The Business of Fashion
Agenda-setting intelligence, analysis and advice for the global fashion community.
Agenda-setting intelligence, analysis and advice for the global fashion community.
Baozun e-commerce, a service provider of brand e-commerce in China for luxury clients including Gucci, Burberry and Farfetch, has acquired consulting management firm, Full Jet, which has helped international fashion and sports brands, such as Adidas and Tommy Hilfiger, formulate offline distribution plans for the China market.
The total value of the acquisition was not disclosed, though it represents 1.25 times Full Jet’s 2020 tax, interest, depreciation and pre-amortisation profit (EBITDA).
As of September 30, 2020, Baozun e-commerce’s gross merchandising value (GMV) in the third quarter increased by 19.4 percent year-on-year to 10.85 billion yuan ($1.68 billion). Total net income reached 1.83 billion yuan ($283.15 million), an increase of 21.7 percent year-on-year.
With consumers tightening their belts in China, the battle between global fast fashion brands and local high street giants has intensified.
Investors are bracing for a steep slowdown in luxury sales when luxury companies report their first quarter results, reflecting lacklustre Chinese demand.
The French beauty giant’s two latest deals are part of a wider M&A push by global players to capture a larger slice of the China market, targeting buzzy high-end brands that offer products with distinctive Chinese elements.
Post-Covid spend by US tourists in Europe has surged past 2019 levels. Chinese travellers, by contrast, have largely favoured domestic and regional destinations like Hong Kong, Singapore and Japan.