Xtep International Holdings Ltd. (01368.HK) is looking to online sales as its new growth driver, the Hong Kong Economic Journal reported Monday, citing executive chairman Ding Shui-po.
The sportswear retailer already uses its online sales platforms as well as those on tmall.com and taobao.com to clear inventory and promote limited-edition lines. But these channels generate a low single-digit share of total income, Ding said.
Xtep will launch a platform aimed at Hong Kong customers in the second half but high rents mean the company still has no plan to open any physical stores in the city.
Xtep has been battered by consolidation in the mainland market, leading to a 25.2 percent decline in net profit last year. Sales orders for delivery in the fourth quarter and same-store sales growth in the first quarter were worse than those of its rivals.
Ding said Xtep will continue to adjust to shifts in the market this year, but he expects conditions to gradually improve and growth to return to the high rates reported during the 2008 Beijing Olympics as demand for sportswear grows steadily.
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