Last week, Gorenje and one of its Chinese business partners opened the first store in China to offer exclusively Gorenje appliances of the highest price range. The store is located in Wenzhou, a city with a population of seven million. Two additional stores are scheduled for opening soon.
Gorenje entered the Chinese market five years ago by establishing a representative office in Shanghai. Chinese consumers and customers are only offered high-end products such as Gorenje Pininfarina and Gorenje Ora-Ïto designer lines, refrigerator freezer Gorenje Made with CRYSTALLIZED™ Swarovski Elements, SmarTable with built-in refrigerator, new generation of cooking appliances, retro refrigerators, etc. From now on, all Gorenje products will be available at a single store, located in an upscale shopping centre in Wenzhou.
Due to its sheer size and uneven development, China is a very challenging market. Andy Miklav, head of Gorenje's representative office in China comments: "The market consists of provinces, developed coastal region, and multi-million cities; however, each market has its principles and requirements. The provinces and the coastal part are the largest market by value and volume and this is where the Chinese manufacturers are waging a relentless price war. The largest Chinese metropolises, i.e. the great eight, i.e. Shanghai, Beijing, Guangzhou, Shenzhen, Tianjin, Chongqing, Nanjing, and Dongguan, have a combined population of 140 million and this is the market we are aiming for in the long run. Our target group within these cities are the affluent classes that represent 20 to 30 percent of the total population."
Wenzhou is located in the South-eastern coast and was once a major trade port. Today, it is one of the motors of the rapidly growing Chinese economy, with highly developed textile, metal, plastics, and chemical processing industry. Owing to employment possibilities and the related standard of living, Wenzhou has recently attracted as many as three million economic immigrants from the less prosperous provinces to boost its population to 7.6 million. The citizens of Wenzhou enjoy a reputation of keen entrepreneurs as they develop their establishments both in their native city and abroad, e.g. in the USA and Europe where many emigrated to in the past to look for new opportunities.
In recent years, largest Chinese cities have seen incredible expansion in the real estate market and consumption. Andy Miklav: "At Gorenje, we are looking to seize both of these trends. Opening a store in the flourishing Wenzhou where the well-to-do citizens wish to furnish their homes in Western style is a solid starting point for further growth of sales."