Following the adoption of a new operating model since the middle of this year, the retailer has seen sales increase by around 60 percent, boosting the monthly revenue of a single store to between 12 million and 13 million Chinese yuan from 8 million yuan before, he added.
Tsann Kuen hopes its new business strategy will help its retail business in China break even by October next year, Huang said, noting that the company has received positive support from Taiwanese lenders such as Taishin International Bank (台新銀行) and Chinatrust Commercial Bank (中國信託). These banks, however, declined to comment.
To analysts, the clearance of inventory is the key issue to the retailer's future success.
"The company's retail business in China will see better performance only when they improve inventory management," said Chen Yen-liang (
"Tsann Kuen is still groping for ways to be successful in China like it was in its home market," the analyst said on condition of anonymity. Whether Tsann Kuen's new strategy will pay off is yet to be seen, he said.
But the company's advantages -- entering the China market early and a common cultural background with Chinese -- should help it withstand competition from foreign players once China lifts its restrictions over foreign capital's direct investment in the country's retailing this month, the analyst added.
RSS