Taking An Alternate Route To The Mainland

Esprit's red-chip joint venture will speed its expansion in China

Michael Ying, chairman of Esprit Holdings, knows all too well the frustrations of running a retail business in China. Ying's Hong Kong-based company, which controls the Esprit name in Asia and Europe, has opened 108 clothing stores in China over the past 4 1/2 years. But the returns so far have been less than stellar: The mainland shops still account for just 4% of sales. The vagaries of the market, Ying says, with different bureaucrats in different places issuing different diktats, make retailing a very hard nut to crack. "Every time you go to a new province or a new city, you never know enough," he says. "You're never quite sure."

To continue reading this article you must be a Bloomberg Professional Service Subscriber.