Sportswear brand and retailer Puma is bracing for consumer backlash against more Western brands in China, following comments made about sourcing of cotton from Xinjiang and human rights abuses against Uyghur Muslins, according to Reuters.
The business had been enjoying sales growth of 40 per cent in Greater China during the beginning of the first quarter of the year, but this slowed to 26 per cent as online backlash against Western brands intensified in the region.
“We can still see that trend is continuing. There is less activity in the Western brand stores than there would have been if tension wasn’t there,” Puma chief executive Bjorn Gulden said, according to Reuters.
Earlier this month, the Chinese government denied the allegations of human rights abuses in Xinjiang after the United States, European Union, Britain and Canada imposed sanctions.
Swedish fashion firm H&M was singled out by Chinese state media for posting on social media about its concerns in Xinjiang in 2020. Many local internet users have said they will no longer support Western brands that take a stance on the issue, with one user writing, “if you boycott Xinjiang cotton, we’ll boycott you.”
And, due to congestion at ports and container shortages, Puma is having difficulty getting product into other markets, with many shipments delayed by at least two to three weeks and impacted by soaring freight prices.
However, the business remained optimistic about its full-year sales, which it expects to grow in the “mid-teens” and bring more profitability than FY20.