Tag Archives: Kingfisher

RETAIL: Britain’s Asos Crushed by China E-Commerce

Bottom line: Asos’ China retreat is due to the country’s extremely competitive e-commerce landscape, and shows that western retailers need to devote significant resources to succeed in the market.

Asos bows from China

In what looks like a first for a major western retailer, British fashion seller Asos (London: ASC) has officially pulled the plug on its China operations. Some might say that’s nothing new, since much bigger names like supermarket operator Tesco (London: TSCO) and electronics seller Best Buy (NYSE: BBY) have made similar moves in the last 5 years after failing to find a big enough audience among Chinese consumers.

But Asos is a different case, since it’s one of a growing number of western retailers that are choosing to come to China as a pure e-commerce plays, in a bid to save the huge costs involved with traditional stores and also take advantage of the nation’s online shopping craze. The problem is that China’s e-commerce craze has also attracted thousands of other retailers, and Asos couldn’t find a way to differentiate itself from the crowd. Read Full Post…

RETAIL: Toys ‘R’ Us China Toy Story — Real, or IPO Hype?

Bottom line: Toys “R” Us’ big China expansion plan contrasts with pull-backs and departures for many major western retailers in the tough market, and could be aimed at generating buzz in the run-up to a potential IPO.

Toys “R” Us steps up China expansion

China’s economy may be headed for a rapid slowdown that casts a chill on the retail sector, but don’t tell that to US veteran Toys “R” Us. The retailer whose name is synonymous with children and fun has disclosed it’s planning an ambitious China build-up that will see it increase its local store count by 30 percent this year, even as other major western retailers are closing shops and even leaving the difficult market.

All that leads to the question of whether Toys “R” Us really intends to open so many new stores at a time of uncertainty, or whether this China toy story is part hype with other motivations. If the latter is the case, this particular story could be designed at least partly to generate some excitement around an otherwise boring traditional retailer, as it gets set to potentially re-list in New York more than a decade after being privatized.  Read Full Post…

RETAIL: Bun Seller Gubuli Tries Coffee, Carrefour Weighs Sale

Bottom line: Gubuli’s foray into the coffee business is doomed to failure, while Carrefour is likely to sell part of its China business to a local partner later this year.

Gobuli tries coffee with Gloria Jean’s

You know the China coffee market is overheated when one of the nation’s most famous names in a traditional food like steamed buns enters the market. That’s what’s happening now, with word that Gobuli Group, a restaurant chain whose name is synonymous with a popular kind of meat-filled steamed buns, is launching a coffee chain joint venture in partnership with Australia’s Retail Food Group.

While the coffee business is quickly overheating, the opposite is true for the traditional supermarket business, which has seen several major western retailers leave the market or scale back operations as they face a growing challenge from e-commerce. Now it looks like French giant Carrefour (Paris: CA) could become the next in that trend, with word that it might consider selling some or all of its China business to a local partner. Read Full Post…

RETAIL: Kingfisher Bows From China, Leaves Behind B&Q Name

Bottom line: Kingfisher’s sale of control of its China home improvement chain to a local partner will produce an uneasy alliance that will ultimately see the UK retailer withdraw its B&Q name from the market.

Kingfisher hands over B&Q China to Wumart

Just weeks after US electronics retailing giant Best Buy (NYSE: BBY) made a final retreat from China, British rival Kingfisher (London: KGF) is making a similar move with word that it’s selling control of its China B&Q store operations to a local buyer. These 2 deals mark an interesting twist on a trend that has seen other global retailers like Home Depot (NYSE: HD) and Germany’s Metro (Frankfurt: MEO) also abandon the tough China market. Whereas the earlier cases saw companies simply close down their China operations and leave, this new wave of deals has firms selling their operations to eager Chinese buyers. Read Full Post…

Home Depot Packs Up China Toolkit 家得宝关闭在华所有大卖场

Just 6 years after coming to China, US home improvement giant Home Depot (NYSE: HD) is shuttering most of its China shops, becoming the latest major foreign retailer to discover that China’s 1.3 billion consumers aren’t quite the same as their peers in the West. Home Depot’s departure follows the equally high-profile closure of US electronics retailing giant Best Buy (NYSE: BBY) stores last year (previous post), and I suspect that the reasons for both companies’ failures are similar. Put simply, both Best Buy and now Home Depot discovered that price is by far the most important factor for Chinese consumers, who are always looking for the best bargains. Brand loyalty and customer service — 2 important elements that attract consumers to Best Buy and Home Depot stores in the West — are far less important to the Chinese.

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