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Urban Outfitters to Exit China Market

Urban Outfitters is the latest international mass market brand to see their plans hit a snag in the China market. Urban Outfitters

The US retailer issued a statement on Tmall on Wednesday announcing its flagship store on the platform would shut down. Its products will be removed from sale on September 12 and customer service will remain operational until September 24.

Urban Outfitters has not yet set up any physical store footprint in China and is not available via any other e-commerce channels, which means its Tmall store closure also marks the brand’s departure from the China market. The Urban Outfitters Tmall store currently has about 1.14 million followers.

Later, the brand posted an explanation on its official Weibo account which said the move was “temporary” and due to a global strategy adjustment.

International mass market brands face serious challenges in China. Asos, New Look, Topshop and Old Navy have exited the market, C&A sold its China business last year, Bershka, Pull & Bear and Stradivarius, three Inditex brands, closed all of their physical stores and Mango has announced a moratorium on opening new stores. Meanwhile, H&M’s China sales fell 32 percent in the second quarter, though the fall was largely attributed to the controversy over its stance on the use of Xinjiang cotton.

Competition from local mass market players has intensified in recent years, as has the rise of low cost, online-only sellers utilising platforms such as Tmall and Taobao. The pace of production found among Chinese fast fashion players is difficult to match. Alibaba’s new manufacturing platform, Rhino Factory, for example, has shortened the design to delivery process to seven days.

In spite of the intense competition, China’s $200 billion apparel market remains coveted, and foreign fast fashion players will continue to find ways to crack it. On August 4, Forever 21 announced its return to China for the third time, licensing its operations to Lasonic Limited. Its first foray this time around involves selling on flash sales and group buying platforms, Vipshop and Pinduoduo, while planning to open a Tmall store and physical outlets in the future.

Learn more:

Forever 21 Makes China Market Comeback

Forever 21 is returning to China, following the brand’s high-profile exit from the country in 2019, according to an announcement posted Wednesday evening on its official Weibo account.

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