Direction of luxury fashion retailers' post-entry expansion – the evidence from China

Huifeng Bai*, Julie McColl, Christopher Moore, Weijing He, Jin Shi

*Corresponding author for this work

    Research output: Contribution to journalArticlepeer-review

    4 Citations (Scopus)

    Abstract

    Purpose: This empirical study, from the international retailing perspective, examines the direction of retailers' further expansion after initial entry into overseas host market in the context of the luxury fashion retail market in China. 

    Design/methodology/approach: The research adopts qualitative multiple case studies.

    Findings: After initial entry into China, luxury fashion retailers further expand their retail operations through three directional patterns: cautious, regional and countrywide expansions. The stepwise expansion from tier-1 to tier-2 and tier-3 cities remains popular; however, the importance of the tier system of Chinese cities has been weakened because tier-3 cities in affluent regions are perceived to have more potential than some tier-2 cities in less developed regions. The retailers assess a potential local market through interrelated criteria, including location and strategic importance, economic development, available store locations and staff, a high degree of urbanisation and tourism, debatable favourable policies and offers, and popularity of e- and m-commerce. There is a positive relationship between popularity of e- and m-commerce in a city and the potential of that city to run brick-and-mortar stores.

    Originality/value: The paper offers an insight into the current international retailing literature by examining the direction of luxury fashion retailers' further expansion after their initial market entry. Particularly, the research considers a set of criteria which can be used to assess a potential local market, and the impact of e- and m-commerce on local market choices for brick-and-mortar stores.

    Original languageEnglish
    Pages (from-to)223-241
    Number of pages19
    JournalInternational Journal of Retail and Distribution Management
    Volume49
    Issue number2
    Early online date20 Nov 2020
    DOIs
    Publication statusPublished - 26 Jan 2021

    Keywords

    • Direction
    • Luxury fashion
    • Market development
    • Omni-channel retail
    • Post-entry expansion
    • Retailer internationalisation

    ASJC Scopus subject areas

    • Business and International Management
    • Marketing

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