Athleisure, government-backed fitness boom propel sportswear brands in China

Growing acceptance of athletic wear in leisure and work settings, together with the government's push for a healthier lifestyle, bolsters sales of sports apparel.

April 06, 2017

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Growing acceptance of athletic wear in leisure and work settings, together with the government's push for a healthier lifestyle, bolsters sales of sports apparel.

The rise of the athleisure trend, coupled with a government-backed exercise boom, is spurring the growth of local and global sportswear brands in China.

Industry giant adidas, for instance, revealed that sales in the Greater China region increased 28 percent last year, the fastest of any market and adding to its net global profit growth of more than 60 percent. Rival Nike, meanwhile, said it posted double-digit ascent in revenue in China in the most-recent quarter. The country is the second-largest market for both brands, together accounting for about a third of China's overall sportswear sales.

According to analysts, revenue growth from global brands comes at the heels of rising incomes of China consumers. Priced higher than local brands, it also helped that most buyers view products from these international companies more as fashion labels than sportswear. Growing acceptance of athletic wear in leisure and work settings is fueling further the upward trend.

Sportswear sales in China rose 11 percent last year to $27 billion while overall revenue from apparel climbed 5 percent, data from market intelligence firm Euromonitor revealed.

Statistics from the China Business Research Academy also found out that gym membership in the country has doubled from 2008 to 6.6 million last year while yoga practitioners are estimated to have jumped from 4 million in 2009 to 10 million at present. Additionally, there are more than 100 marathons held nationwide last year compared with 51 in 2014.

The government's push for healthier lifestyle through exercise has boosted the sector. Facing what it believes is an epidemic of obesity-related diabetes and other lifestyle-associated illnesses, the China administration has pledged to increase the number of football pitches in the country from 50,000 to 70,000 by 2020.

But experts say that this fitness phenomenon benefits mid-market local brands more than high-end labels as consumers favor value and functionality over fashion statement when exercising.

China brand Anta revealed in February that its 2016 net profit increased 17 percent YoY, a record high of $374 million. Operating profit margins for the year stands at 24 percent, compared withabout 14 and 8 percent for Nike and adidas, respectively. Anta's sponsoring of the 2016 China Olympic Team has also boosted its public presence. The company holds local distribution rights to Italy sportswear brand Fila as well, helping bolster its revenue.

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