Victoria’s Secret is partnering with Regina Miracle to solidify their foundation for operations in China, the lingerie company announced on Tuesday.
For 44 years, the Ohio-based clothing retailer has sold lingerie and beauty products via high-impact advertising and risque modelling choices. Founded in 1977, they peaked in 2020 at over a thousand stores in the U.S. and Canada. But sales in recent years have been declining, as consumer tastes switch to less aesthetic, more comfortable underwear. 250 stores closed during the pandemic and did not reopen.
Victoria’s Secret also owns 26 stores in China, and it has plans to expand.
To secure a local partner for that venture, Victoria’s Secret will be selling a 49 percent stake in their business in China, specifically, to Regina Miracle International Holdings Ltd. Regina Miracle is a China-based manufacturer which makes lingerie, clothing, footwear, and other consumer products. Victoria’s Secret has been working with them for more than 20 years, according to VS CEO Martin Waters.
“Together with Regina Miracle, we aim to grow the China business through joint investment in product development, distribution, and marketing,” Waters said in a news release. “We expect the partnership will positively impact the speed and agility of the business to benefit consumers and provide us with a platform for a strong future in this important market.”
According to an investor presentation, international sales account for about $1 billion in revenue for the VS brand, and China currently accounts for 17% of that, before any expansion.
VS used the same tactic to expand into the United Kingdom in 2020, selling a 51 percent stake in UK business to Next PLC.
The deal with Regina Miracle is pending regulatory approval by the Chinese government, but could be finalized before the end of the first fiscal quarter of 2022.
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