The New Silk Road : Swedish Apparel Companies’ Challenges in China’s Market

Background and problem: As one of the major emerging markets, China has alarge population, stable growth in GDP and increased consumer spending powerwhich has attracted the whole world’s retail business. Many international clothingbrands have increased investment or speeded up the pace into the China’s market (Chen et al., 2007; Cui 2000).However, because of the differences in economy, policy and culture, it sometimesresults in difficulties in meeting standards and accessing the market with effectivestrategies (Cui, 2000). Numbers of clothing brands have been found not reach theChinese standards of textile and apparel. These problems force the brandswithdraw their substandard products from shelves, pay fines, and exposed by themedia, therefore the brands suffer not only economic losses, but also the damageof their images and reputations.The identified problem corresponds to two research questions:• What are the main challenges for apparel companies to conform withChinese standards?• How have the Swedish textiles retail companies responded to thesestandards?Methodology: A qualitative research approach was taken to collect relevant data.In the first phase, literature review was used to collect information related topicsof the thesis. Because this paper was addressed on China’s market as the focus ofthe investigation, both China’s and Swedish academic databases were utilized. Inthe second phase, the author developed the work by doing an interview withKlaus Ziegler, the founder and owner of the Quality Partnership LLC in China; anin-depth international laboratory located in China identified the impact of theChina’s standards and regulations and two email interviews with the managers oftwo Swedish apparel retail companies. Moreover, few informal interviews withprofessors in the Swedish School of Textiles and experts from Business Swedenwere made to reach better understanding of thesis topic.Conclusions: Findings provide insight on Chinese highly growing standardsregarding quality and service; International exporters face a lack of understandingof these standards in China’s textile market; The research of two retail companiesindicate that the companies can conduct better conformity of Chinese standards bysetting specific requirements to control the production, paying attention tolabeling related rules, cooperating with developed export agents, professionalthird-party laboratory, and so on