Sa Sa China Analysis
Introducing the Sa Sa International Holding Limited (China)
Sa Sa International Holding Limited, a Hong Kong leading cosmetics retailing group in Asia. Sa Sa has approximately 220 stores and retail counters across different regions in Asia. Together with it owns brand and other international brands; Sa Sa offered over 600 brands of skin care, and fragrance, make-up and hair care products. In 2005, in order to track the fast growing trend of China Cosmetic industry, Sa Sa International Holding Limited decided to enter China market with 2 new retail store opens in Shanghai. Up to now, Sa Sa China has launched 69 retail location across different areas in China. Market prospect: Chinese customers still prefers to purchase their cosmetic products in department store. This should be a major challenge for most of the Beauty specialist retailers.
Current situation
According to the interim financial report on 30th of September 2011, it has shown that Sa Sa is performing well in its core market “Hong Kong and Macau” area; however, Sa Sa has experienced a loss of HKD 19.75 million in 2011. The management team of SaSa claims that the recorded loss in 2011 is caused by expense increases in recruiting new staff members, logistics and new store establishment. Including the record of losses in 2011, Sa Sa China has experienced losses for 6 consecutive years. Exploratory research is conducted to understand the underlying problems of Sa Sa China - “Asia Pacific Equity Research by Elsa Yang from JP Morgan , and莎莎大陆遇阻：四大原因导致内地业务发展缓慢 by李欣 from华夏经纬网 . The poor performance of Sa Sa China is believed to be caused by several factors. Firstly, High import tax in China has been affecting the low price strategy that Sa Sa has well-practiced on. Secondly, the competitive cosmetic market in China has weakened the Sa Sa’s high products varieties strategy. Thirdly, the selling strategy of Sa Sa is lacking of supports from most of the major labeled brands. These problems might able to
Sa Sa International Holding Limited, a Hong Kong leading cosmetics retailing group in Asia. Sa Sa has approximately 220 stores and retail counters across different regions in Asia. Together with it owns brand and other international brands; Sa Sa offered over 600 brands of skin care, and fragrance, make-up and hair care products. In 2005, in order to track the fast growing trend of China Cosmetic industry, Sa Sa International Holding Limited decided to enter China market with 2 new retail store opens in Shanghai. Up to now, Sa Sa China has launched 69 retail location across different areas in China. Market prospect: Chinese customers still prefers to purchase their cosmetic products in department store. This should be a major challenge for most of the Beauty specialist retailers.
Current situation
According to the interim financial report on 30th of September 2011, it has shown that Sa Sa is performing well in its core market “Hong Kong and Macau” area; however, Sa Sa has experienced a loss of HKD 19.75 million in 2011. The management team of SaSa claims that the recorded loss in 2011 is caused by expense increases in recruiting new staff members, logistics and new store establishment. Including the record of losses in 2011, Sa Sa China has experienced losses for 6 consecutive years. Exploratory research is conducted to understand the underlying problems of Sa Sa China - “Asia Pacific Equity Research by Elsa Yang from JP Morgan , and莎莎大陆遇阻：四大原因导致内地业务发展缓慢 by李欣 from华夏经纬网 . The poor performance of Sa Sa China is believed to be caused by several factors. Firstly, High import tax in China has been affecting the low price strategy that Sa Sa has well-practiced on. Secondly, the competitive cosmetic market in China has weakened the Sa Sa’s high products varieties strategy. Thirdly, the selling strategy of Sa Sa is lacking of supports from most of the major labeled brands. These problems might able to