market chain Dia has conceded that its Chinese expansion plans have not gone to plan. The group today confirmed that it has decided to withdraw from the Chinese capital Beijing, to focus its efforts on Shanghai.163 Dia stores in Beijing are to close, with media repots saying that closures actually began happening as early as Spring 2013.
The reasons stated by the company for why this has occurred are two fold: poor performance of sales and rising rents as the result of the housing bubble in Beijing.
In comparison, Shanghai has been a more profitable investment for the Spanish retailer. DIA has grown to 163 stores in the Chinese capital, but only generated gross sales of €60 million, according The Confidential.
In 2003 the group announced its arrival in China , with the opening of more than 300 stores across the country. Growth was slower than expected and at the end of 2011 it had achieved 447 outlets at its peak.
DIA says it intends to continue in China and they will not leave the country market. According to the results of the third quarter of 2013, sales in China represent a 1.7% of the total business of the group, reaching €150 million.
