Giordano Growth Strategy

Giordano’s Growth Strategy

As early as the 1980s, Giordano realized that it was difficult to achieve substantial growth and economies

of scale if it operated only in Hong Kong. The key was in regional expansion. By 1999, Giordano had

opened 740 stores in 23 markets, out of which Giordano directly managed 317 stores. Until 2000, four

markets dominated its retail and distribution operations – Hong Kong, Taiwan, China, and Singapore. By

2000, Giordano had 895 Giordano stores in 25 markets.

Giordano cast its sights on markets beyond Asia, driven partially by its desire for growth and

partially to reduce its dependence on Asia in the wake of the 1998 economic meltdown. In Giordano’s

first full year of operation in Australia, sales turnover reached HK$29 million (US$3.72 million) in

December 2000. The number of retail outlets increased from 4 in 1999 to 14 in 2000. With the opening up

of its first retail outlet in Sydney in September 2000, Giordano outlets could now be found in both

Melbourne and Sydney. As part of Giordano’s globalization process, it planned to open up its first shops

in Germany and Japan during the first half of 2001. Currently, Giordano planned to focus its globalization

efforts on new markets like Germany, Japan, Australia, Indonesia, and Kuwait.

When the crisis made Giordano rethink its regional strategy, it was still determine to enter and

further penetrate new Asian markets. This determination led to the successful expansion of Giordano in

Mainland China, which saw the retail outlets grow from 253 stores in 1999 to 357 stores in 2000. Due to

the expanded retail network in Mainland China and improvements made to the product line, sales

turnover increased by 30.9 percent to HK$712 million (US$91.3 million) in 2000. Faced with the

imminent accession of Mainland China to the World Trade Organization, Giordano’s management

foresees both challenges and opportunities ahead. In Indonesia, Giordano opened up 7 more stores in

2000,...