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Shanghai SuperBrand Mall Walk



June 18, 2011 – Comments (1) | RELATED TICKERS: YUM , NKE , CROX

Shanghai SuperBrand Mall (Pudong)

Just got done with one of the many mall walks I do while traveling (I hate the mall in the US, but generally enjoy the experience abroad). Spent about three hours in the SuperBrand mall, which is in Pudong near the Huangpu amid many luxury hotels and tier 1 office properties -- so this is high end consumer stuff. It's also Saturday and it's raining here, so as you might expect the mall was packed -- giving me a pretty good sample size for checking out the appeal of certain brands and stores to China's richest consumers. The mall is also massive -- 10 floors of shopping, restaurants, arcades, and an IMAX movie theater.

Who’s hot and who’s not? Read on to find out…

Fast Retailing
Happy to say that this current GG recommendation was hitting it out of the park. Uniqlo store on 3F was in a prime spot, packed with customers, and the line to buy was 10 deep the entire time we were in the store, but moving rapidly thanks to very efficient staff. Prices ranged from RMB59 ($10) for T-shirts to a few hundred RMB for dresses and nicer clothes. That said, lots of good deals -- and I even walked out of there with a linen shirt for RMB99 (can't beat that price!).Also happy to say that I dropped by H&M and Zara, which I consider relevant comps, and Uniqlo was blowing them out of the water in terms of traffic and commercial activity. Obviously, it's just one store, but I was a happy shareholder today seeing the success they were having. If this concept can grow rapidly in China, then the stock is a real bargain at present prices.

Toys R Us
Chinese consumers can be notoriously stingy about a lot of things (try to get them to pay for something on the Internet), but when it comes to their (one) child, they are spendthrifts. Toys R Us was packed with threesomes (mom+dad+child) buying everything from puzzles to games to dolls to robots -- robots were very popular. Interestingly did not see any video games, so the concept here is really catering to under-12s.

Din Tai Fung
Food is awesome (great soup dumplings). People were waiting out the door throughout both dinner last night and lunch today (yes, we’ve already eaten there twice). I don’t believe it’s possible to invest in Chinese operations, but Singapore-listed Breadtalk Group has some expansion rights to the concept outside of China. Unfortunately the Breadtalk Group Breadtalk location in the 1F food court was bereft of customers.

YUM! Brands
Both Pizza Hut and KFC, which here were relatively fancy sit-down places, were mobbed throughout lunch. Pizza Hut was pushing a RMB40 pizza deal.

I’ve looked at this Japanese lingerie company in the past for many of the same reasons I own Fast Retailing -- knowledge of Asian tastes gives it a leg up as it seeks to expand in China. I’ve avoided it thus far because closely-held Triumph is also doing well here, but the activity around the brand today may be reason to revisit it. Of course, the fact that they were hosting a fashion show probably helped in that regard (don’t miss the video).

Not sure why, but was wildly crowded with people buying the shoes.


Inditex and Hennese & Mauritz
Already mentioned it above, but their flagship stores were dead relative to Uniqlo.

Adidas and Nike
Very little interest around the sporting goods brands. Obviously we know the Adidas numbers are doing decently here, but unlike Uniqlo, the branded sportswear was extremely expensive. No price break from what you’re paying in the U.S., which is a stretch even for buyers in Pudong. Might be nice to see Adidas try to do a more local execution at some point with lower-priced goods (maybe they can use Reebok for that?).

Columbia Sportswear
These western concepts were also all very quiet on what was otherwise a very packed day at the motel.

You can find the video on our microsite:

And the photos on the microsite or flickr:


1 Comments – Post Your Own

#1) On June 18, 2011 at 5:56 PM, portefeuille (98.67) wrote:

Inditex and Hennese & Mauritz
Already mentioned it above, but their flagship stores were dead relative to Uniqlo.


Zara owner Inditex sales buoyed by India, China


The company has expanded from the first Zara shop opened in northern Spain in 1975 to more than 5,000 stores in 77 countries, including brands like preppie label Massimo Dutti and youth fashion chain Bershka.

Asia saw one of the most rapid rates of expansion last year with the group's retail presence there growing to 645 stores, accounting for 15 percent of sales, up from 12 percent last year. Inditex will open around 120 stores in China this year.

"2011 will be a year of strong acceleration in China," said Chief Executive Pablo Isla, who is expected to replace septugenarian founder and Spain's richest man Amancio Ortega as chairman in July.





Inditex’s FY2010 net sales rose to 12,527 million euros


Asia saw one of the most rapid rates of expansion. Openings there totalled 160, bringing the Group's retail presence in Asia to 645 stores, which now account for 15% of sales. 

Zara made its first appearance in India to an extraordinary welcome from customers in one of the three new markets the Group opened in 2010. Further launches are planned for 2011 in Delhi, Mumbai, Bangalore and other Indian cities.

In China, the Group opened 75 stores, expanding its China store map to 30 cities, and plans to increase that number to 42 in 2011. This dynamic growth is particularly significant at Group formats, which were very active in 2010. Bershka, Pull&Bear and Stradivarius unveiled 15 outlets, respectively, in the Asian country in 2010 alone, while Massimo Dutti opened a flagship in Shanghai. 



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