The success of Stella Luna, the Chinese shoe manufacturing group’s first retail chain, has led to plans to introduce a new banner aimed at a different segment of the market, called What For. Priced at up to 1,500 remimbi (€145) per pair, What For’s offerings will be aimed at a younger, more contemporary segment of the market. Stella Luna had 41 stores in China and Thailand as of last June 30, selling shoes priced at 700-2,000 renminbi (€68-195 or $93-265) per pair, targeted at the middle class.
Stella’s total revenues increased by 18.5 percent to $417.3 million in the six months ended June 30, and they generated 20.9 percent higher net income of $50.2 million. Excluding one-time expenses of $2.2 million related to the company’s recent listing on the Hong Kong stock exchange, the bottom line would have increased by 26.6 percent.
Shipments rose by 10.7 percent to 22.2 million pairs, and average selling prices increased by 7.9 percent to $18.40 per pair. Of the total revenues, 59 percent came from women’s footwear (13.5 percent higher than the previous year), 40 percent from men’s footwear (+23.9 percent), and 1 percent from retailing (more than 12 times last year’s figure). More specifically, the breakdown was men’s casual 35.8 percent, women’s casual 33.4 percent, men’s fashion 20.8 percent, women’s fashion 4.3 percent, and women’s private label 4.3 percent. North America brought 57.8 percent of revenues, and 31.2 percent came from Europe.
The group’s four facilities in Guangdong operated at full capacity. The group had 25,306 employees, against 22,539 one year earlier. Economies of scale and efforts to control the cost of raw materials and manufacturing led to improved margins.