Steadily-growing Belle predicts positive outlook for sportswear in China
China’s biggest footwear retailer Belle International has reported a 9% rise in revenues for the year to the end of February to 40 billion yuan ($6.5 billion), but said rising labour costs and a slowing economy impacted profit.
Belle said in a statement: “The main challenges are more structural in nature, such as weak foot traffic. As such most retailers are not motivated to do more promotions than necessary. It is our view that, based on the existing business mix, the group is well-positioned to maintain a fairly consistent gross profit margin in the footwear business.”
The sportswear and apparel business increased by 17.2% to $2.7 billion. It grew at a quicker rate than footwear and now makes up about 42% of the business.
The company added: “In our view, with increasing participation in sports by Chinese consumers, there is a long term secular trend for increasing demand for sportswear products. Strong global sportswear brands such as Nike and Adidas are well positioned to strengthen their competitive advantage and capture market share in China, on the back of strong brand equity, industry-leading R&D, broad product line and superior supply chain. As a major partner of these brands we have the confidence to continue to ramp up investment and improve quality of operations.”
Company-owned footwear business include Belle, Teenmix, Tata, Staccato, Senda, Basto, Joy &
Peace, Millie’s, SKAP, :15MINS, Jipi Japa and Mirabell. Distribution brands include Bata, Clarks, Hush Puppies, Mephisto, Merrell and Caterpillar.
The majority of the sportswear and apparel business is in the form of retail distribution, including Nike and Adidas, PUMA, Converse and Mizuno.
