Despite this failure, Shanghai Tang products found numerous followers especially among Western tourists and became “souvenir-like” must-haves. However, despite its strong brand DNA, the brand did not generate enough repeated sales and over the years the company cumulated heavy debts and became unprofitable.
What happened to Shanghai Tang?
In July 2017, Swiss luxury group Richemont announced that it had sold Shanghai Tang to a group of investors headed by Italian entrepreneur Alessandro Bastagli. Bastagli bought the business believing there was potential in Shanghai Tang to grow and attract a younger generation of customers who wanted a Chinese brand.
Is Shanghai Tang still in business?
Shanghai Tang was bought by Lunar Capital in 2018 and now has seven stores across the world, including a three-floor flagship in Hong Kong. Combined with the spiralling retail rents in Hong Kong during the same period, the brand began losing money, ultimately leading to Richemont's decision to sell it.21 Aug 2019
Why did Shanghai Tang fail?
Shanghai Tang boutiques network Tang shut the store only two years after its grand opening because of the high lease and frustrating marketing projections.