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Today, the company has more than 110 wholly owned stores and counters selling more than 400 beauty brands (with 15,000 stockkeeping units) in Asia, including Hong Kong, Macau, Mainland China, Singapore, Malaysia and Taiwan. The firm's sales for the financial year ended March 31, 2007 were approximately $370 million, of which Sasa's brand management division operating in Asia as a sole agent for many international cosmetics names generated some 35 percent.
The company reportedly commands 30 percent of the Hong Kong cosmetics market, and it was considered to be the largest cosmetics specialty store in Asia, according to a recent industry ranking.
Meanwhile, Sasa has its sights set on additional expansion, including further into Mainland China, said Guy Look, Sasa's chief financial officer and executive director of Sasa International Holdings.
"It is a very interesting market and one with a lot of potential for us," he said. Already, Sasa has lots of experience with the Mainland Chinese consumers, since they ring up about 40 percent of the company's business in Hong Kong. "But China itself has its own challenges, which include product registration," he said. (Whereas in Hong Kong, it's not necessary to follow such formalities.)
"And for a multibrand retailer like ourselves, offering a broad product range, it's more challenging in that it takes a lot of time and effort to bring those products to the market and also in sourcing those products locally," explained Look.
Another hitch is that store productivity in China is not as high as it is in Hong Kong.
"The rental cost relative to sales is actually quite high," he continued. "So over the past couple of years, we have initially started with bigger store sizes and, as a result, we incur more rent. We have higher [capital expenditures] and, therefore, high depreciation. And we have to pay for more labor costs as a result of a bigger store size."