Shanghai La Chapelle, one of the largest fashion chains in China, has reported a stunning 25 per cent increase in sales and profit for 2014. The improved performance was due to an expanded retail network and same store sales growth.
Group revenue grew 25.5 per cent to RMB7,814 million (US$1.248 billion) in 2014, compared to about RMB6.225 billion in 2013. Gross profit rose 25.2 per cent to RMB 5,364.5 million (US$856 million). At the end of 2014, the number of retail points of the group increased to from 5384 to 6887.
Gross profit of was stable, with a slight 0.1 percentage point decrease to 68.7 per cent, mainly attributable to a higher proportion of the sales of past season products in 2014 than that of 2013 and an increase in provisions for inventories.
La Chapelle VP Wang Yong said China’s retail environment was adversely affected by the slowdown of GDP growth, persisting contraction in the spending momentum and structural change in the market.
In a year when apparel chains fared poorly in China, La Chapelle said that by expanding its retail networks it achieved growth in both revenue and net profit.
During the year, the group’s active expansion of its retail network brought significant results growth. The group said it has adopted “a series of strategies to further seize market opportunities and increase market share”.
“For example, we continued to execute our multi-brand strategy, to optimise the retail channel management system, implemented a retail-oriented strategy, rolled out a number of new management information systems to further increase our operational efficiency, dedicated to the launch of O2O business and a partnership system,” said Yong..
“All the above has paved a solid foundation for the group’s long-term strategic development.”
The company’s eight brands – La Chapelle, La Chapelle Sport, 7.Modifier, Candies, La Chapelle Homme, La Babité, La Chapelle Kids and Pote – cover ladies wear, menswear and childrenswear, enabling the group to access a wider customer base and diversify its revenue sources.
In 2014, 66.5 per cent of the group’s revenue was generated from the sales of La Chapelle and La Chapelle Sport, mainly attributable to the longest brand history and the highest level of customer loyalty and recognition of these two brands. On the other hand, the other brands displayed a faster growth in comparison, in which their contribution of the group’s revenue increased from 26.3 per cent in 2013 to 33.5 per cent in 2014.
