Chinese H&M, Zara challengers rise

What happened Tenera, a fast-growing handbag brand from Shanghai, has recently landed in Seoul’s ultra-hip Seongsu neighborhood, close to fashion heavyweights including Dior’s flagship and Gentle Monster’s global headquarters. Since its founding in 2023, the trendy yet affordable brand, has gone viral online with its distinctive plastic bag-inspired Hobo tote. The hashtag #Tenera has amassed 5.4 million views on China’s lifestyle platform Xiaohongshu (RedNote), making it one of the most talked-about emerging Chinese handbag brands. Now, it’s rapidly expanding its brick-and-mortar presence in top shopping destinations. Chinese fashion labels expand global presence despite tariffs This is the latest in a succession of moves by China’s homegrown brands to go global through brick-and-mortar stores. By end-February, Urban Revivo (UR), opened its first U.S. flagship in one of SoHo’s iconic cast iron buildings in New York City. The 3,000-sqm space in the midst of Zara, Alo, and Lululemon marks the acceleration of its overseas expansion, with openings planned in the U.K. and Japan this year. More significantly, UR has already surpassed Zara and H&M in China, reinforcing its dominance in the domestic market as it looks to compete on a global scale. Also joining the international retail wave are luxury handbag brand Songmont and fast fashion retailer Semir. Songmont, a Beijing-based accessible luxury handbag label, became the first Chinese handbag brand to showcase at Paris Fashion Week in Fall 2024. Meanwhile, Semir and its subsidiary Balabala reported staggering 40% year-over-year sales growth in overseas markets during the first two months of 2025. The Jing Take This surge in Chinese brands expanding overseas through brick-and-mortar retail comes at a time of increased U.S. tariffs on Chinese imports and heightened geopolitical uncertainties. The Trump administration has imposed an additional 10% tariff on China-made fashion items, on top of the existing 25% tariff from his first term. This move puts pressure on American consumers, among the world’s biggest fashion spenders, while complicating global strategies for Chinese brands looking to establish a U.S. presence. Additionally, the looming threat to revoke the de minimis exemption—which allows imports valued under $800 to enter the U.S. duty-free — has left online fast fashion giants like Shein and Temu scrambling to adjust. China’s fast fashion vs. global giants: Can UR compete with Zara? Diversifying its global sourcing strategy is one way UR is addressing potential tariff risks. According to founder Leo Li, UR plans to shift production for its European market to Turkey while also localizing manufacturing in the U.S. to mitigate supply chain disruptions. For Chinese fashion brands, investing in physical retail and securing local production facilities could become essential survival strategies amid rising trade tensions. UR, founded in 2006 — the same year Zara opened its first China store —currently operates over 400 locations, including 20 overseas, with annual sales nearing $1 billion. However, competing with Zara, which has 1,811 stores worldwide and reported $30 billion in sales last year, remains an uphill battle. The future of Chinese fashion: Expansion, innovation, or localization? The challenge for UR is differentiation in a saturated market. The brand’s fast fashion rivals release hundreds of new styles weekly, making most collections highly similar. Even in UR’s sleek SoHo flagship store, the only design cue signaling its Chinese heritage is a purple clay pottery-colored wall inspired by Chinese tea culture. Forever 21, once a fast-fashion pioneer, filed for bankruptcy on Monday this week, the second time within six years. Gap sold its China business to Baozun, a local e-commerce service provider, in 2023, after closing 86 stores. For brands like UR and Songmont, the lack of original and iconic design could be a significant weakness, making it difficult to establish a lasting presence in international markets. For instance, Songmont handbags resemble Polène’s mid-luxury aesthetic but are priced at half the cost, while Tenera’s bestsellers (all products under $100) continue to revolve around the same recycled polyester Hobo tote. Without strong product innovation, maintaining long-term consumer interest will be a challenge. “While younger consumers are more open to trying new brands, they are also far less likely to develop strong brand loyalty,” Cheng Weixiong, a fashion industry analyst, commented in an interview with Jiemian, a Chinese business and financial news outlet. At the same time, former fast fashion shoppers are becoming increasingly eco-conscious and inflation-weary. Many now prefer investing in unique secondhand pieces over mass-produced garments at the same price point. This shift is fueling exponential growth in the resale market. According to Statista, the fast fashion market in the U.S. is expected to grow 20% by 2029, while the secondhand apparel market is forecast to expand by a staggering 185% in the same period. If Chinese fashion brands want to succeed globally, they must balance affordability with originality, embrace sustainable practices, and differentiate themselves beyond price competitiveness. The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.

Chinese H&M, Zara challengers rise

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Published March 19, 2025

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Chinese H&M, Zara challengers rise