Gap bucks retail headwinds with massive China expansion amid localisation drive
Amid widespread store closures by foreign fast-fashion players in China, US apparel brand Gap is defying industry headwinds. It plans to open 50 new stores in mainland China this year and return to Hong Kong by year’s end, following a localisation overhaul that has attracted more Chinese consumers. This expansion comes at a time when the world’s second-largest consumer market faces sluggish…
Gap, the US apparel brand, is bucking retail industry headwinds through a significant expansion in China. The company plans to open 50 new stores this year and return to Hong Kong by year-end. This comes as Chinese consumer market faces sluggish overall retail sales, with foreign brands like Zara and H&M cutting back on their store numbers.
Gap has undergone a localisation overhaul, attracting more Chinese consumers and recording its first profit in the fourth quarter of 2022. With Baozun, a Chinese e-commerce operator, taking over its mainland China, Hong Kong and Macau operations in early 2023, Gap has pursued its "China-for-China" localisation strategy and reported a record-high 20% same-store sales growth in the first quarter.
The brand's strategy includes opening stores in both first-tier and third-tier cities, as well as in the Tibet autonomous region. Analysts believe that foreign companies must undergo radical and structural localisation, devolving decision-making power to local teams and tailoring their merchandise to specific consumer segments in China's county-level markets.
Written by urgent.news from SCMP Business's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
This story
This is one outlet's version. Read the fullest account.
