FRANKFURT (Thomson Financial) - Arcandor AG. will decide this year whether to enter China's mail-order market, and may launch operations there as early as next year, mail-order operations Primondo head Marc Sommer told Die Welt in an interview.
'In China, we see good opportunities in the teleshopping market,' Sommer told the newspaper.
He said the company would likely concentrate on large cities such as Beijing and Shanghai.
'There is no doubt that we see bigger growth opportunities abroad than in Germany,' Sommer told Die Welt, saying the company plans to increase the proportion of sales posted abroad to 50 percent from 25 percent now.
The company is launching mail-order operations in Ukraine next year and is also mulling market entry in Turkey, Brazil and India.
Sommer also said the company expects its Russian mail-order operations to contribute as much as 900 million euros within three or four years.
'The Russian market for fashion and textiles, on which we are currently concentrating, will have a volume of up to 60 billion euros in three or four years,' Sommer told the newspaper.
'We think that we can win about 1.5 percent market share, conservatively estimated.'
Due to its size and underdeveloped infrastructure, Russia is 'perfect for mail-order', Sommer said, adding the company currently posts a return on sales of 8 percent there, about three times as much as retailers achieve on average in Germany.
But Sommer said he is optimistic that the universal mail-order market in Germany will recover, citing studies by Deutsche Bank and other researchers showing that mail-order will by 2015 account for 13 percent of total retail sales, up from 7 percent now.
The company may also consider selling pharmaceuticals through its Quelle catalogue to boost sales.
'As soon as the legal framework is created, we will examine a commitment in this area,' Sommer said.
'We see great potential in that market.' maria.sheahan@thomson.com mas/lam COPYRIGHT Copyright Thomson Financial News Limited 2008. All rights reserved. The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.