From the launch of its first store in Melbourne in 2005, to being acquired by the prestigious luxury arm of LVMH Moet Hennessy Louis Vuitton; Melbourne athletic-wear start-up 2XU is geared up for ramping up its growth in China.
The new deal between 2XU and GXG will make its compression merchandise and apparel available to Chinese consumers – fueled by China’s unprecedented growth in the gym and fitness industry, which has increased at an annualized rate of 11.8 percent since 2011 and generated close to $6 billion in revenue last year alone.
The Australian-based sportswear label says it plans to open up to 50 retail stores throughout mainland China in the next three years, in addition to its online and wholesale presence. Additional apparel lines will also be designed by 2XU exclusively for the China market to facilitate its growth there.
2XU’s chief executive Paul Higgins says the joint venture with GXG represents a significant move for the Melbourne-based business. “Today marks the start of another exciting chapter for 2XU. The company was started in Melbourne just 12 years ago and to now be partnering with one of the world’s biggest fashion retailers to formally launch 2XU China is a real milestone.”
2XU first entered Asia in 2008 with a wholesale presence in Hong Kong and Singapore, and is now present in 13 markets across the Asia Pacific region with plans to grow its retail presence from 22 to 50 stores in the next 12 months and to 100 in the next three years.
“The joint venture is an exciting opportunity for 2XU to share the world’s best sports compression and high-performance apparel with Chinese consumers, who are embracing sport and physical activity like never before.”
Growth in the local sportswear market has been driven by an upswing in sports participation rates in China. In 2016 some 2.8 million runners participated in organized running events according to the Chinese Athletic Association, more than twice the number in 2015. But, it’s the Western concept of gym-based training that has seen the biggest increase, with the total number of gym attendees across 70 major Chinese cities increasing by four to five million every year since 2011, according to a 2016 report from IBISWorld.
For Australian-based 2XU, with a strong heritage in running and a rapidly-expanding presence in the high intensity training market, the move into China comes at the right time.
Analysts predict that newly active Chinese consumers will drive the market volume of sportswear in China to $41 billion by 2020.
The projected growth is mirrored by 2XU’s already-strong results in the Asian region, generating 51 percent year-on-year growth in the past 12 months.
The agreement with GXG, one of China’s leading retail businesses with more than 2000 stores in market, will see dedicated 2XU Performance Centres open in major Chinese cities from early next year.
2XU’s China general manager, Vivian Li says the Chinese sportswear market presents significant development opportunities. “We are delighted to officially launch 2XU China and look forward to introducing the brand to Chinese consumers.”
“2XU’s world-leading innovation, product technology and strong global strategy provide a great platform for the brand in China and we look forward to a very successful future.”
Founded in Australia in 2005, 2XU is the global leader in sports compression and high performance apparel brand. 2XU has 26 retail and outlet stores in Australia and is present in over 70 overseas markets via 34 retail stores and more than 4,000 wholesale doors. The company employs more than 300 staff worldwide.
According to 2XU, the brand is the official compression partner of leading sports organizations including the Australian Institute of Sport and Australian Football League, and the compression brand of choice for some of the the world’s top athletes and sports teams including 29 out of 30 NBA teams, 80 percent of NFL teams and the US Navy SEALs.
Lifestyle influencers of the brand include including Kanye West, Pippa Middleton, Victoria Beckham and Sofia Vergara.