Net-a-porter leaves the Chinese market – TheIndustry.fashion

A China-based joint venture between Alibaba and Yoox Net-a-porter (YNAP), Fengmao, will be laid off, according to its CEO Yating Wu.

YNAP operated in China in a joint venture with Alibaba, but the report now states that it “will be liquidated.” According to WWD, Fengmao’s dissolution is part of YNAP’s strategy to exit China and focus on more profitable geographies.

Reports indicate that it is a luxury giant Richemont, which owns YNAP, intends to sell its unprofitable operations this year. Thanks to this move, it will be possible to organize the company before the sale.

Richemont revealed that sales at YNAP fell 14% in fiscal 2024 “in a challenging environment for luxury e-commerce.”

Net-a-porter entered the Chinese market in 2013. Later that year, its discounted sister company The Outnet exited the Chinese market due to fierce competition.

In 2018, Richemont signed a joint venture with Alibaba Group to capture more of the Chinese e-commerce market. The following year, Net-a-porter opened a flagship brick-and-mortar store in Luxury Pavilion on Tmall. However, by 2020, the retailer shut down its Chinese website.

Ultimately, rival JD.com’s offering of omnichannel solutions for third-party luxury brands led to the end of Alibaba’s reign over luxury e-commerce in China in 2020, and the company has been hurting ever since.