A Chinese giant dips a toe into the British retail market (China)

EARLIER this month a United States senator, angry that America’s Olympic games uniforms were made in China, suggested piling them up and setting fire to them. Bosideng, a large Chinese clothing retailer, does not seem too keen on the “Made in China” label either. On July 26th the firm will launch a new flagship menswear store near Bond Street, a posh shopping district in London. Fewer than 10% of the clothes will be manufactured in China—a lower share than in many West End shops.

The London store is not Bosideng’s first shop outside China. The firm owns Greenwoods, a Yorkshire-based clothing retailer, and between 2009 and 2011 it tested the waters with three pilot stores in small British towns (it concluded that larger cities were likely to be more receptive to its brand). The company paid just over £20m ($31m) for the freehold on its South Molton Street property, and spent nearly £10m renovating it. It will use the top two floors as offices for its future European operations. The slowdown in consumer spending does not worry the company: Bosideng assumes its wealthy target market is not affected by such niggling matters.

Bosideng is best known in China as a mid-market maker of warm jackets. But in Britain it will sell expensive dress shirts and trousers. It plans to trade on exclusivity by making no more than 50 pieces of any item. It may as well be a different brand. Indeed, there is surprisingly little that is Chinese about Bosideng London. Its line is designed by British designers and inspired by British style with Chinese elements, explains Jason Denmark, head of Bosideng retail in Britain. No items from Bosideng’s nearly 11,000 shops on the Chinese mainland will be available in London, and Chinese consumers eager to get hold of the London label will have to make the trek to Britain. Even the logo is different.

A shop in London is a way of signposting success. The hope is that visiting Chinese tourists will go back home and tell their friends about Bosideng’s fancy London store. Sir David Tang, a Hong Kong-based entrepreneur who established the Shanghai Tang label and China Tang restaurants, explains the strategy by using a Chinese phrase that translates as “soaked in salt water”. “If it has been accepted by the West, there is more incentive for people to buy it in China,” he says. Other Chinese brands also want to establish a presence in London’s shopping district, but they have been unable to find the right property, says Paul French, chief China analyst at Mintel, a market-research firm.

Floor space around the smart western end of Oxford Street is heavily sought after, extravagantly expensive and rarely comes up for sale. Bosideng is hoping it can convince shoppers that the same applies to its clothes.