Desigual strengthens its business in China with a joint venture
The Spanish fashion company is looking to grow in the Asian market. In order to expand its online business in China, the company led by Thomas Meyer has entered into a joint venture with E-Shine, a local partner of Septwolves Industrial. In addition, through this partnership, Desigual intends to develop its physical retail presence by opening 60 company-owned and franchised stores, including two flagship stores in Shanghai and Beijing.
Over the next five years, Desigual plans to increase its turnover in China to €40 million, half of which will come from the physical retail business and the other 50% from online sales. "This collaboration is in line with our strategy to continue developing our business in the Asian market, growing in China, in Japan, which is our leading market outside Europe, and in other relevant countries such as South Korea," said the company's CEO, Alberto Ojinaga, in a statement.
This is the first time since Desigual was founded in 1984 that the brand has opted to form an alliance of this kind, placing its trust in a strategically positioned local partner. "Knowledge of consumer habits and preferences in the Chinese market is key to success," added the executive, stressing that challenges lie particularly in growing in the digital sphere and attracting new customers. The Barcelona-based brand's presence in the Chinese market dates back to 2014, when it launched on the e-commerce platform Tmall.
According to Ojinaga, the brand's goal is that "sales generated through the digital channel and outside Europe should represent a combined 60% of turnover by 2023." To date, these markets account for 49% of total sales. The Asian market accounts for 6.5% of Desigual's international business and Japan is its fifth largest market in terms of turnover.
Operating in a total of 109 countries through 10 sales channels and 393 mono-brand stores, Desigual currently employs more than 2,600 people worldwide. At the end of the last fiscal year, the company returned to profit and recorded a turnover of €371 million, 3.4% higher than the previous year.
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