German sportswear company Puma is to shut 90 stores in China.

The decision is part of the company’s strategy to cut costs after losing US$45.8 million in the fourth quarter of 2012. Since the Beijing Olympics in 2008, the sportswear sector in China has been experiencing weakening sales.

“The age of high profit and growth rate in sportswear industry has gone so it’s difficult for sportswear companies to follow the developing model to largely open new stores,” said CEO Zhang Qing of Key Solution Sporting Consulting.

Even domestic players have also been struggling to perform brightly as e-commerce takes away customers from traditional stores. Local sportswear company Anta shut down 110 stores last year while both Peak and Li Ning closed more than 1000 stores.

“In order to fit for the current market, sportswear companies have to put part of their sales online channel,” one analyst told National Business Daily.

On the contrary, US sportswear company Nike said it will open 40 to 50 factory stores this year, offering discounts of up to 70 per cent to clear its inventory. Reports say the factory store openings will pose challenges for rivals which are also trying to reduce inventories.

“Other sportswear brand stores or discount outlets have difficulty surviving around Nike’s factory outlets,” said an employee from Anta to National Business Daily.