Sa Sa International Holdings plans to speed up expansion on the Chinese mainland to tap surging consumer spending, Asia's biggest cosmetics retailer said yesterday.
Sa Sa growth blueprint calls for 100 stores on the mainland in the next five years, up for three today.
"The mainland business is producing strong growth in sales," said company spokeswoman Macy Leung. "Beijing and Chengdu will be Sa Sa's next stops following Shanghai."
The Hong Kong retailer launched operations on the mainland market last year. All of its present sales outlets are in Shanghai.
Another two will be opened in the city this week to cash in on the Christmas shopping blitz, and two additional local stores are scheduled to go into operation next year.
The company's goal for 100 Chinese mainland outlets will send Sa Sa's Asian store number to 240 by 2011, more than double the current 90.
"Soaring consumer spending has made the mainland an ideal market for overseas retailers," said Xiangcai analyst Fu Su.
The country's retail sales advanced 13.6 percent year on year to 6.89 trillion yuan (861 billion U.S. dollars) in the first 11 months. The growth outpaced the 12.9 percent for all of 2005.
Cosmetics sales jumped 21.8 percent in November year on year, accelerating from 21.2 percent a month earlier.
Sa Sa, facing higher cosmetics taxes on the mainland than it does in its home market, said it is working with dealers to slash retail prices.
Sa Sa, known for its competitive prices, reported that second- and third-quarter sales climbed 14.6 percent year on year to HK$1.34 billion (172.4 million dollars). Gross profit grew to HK$607 million, up 17.4 percent from a year earlier.