Online clothing retailer Vancl had topped Deloitte’s ranking of the 500 fastest-growing technology companies in Asia. Vancl announced its plans to expand into Hong Kong soon to extend the reach of its Web apparel business, which had demonstrated impressive growth over the last 3 years. The privately held firm founded in October 2007 runs the internet shopping portal Vancl.com, which directly markets and sells to mainland consumers its own brand of garments for men, women and children, in addition to shoes, accessories and home furnishings.
Jolyon Barker, the group managing partner at Deloitte’s technology, media and telecommunications practice, credited Vancl for an estimated 29,576 percent revenue growth rate over the past three years, enough to easily seize the #1 spot in the fast-500 list this year. Online market analyst firm iResearch estimated Vancl had a dominant 28.4 percent of the mainland’s business-to-consumer online garment retailing market in the first half.
Vancl, which has more than 800 workers, says it sells about 50,000 pieces of garments a day. William Chou, the lead executive at Deloitte China’s technology, media and telecommunications group, attributed Vancl’s rapid growth to the growing fondness of mainland consumers for shopping online, the firm’s focus on selling strictly apparel, its wide distribution and customer service. Other mainland online vendors offer a broad portfolio of products and often lack customer support. Vancl’s lifestyle-brand approach to selling a specific collection of attractive and low-cost merchandise on the internet also combined what appears to be retailing lessons learned from Britain’s Marks & Spencer, Amazon.com in the United States and CEO Chen’s own e-commerce experience on the mainland.
Chen was the founder and executive vice-president of Beijing-based online bookstore service Joyo.com, which was acquired in 2004 by Amazon for US$75 million and transformed into its regional website. “We’ve only touched the tip of the iceberg, with a customer base of two million to three million buyers out of 300 million internet users in China,” said Chen. “We expect further growth as we focus on innovation and improving customer experience.”
Vancl expects its annual revenue to rise about 100 per cent this year from 300 million yuan (HK$340.59 million) last year. Sales in its first year reached only 1.12 million yuan.
The mainland’s business-to-consumer online apparel shopping market is forecast to record revenue of 2.4 billion yuan this year and 18 billion yuan in 2012, according to iResearch. Barker said Vancl’s stellar performance in the past three years had clearly skewed the average revenue growth rate in the Deloitte fast-500 list’s top five, which collectively posted 8,980 per cent in average revenue growth over the past three years.
Source: HKCHCC
