Xiniya Fashion axes 685 stores

Chinese menswear chain Xiniya Fashion culled 685 stores last year as part of a major restructure to restore profits.

It says it opened 180 new retail outlets and closed 864 plus one flagship outlet.

The result was a 38.4 per cent decline in revenue to RMB813.1 million (US$131 million), compared with RMB1.32 billion in 2013.

It posted a net loss of RMB170.7 million ($27.5 million), compared with a net profit of RMB97.2 million in 2013.

Fourth quarter revenue was down 58.6 per cent

“We continued to focus on stabilising our retail network during the quarter as China’s economy enters a period of slowing growth and the menswear industry faces a crisis of excess capacity and intense competition,” said Qiming Xu, Xiniya’s chairman and CEO.

“We completed the first phase of our inventory buyback from our distributors during the quarter. Remaining flexible and adaptable is key to the future success of our strategy. We will continue to monitor our distributors and authorised retailers closely during the next phase, and may implement appropriate initiatives accordingly.

“We are making every effort to sell the remaining inventory, which is mostly composed of more recent products, through our retail network by offering discounts and promotions over 2015.

“We also implemented a number of cost cutting initiatives such as reducing advertising and promotional expenses during this transition stage. I am confident that these initiatives and changes to our business model will further strengthen our brand’s popularity and allow us to weather these difficult and unpredictable times.”