Store-Check in China: Bosideng

Ute Holtmann, EHI Retail Institute, reports on her retail experiences in China

Foto: Bosideng-Store in Shanghai von außen

Shanghai is one of China’s 13 megacities. Practically everything is mega here – including the shopping options. One of the local shooting stars is down apparel manufacturer Bosideng. I was impressed by the rapid development of this company – and the way it communicates.

At the Bosideng store in Shanghai’s, I am first asked to visit the back office, where I take a look at the in-depth account of the company’s history with a distinct appreciation for the company’s founder Gaodekang. In a museum-like presentation in the back office, featuring the first sewing machine and a bicycle exhibit, the multiple award-winning entrepreneur plays a key role in Bosideng’s success story.

Using sewing machines and a bicycle to become a market leader

Bosideng Store innen - Nähmaschine und Frauentorso

It all began in 1976 with eight simple sewing machines and a bike, which the company’s founder Gaodekang used back then to personally deliver the first down jackets to his customers. By its own account, manufacturer and retailer Bosideng is China’s largest retailer for down apparel today, featuring approximately 7,500 retail outlets in the domestic market and now also one in London. Its core brands include “Bosideng“,”Snow Flying", "Kangbo" and "Bengen“. The brand portfolio of the corporate group offers a large variety of goods that caters to different customer segments. 

However, due to increased competition from brick-and-mortar retail and e-commerce, Bosideng recorded a drop of about six percent in the past fiscal year, down from prior double-digit sales gains. Recently, a serious competitor called Uniqlo from Japan, for instance, is making huge strides in conquering the Chinese market and attracting customers with lower prices.

Foto: Ute Holtmann im Bosideng Store

Ute Holtmann (r.) bei ihrem Storebesuch

Nevertheless, the company wants to stick to its pricing policy, according to a Bosideng manager. He adds that the quality of his company’s products is clearly superior. Instead, customers are knowingly attracted to the numerous stores of the fashion retailer with an extensive product expansion. The product choices at this point include non-seasonal casual wear for fashion-conscious men and women. In addition, the company wants to grow by proactively acquiring non-down apparel brands. 

Bosideng intends to battle the impressive growth rates of the e-commerce market with an online presence on Alibaba’s own platform Tmall, which is very popular in China, and by adding its own logistics and a comprehensive omnichannel strategy. Andy Zhao, Managing Director of GFK North East Asia, sees the success of the Chinese online market at least partially aided by the significantly lower prices. Many products are up to 20 percent less expensive online than they are at the store, Zhao stated at the C-star Conference in May. 

For its present logistics, the company admittedly no longer gets by with just one bike but it still is a perfect tool to communicate the success story. 

Author: Ute Holtmann, EHI, October 2016

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