China’s economy may be feeling some chills these days, plagued by slowing growth that’s dampening consumption and leading to cutthroat competition in many consumer sectors. Despite that, leading down apparel maker Bosideng International Holdings Ltd. (3998.HK) managed to stay warm over the summer with financial results that look quite solid in such an uncertain climate.
The company’s revenue for the six months through September rose 17.8% to 8.8 billion yuan ($1.21 billion), while its profit flew ahead by an even faster 23% to 1.13 billion yuan, according to its interim report released late last month. Bosideng’s ability to grow in such a chilly retail market has everything to do with an important decision the company made in 2018.
That key pivot saw it shifting focus from the mass market to the high-end, chasing the popular Canada Goose (GOOS.US) brand that has found a comfortable niche in China selling pricey down coats, vests and jackets costing hundreds or even thousands of dollars. In making the shift, Bosideng is trying to distance itself from Chinese clothing long known for its poor design and low quality, only offering low prices to compete with foreign brands.