(Filed Under wholesale Lingerie News). Cosmo Lady, a large producer and retailer of intimate apparel in China, that referred to itself as the “Oriental version of Victoria’s Secret,” has announced it “will venture to overseas markets to seek global business partners.”
The company seeks “collaboration with other well-known underwear brands,” and reported it had “gained the authorization from Walt Disney on several specially designed pairs of underwear,” in 2016. It also announced “It is the company’s ambition that in the future Cosmo Lady will hold an oriental version of Victoria’s Secret fashion show in the United States.”
With sales of about $740 million in 2015, the firm is publicly traded on the Hong Kong exchange, and claimed that in China, “With 1,032 retail stores newly opened in the year of 2015,” its distribution network is now “comprised of 8,050 retail stores in more than 330 cities. Cosmo Lady will continue its progressive expansion strategy of retail network in five major types of locations including commercial streets, residential neighborhoods, transportation hubs, school zones and supermarkets, in addition to high-end retail network in malls, department stores and shopping centers.”
By comparison, Victoria’s Secret’s parent, L Brands, reported sales of $12.2 billion in fiscal 2015. In all, as of the end of fiscal 2015, it was operating 990 Victoria’s Secret stores in the U.S., 128 Pink stores in the U.S., 37 Victoria’s Secret stores in Canada, 9 Pink stores in Canada, 12 Victoria’s Secret stores in the U.K., 2 Pink stores in the U.K. and 126 La Senza lingerie stores in Canada, for a total of 1304 company owned lingerie stores. In addition, at the end of fiscal 2015, partners around the world were operating 373 Victoria’s Secret Beauty and Accessories (VSBA) stores, 16 Victoria’s Secret stores, 3 Pink stores and 221 La Senza lingerie stores. The company also operates almost 2,000 Bath & Body Works shops in the U.S. and Canada and with partners internationally.
In May L Brands took over from partners in China, 26 of the VSBA stores, with plans to handle the expansion there itself.
In its 2015 annual report, Cosmo Lady explained that, according to business consultant Frost & Sullivan, the “China intimate wear market is a highly fragmented market with over 3,000 market players. In 2015, the company and its subsidiaries (the “Group”) ranked number one in the overall China intimate wear market with a market share of 3.3%, as it targets the largest and fastest-growing mass market, which brings significant growth on consumer demand. Overlooking the whole market, the Group has become the largest branded intimate wear company in China in terms of total retail sales in the past few years. Considering each major product category of the overall China intimate wear market, the Group ranked number one in terms of bra, underpants, and sleepwear and loungewear and ranked the second in terms of retail sales of thermal clothes in 2015. Among all mass market players, the Group is the only leading market player, with a market share of 6.4% in terms of total retail sales of intimate wear mass market in 2015.”
In the Cosmo Lady annual report, the company stated it expected 2016 to be a “challenging year” adding, “the Group is of the view that those market participants with lower brand awareness and competitiveness in the China’s intimate wear industry will be further marginalized or eliminated amid the fierce competition. In such an opportunistic environment, to capture growth potential arising from market consolidation, the Group will continue to explore an opportunity for inorganic growth in the industry.” The domestic challenges are a reason “The Group would also consider to expand its footprint overseas and collaborating with other reputable intimate wear brands,” among a list of other options.
The company concluded, however, that “Despite the uncertainties surrounding China in 2016, the Group has equipped to combat the up-coming challenges and prepared to further consolidate its leading position in the intimate wear market in China. In the longer term, the Group is optimistic on the prospects of the intimate wear industry in China backed by continuous urbanization, increase in consumers’ awareness on quality and branded intimate wear and rising population as a result of the new two-child policy in China.” — NM
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