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How is the company performing here?
Michael Casey knows all about brands that are timeless. After all, he works for one.
The chairman and CEO of Carter’s Inc reflected on the iconic children- and babywear labels, and stressed it was all about softness.
“Our clothes wash well year after year after year,” Casey said during a trip to Beijing. “We’ve had letters, saying how sweaters have been handed down from generation to generation.
“We had one, saying a pink sweater had been worn by grandmother, mother, daughter and grandchild when they were toddlers. It had been handed down for 40 years,” he added.
Tradition is everything for Casey, who popped over to the Chinese capital to visit a newly opened store.
It was a long way to come from the company’s headquarters in the United States city of Atlanta in Georgia. But then, Carter’s has been doing business in China for more than 20 years.
“A good portion of our products are sourced here, particular baby apparel, which is manufactured in China,” Casey said.
Founded in 1865, Carter’s has become a truly international business. In the US, the company has more than 18,000 retail locations, including 1,000 directly owned stores.
Overseas, it has 800 retail shops in 60 international markets. In China, it has nine stores and plans to open more than 40 in the near future.
Indeed, expansion has paid off for the children’s clothing company.
Data released by Carter’s showed first quarter net sales were $733 million, a 1 percent increase compared to the same period last year, according to the group’s corporate website.
“As for China, we have been happy with our performance,” Casey said.
In a far-reaching interview with China Daily, he talked about the company’s online strategy here, choosing the right locations and the OshKosh B’Gosh brand.
What is Carter’s presence in China?
We have a history of doing business here, mostly from our US website, which was launched in 2010. We saw strong demand after launching on Tmall (the online shopping center owned by Alibaba Group Holding Ltd) in 2015, and it has been very successful. Now, we’re starting to open up stores in the country.
Well, its early days, but we are very happy with the performance. Last year was our first full 12 months on Tmall with the Carter’s brand. We recently received a special recognition award by Tmall for being one of the most popular labels in children’s apparel.
We have also opened a new chapter with Pou Sheng International (Holdings) Ltd, our strategic partner. We opened nine Carter’s stores in the fourth quarter of 2016 and our plan is to have at least 40 more in the future.
2008 onwards: Chief executive officer, Carter’s Inc
2003: Executive vicepresident and chief financial officer, Carter’s
1993: Joined Carter’s as vice-president of Finance
1982-93: Price Waterhouse LLP, a predecessor to PwC
Since you are planning to open more outlets here, what does the future hold for Carter’s in China?
We believe this will be at least a $100 million opportu- nity during the next five years. We’re not trying to go fast, we’re trying to do it well and make sure we understand what is important to our Chinese customers.
There is no shortage of examples of companies that rushed into China and failed.
Many were very large, successful companies. We have done our homework, we have found good partners with Alibaba and Pao Sheng. We will look to them for guidance when it comes to Chinese consumers.
So, China could be the largest market for you outside of the United States?
Well, outside of North America. We have a very successful business in Canada. The two largest markets of growth for Carter’s during the next five years are Canada and China.
How do you choose locations here?
Right now, the focus is on first-tier and second-tier cit-
In China, the children’s apparel market is highly fragmented. Balabala is the largest with 3 percent of the market share. But to be fair, the brand is not a baby and toddler apparel label as it’s geared toward older children.
What we saw in terms of demand from here, or on our US website, is that China is the No 1 market outside of the United States. We were able to see what consumers were responding to and their favorite was baby apparel. So, we try to understand where the market is and adapt to that.
You have multiple brands under the Carter’s Inc umbrella. Will you bring over more labels to China?
Yes, I hope so. OshKosh B’Gosh is our other major label, which has been around for nearly 125 years, and focuses on the toddler segment. Carter’s is in baby apparel, so it’s nice to have these two com-
The key was finding the right locations for our stores here. You need to have the right retail center — the right space. Those are the two most challenging things and the most important.
Carter’s has acquired Skip Hop, a broad brand which sells strollers to bath toys. How will you sell the label here?
We are already doing business on Tmall. Our next focus is how we could create “an experience” within the store for customers.
We are working with our Skip Hop partners to decide how we relate that special experience with the brand.
Michael Casey, chairman and CEO of Carter’s Inc.