Fast Fade: Once-Hot Retailers Are Some Of The Biggest Losers On This Year's Forbes China Rich List

Even in China the internet is killing brick and mortar retail. Aivars Lode avantce

Fast Fade: Once-Hot Retailers Are Some Of The Biggest Losers On This Year's Forbes China Rich List

Some of the biggest drops in wealth this year involve retail fashion enterprises. Metersbonwe’s Zhou Chengjian, for instance, fell $1.1 billion, tumbling to No. 84 at $1.54 billion, from No. 19 a year ago.

At least Zhou’s still in the top 100. Two others from the industry dropped off FORBES ASIA’s roster. What happened to these erstwhile entrepreneurial stars of China’s consumption boom? Weaker retail spending. Brutal competition from a slew of e-tailer sites like No. 8 Jack Ma’sTaobao and No. 99 Liu Qiangdong’s JD.com. Or overexpansion, sometimes with overly encouraging mall partners. Metersbonwe, facing inventory issues, shut 142 stores in the first half of this year.

Who’s doing better? The only fashion czar to see his fortune rise this year is Qiu Guanghe, chairman of Zhejiang Semir Garment. Semir has more than 1,200 stores and aims its flagship Semir brand at 16-to-30-year-old buyers of casual wear; its Balabala brand flogs midrange children’s clothing.

First-half 2013 sales increased 8% to $445 million, That in turn helped net profit to rise by 14% to $46.4 million, solidifying Qiu’s position in the upper half of our 100. (He shot onto the ranks two years ago at a post-IPO high that remains deflated.)

Semir Garment’s strategy is clear: find additional brands. In June it said it would pay up to $369 million for 71% of Ningbo Zhongzhe Mushang, which specializes in mid-to upper-end men’s leisurewear. In August it signed a deal with Minconf SPA under which Semir will license and sell two of the Italian company’s two high-end children’s wear brands in China. And in September came word of a joint venture with South Korean women’s wear firm Sisun International to open 500 of the Michaa brand stores in China over five years.

Are new names the answer to consumer indifference? Maybe–especially if the central government’s promises of easier urbanization and more social spending to boost mass buying power succeed. Surely more city dwellers will ensure a bigger potential clothing market of all ages, sizes and sexes. Operators like Qiu Guanghe want more chances to get in front of it.