Hugo Boss Expands in China

By Linda Pasquini

(Reuters) – German fashion house Hugo Boss (ETR:BOSSn) announced plans to enhance its presence in China despite a decline in third-quarter sales due to weak demand in the region.

The company postponed its 2025 revenue and profit targets as its growth was affected by reduced sales in the Asia-Pacific area, linked to sluggish Chinese consumer demand.

Recent quarters have seen luxury groups facing challenges from tighter consumer spending, particularly in China, where issues such as a property slump and job insecurity have been significant.

Despite this, Hugo Boss is committed to expanding in China, which accounts for 5% of its total sales, differing from some competitors who are reducing prices and scaling back operations in a struggling market.

Focused Strategy
CFO Yves Mueller mentioned during an investor call that the company is concentrating on larger stores to improve customer experiences, a trend appreciated by Chinese consumers. The brand is also expanding its Boss Green line, which includes technical and outerwear items, aligning with the sports-oriented preferences of Chinese customers.

Additionally, Hugo Boss is investing in increasing its visibility on the social media platform TikTok. However, they remain cautious regarding the uncertain near-term consumer sentiment in the region.