Hengdeli: The Art of Co-existence

Abstract

In October 2011, Zhang Yuping, founder and chairman of Hengdeli, the largest Swiss watch retailer in the world, wondered how to work more closely with its key suppliers-Swatch Group, Richemont Group, LVMH Group, and Rolex Group-to maintain strong growth in the Greater China region. Specifically, how could Hengdeli manage the relationship with these suppliers to ensure getting more supply in a market where demand outgrew supply? How could Hengdeli balance the needs of these competing suppliers without being overreliant on one or two suppliers? How could it continue to expand its retail network to enhance its value and position? How could Hengdeli rationalize the portfolio management to maximize the return in the long-term?

Learning Objective: (1) Retailer-Supplier relationship management; (2) Avoiding channel conflict; (3) Retailing in China