Fashion brand Ted Baker has formed a joint venture to expand its network in Mainland China, Hong Kong and Macau.
A new company will take over the three Ted Baker China stores already operating in Hong Kong and the six on the mainland. It will operate all Ted Baker future stores, concessions and online channels in the three geographical markets.
Ted Baker will invest about RMB30 million (£3.4 million) in the new venture, which will be co-owned with Shanghai LongShang Trading Company (LS). LS will assign its rights under the JV to a newly incorporated Hong Kong investment vehicle to be wholly owned and formed by LongGoal Holdings and Infra-Apparel Group.
Lindsay Page, acting CEO of Ted Baker, said the company is excited about the growth potential for the brand across China.
“Over recent years we have invested in introducing the Ted Baker brand to Chinese customers, and we are confident that the creation of this JV will build on this platform and deliver meaningful long-term growth. In LongGoal and Infra-Apparel, we have extremely capable partners that bring local market expertise to our brand and already well-established design, buying and merchandising skillset.”
Page said the brand firmly believes China has the long-term potential to become one of the largest single global territories for the Ted Baker brand.
The Ted Baker China JV will have six directors, evenly split between Ted Baker and the JV Partner. The JV is expected to break-even in the 2021/22 financial year.
In a statement, Ted Baker said LongGoal and Infra have a wealth of experience in digital marketing, e-commerce operations and building successful joint ventures in China.
Infra-red has expanded the Golfino brand to 60 stores across China during the last five years and has strong digital-marketing and e-commerce operations experience.
LongGoal is the current distributor of Gant, operating more than 165 directly owned and 25 sub-franchised locations in China, along with 44 directly owned and franchised Bebe stores.
The new joint venture will be focusing on expanding the Ted Baker brand into tier 2 and 3 Chinese cities.
Chen Xiaoling, chairwoman of LongGoal, said Ted Baker’s global lifestyle appeal has resonated well in China, and the company is confident in its ability to grow it further and faster.
“In more than 20 years, LongGoal has amassed an infrastructure and presence in more than 65 cities, which presents a strong, compelling and proven platform that Ted Baker China can leverage. The transformational JV we’ve forged brings together a leading brand, strong management team and unparalleled opportunity to expand Ted Baker into cities that desire its fresh vision of style,” she said.
Jing Yin, co-founder and chairwoman of Infra, described Ted Baker as an amazing brand that her company has admired for a long time.
“[Ted Baker] has already demonstrated its relevance and appeal in the Chinese market. Our knowledge and experience in building fashion brands through stores, concessions and online should prove invaluable to Ted Baker and we look forward to working together.”
The new venture is condition on approval from Chinese regulatory authorities.