Retailing, Franchising, and Consumerism Business Intelligence in China

Hola Eyes 60 Retail Outlets On Chinese Mainland By 2014

During Hola's recent winter products launch, the Taiwanese home decoration retailer announced that it will start developing the Chinese mainland market via virtual channels, including TV, mail-order catalogs, and the Internet; and the company aims to have 60 stores in this marketplace by 2014.

Since its entry into the mainland market with its first store opened in Shanghai in 2004, Hola has developed 26 stores in seven cities on the Chinese mainland. Over the next few years, Hola's expansion of physical stores will take Shanghai, Beijing, and Shenzhen as its three centers for growth. Apart from the seven cities where Hola has already settled, it plans to soon explore three new markets: Tianjin, Guangzhou, and Nanjing. At present, Hola has ten stores in Shanghai, and it plans to open two new stores in the city at the end of 2010 and the first quarter of 2011, respectively.

For the virtual channels, Gu Yihua, general manager for Hola, said that the costs for rent and labor have been increasing year by year. Due to the limits of funds, services, and spaces, the growth of physical stores are also limited. However, once the virtual platforms are established, the potential for consumption will be unlimited.

Hola reportedly opened online sales channels in Taiwan in 2008. According to Gu's statements to local media, based on the company's experience in Taiwan, the online sales should be triple those of physical stores' sales. Though there may be conflict between the two channels, they can also promote each other to some extent. Gu hopes Hola's e-commerce sales will account for 30% of its total sales in the next three to five years.

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