Vans, North Face detail ambitious plans for Asia Pacific

VF Corp. detailed its five-year Asia Pacific growth plan for analysts today in Shanghai, including its big plans in the region for Vans and The North Face.

 

VF’s overall goal is to add $1.1 billion in revenue in the region over the next five years. That would bring total revenue in the region to $2 billion in 2017.

 

In 2012, VF expects to generate $900 million in this territory.

 

The company plans to mostly focus on its five biggest brands – Timberland, Lee, North Face, Vans and Kipling.

 

Vans

Over this five-year period, Vans is expected to add $200 million in revenue in Asia Pacific and grow 22% annually.

 

Currently, Vans generates $115 million in revenue in this territory. The goal is to reach $315 million in 2017. China will account for 51% of the growth.

 

A Vans advertisement in China. Image courtesy of VF Corp.

Vans operates 500 stores in this region today and expects to grow to 1,500 stores in five years.

 

It’s consumer studies have shown there is a tension with Chinese youth between fitting in and standing out. Action sports are aspirational but not fully understood.

 

Vans is focusing on music and skate in China, and making product specifically for this market. For example, it has a T-shirt program that uses Chinese artists, brighter colors and Asian fits.

 

VF recently opened a subsidiary in Korea, and Vans was the first brand to launch there.

 

The North Face

The North Face is expected to add $340 million in additional revenue in the next five years and grow at a 26% annual rate.

 

Examples of North Face ads in China

In Asia Pacific, North Face revenue currently totals $160 million. That is expected to grow to $500 million in 2017. China will account for 95% of that growth.

 

The North Face currently operates 600 stores in the region, and that should grow to 1,700 doors by 2017.

 

 

 

 

 

 

 

See Page 2 for details about Timberland, VF Corp. overall

 

 

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Timberland

Timberland, which VF acquired in 2011, is the company’s largest brand in this territory.

 

VF expects Timberland to add $230 million in Asia Pacific over the next five years, and to grow 13% annually.

 

Currently, Timberland generates $270 million in revenue in this region. That is expected to grow to $500 million in 2017.

 

China will account for 60% of that growth.

 

Timberland now operates 180 doors in the region, and that should increase to 700 doors by 2017.

 

 

VF – China

VF has invested heavily in consumer research and believes it has good insight into the consumer in China.

 

Currently, China accounts for half of the region’s revenue. By 2017, VF expects that figure to grow to 60%.

 

Annually, VF predicts China revenue will grow 21%.

 

In China, VF will focus on four key areas: outdoor, youth culture, jeanswear and casual bags.

 

VF – China retail

Currently, VF has 2,300 stores in China. That number will grow to 6,000 by 2017.

 

VF – India

The company predicts revenue in India to increase 22% annually and to grow from 8% of total Asia Pacific revenue now to 10% in 2017.

 

VF – Japan, Korea

Japan is expected to grow 8% annually.

 

VF recently opened a new subsidiary in Korea. Korea sales are expected to grow 52% annually.