Macy’s branches into China with online deal
Macy’s Inc. is pairing up with Omei.com, a new Chinese e-commerce site, to sell some of its private brand items to consumers in the growing Asian market.
The department store chain, which also owns Bloomingdale’s, invested $15 million in Omei’s parent VIPStore Co. Macy’s will get its own section on the Omei website, where product orders will be filled locally in Chinese facilities.
Macy’s will start selling women’s and men’s fashions from its I.N.C. label on Omei starting in spring 2013. Other private brands will gradually become available.
International tourism and broadcasts of its Thanksgiving Day parade have already made Macy’s a popular name in China, said Chief Executive Terry J. Lundgren.
“But we still have a great deal to learn about the shopping patterns and merchandise preferences of consumers in China’s very diverse and rapidly emerging consumer marketplace,” he said in a statement.
Online retail spending in China is expected to triple in the next three years, reaching $360 billion in 2015, the Boston Consulting Group said last month. American companies such as Forever 21 are angling to enter the emerging market there.
Macy’s first began selling its goods online in China last year. Omei users will be able to link to merchandise sold on Macys.com, where orders will be filled in the U.S. and shipped to China.
The company reported a 38% increase in its first quarter profit earlier this month, in large part because it has tried to adapt its inventory to local markets. Net income rose to $181 million, or 43 cents per share, from $131 million, or 30 cents per share, during the same quarter a year earlier.
Revenue was up 4.3% to $6.14 billion.
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