- Facing a weaker Chinese market, Urban Revivo plans to expand to the West.
- Urban Revivo’s physical stores could help it penetrate the US market, where it sells online.
- Other fast fashion peers have found success in the UK and US markets.
A Chinese fast-fashion company is planning a rapid global expansion, just as industry players are slowing their growth to focus on online shopping.
Zara has been trimming its footprint post-pandemic, with plans to cut as many as 1,200 stores and double its e-commerce efforts.
But China’s Urban Revivo, founded in 2006, is eyeing markets outside Asia. Parent company Fashion Momentum Group wants to open branches in cities such as London and New York, CEO Leo Li told Nikkei Asia.
FMG now has more than 400 Urban Revivo stores in mainland China and several in Southeast Asia. Its only foothold in the Western market is through online shopping.
Next year, FMG plans to launch 20 international Urban Revivo stores annually, a number that could increase to 50 per year in the long term, Li said.
He told Nikkei that he hopes to grow the company to a valuation of $13.8 billion — still well below rivals like Zara and H&M, whose parent companies have market capitalizations of about $155 billion and $23 billion, respectively. Zara has about 2,000 stores worldwide, while H&M has about 3,800.
FMG is also considering an initial public offering in Hong Kong, which could raise $100 million, Bloomberg reported last month.
FMG’s focus on Europe and the US comes as some of its industry peers excel in those markets. Japan’s Fast Retailing, parent company of brands including Uniqlo, reported strong sales in North America and Europe in the first half of 2024, while business in China declined.
Weakening Chinese consumer demand has also hurt sales of Urban Revivo, which relies more on physical stores than its increasingly digital rivals, Nikkei Asia reported.
FMG may fare slightly better in the US. The rapid adoption of Chinese brands like Shein and Temu suggests that US consumers are comfortable with foreign brands, Damien Yeo, an analyst at Fitch Solutions, told Business Insider. But FMG will face a fashion-saturated America, with competition from other domestic and foreign brands like Uniqlo.
U.S. shoppers are “increasingly price-sensitive,” Yeo said. “This means that fast fashion companies are expected to do well because consumers who lower their prices are often good news for them, as their products are primarily aimed at the mass market.”
Urban Revivo’s physical stores could reduce ethical and political concerns compared to online “ultra-discounters” like Shein and Temu, Yeo said.
London is not a new location for the brand, which opened its first UK store in 2018 — a store that has since closed. However, London could prove to be a tough place to sell its products. Yeo said that high inflation in the UK could pose a problem for Urban Revivo’s sales, as consumers cut back on unnecessary spending.
The company did not respond to a request for comment.
