Sluggish retail sales fail to affect OmniaLuo's growth in March
April 16, 2008 - China
The U.S. Department of Commerce reported that retail sales in March grew at a sluggish pace, evidencing a continuing economic slowdown, but that's not the case in China where OmniaLuo Inc just opened 24 stores in March.
Shenzen-based OmniaLuo, a high-end fashion chain carrying original designer clothing, is the brainchild of founder Cindy Luo, an award-winning Chinese fashion designer who's on a fast-track expansion with an aggressive goal of opening 66 new stores this year.
"Our success in March signifies not only a new Company best -- a full 60% increase over our prior record of 15 stores in February of 2007 -- but it also serves to kick start our growth prospects for 2008 and beyond," said Ms. Luo.
While the designer-turned-retailer was excited about OmniaLuo's growth, in the United States retail sales have slowed to a snail's pace.
In a press release issued Monday, National Retail Federation
(NRF) Chief Economist Rosalind Wells said, "Unseasonably cooler weather created a challenging sales environment for many U.S. apparel retailers last month."
The U.S. Department of Commerce
reported Monday that retail apparel sales shrank 0.5 percent in March while excluding automobiles, gas stations, and restaurants, total U.S. retail sales shrank 0.9 percent unadjusted over last year and were down 0.3 percent from the prior month.
Though Ms. Wells chalked up the decline in U.S. retail sales to weather, Ms. Luo noted that OmniaLuo's growth took place on the cusp of the Chinese New Year in January and February when sales there are historically lower. OmniaLuo, Inc. now has 211 retail stores open with a goal of 250 for the year.
While in the U.S., retailers are facing a dismal spring, in China the economy grew at its slowest pace in more than a year and inflation stayed close to an 11-year high, Bloomberg reports. Still, China is now ranked as the second largest economy in the world behind the United States and consumers are showing their thirst for trendy, high-end clothing.
OmniaLuo's chairwoman sees her company positioned to become the Chinese brand equivalent of Donna Karan or Liz Claiborne. "We are extremely optimistic about our Company's future," said Ms. Luo.
OmniaLuo's sales in 2006 were $1.5 million, growing to $7.5 million last year with a net income of $2.2 million. The high-end clothing retailer forecasts doubling its results this year.
Behind Ms. Luo's optimism is a Chinese clothing market where in 2005 women's apparel sales reached $25 billion, which is forecast to grow at a rate of 25 to 29% annually over the next five years. OmniaLuo's segment represented 12% of the Chinese women's apparel market, or $3 billion in 2005.