Tuesday , June 15 2021

The Chinese group Ruyi is looking for new acquisitions to face the LVMH



Chinese clothing group Shangdong Ruyi aims to buy new luxury brands, niche in full swing, in order to create the first high-end Chinese empire to deal with LVMH. In Europe, Ruyi already controls the French SMCP group, the owner of Sandro, Maje and Claudie Pierlot, the British brands Gieves & Hawkes and Aquascutum and the Swiss manufacturer Bally.

Qiu Yafu, president of Shandong Ruyi. Photo taken on November 12, 2018 – REUTERS / Bobby Yip

His president, Qiu Yafu, a little known and discreet billionaire even in China, told Reuters Monday that he expects an increase in affordable luxury, even in the context of a wider economic crisis.

Qiu Yafu, who started his career at the age of 17 as an apprentice in one of Ruyi's textile factories, has great ambitions in the fashion world. His group leads the sector in China in the division of high-end fashion houses traditionally dominated by Europe. The businessman, born in 1958, does not hide that he wants to become as big as LVMH by seeking affordable luxury, although he admits that rivalry with number one in the world of luxury is not something that will happen overnight. .

"LVMH is a world-famous company that is like a god in its field, this is our model, we are still far away, but this is our project," he told Reuters in an interview in Hong Kong, a conference in the luxury industry.

"It will be five years, ten years or even more, will it be for the next generation or better team?" This is a very important project and challenge, it may not even be possible, but that does not mean that we should not learn, imitate or borrow ideas. "

Solid growth and high prices

Qiu Yafu added that Ruyi will be "looking for" high-quality "avant-garde" brands that offer perspectives for sustainable development.

"Ruyi has specific and specific requirements and strategic positioning for fashion brands, we constantly research and monitor brands that reflect high positioning quality, solid growth and high prices," he said.

According to Euromonitor, the fashion market in China will reach 2,200 million yuan (around USD 314 401 million) by 2022, an increase of around 10% compared to the current volume. But this huge market slows down, and Qiu Yafu wants to use digitization and e-commerce to develop the customer base.

The desire to take over Ruyi, a privatized company about 20 years ago, began in 2010 as part of a vertical integration strategy and increase in coverage that accompanied the rapid rise of the upper middle class in China.

The group, which bought Invista and its Lycra brand last year, is present in 84 countries, and its annual turnover, according to Qiu Yafu, exceeds 20 billion yuan (about 2863 million dollars).

Ruyi is just one of the big Chinese groups that is trying to get European fashion brands. The Fosun Conglomerate took control of the Lanvinis at the beginning of the year, and Carven recently passed into the hands of the Icicle Fashion Group.

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