognition is not so high, resulting in low market reception. And the company must have invested a lot in marketing there, which likely generated some financial burdens," Yan Qiang, a partner with Beijing-based Hejun Consulting, told the ‘Global Times’.
As per Bosideng's interim report, the down apparel business accounts for 62.5 percent of the total revenue during the six months ending September 30, 2013, coming in at 1.76 billion yuan. The figure is lower than that of a year ago, down 4.7 percent year-on-year.