CHINA FRANCHISE NEWS
Vol. 2 , No.11 - June 5, 2001
China Brand Owners Take Center Stage
at INTA Annual Meeting |
The 2001 Annual Meeting of the International Trademark Association was recently held in San Francisco from May 5-9. Lehman, Lee & Xu escorted a delegation of twenty Chinese brand owners and three representatives from the China Trademark Association to the INTA meeting. The companies, which included some of China's premier multinational corporations,were the first group of Chinese brand owners to join the association. Lehman, Lee & Xu, in association with the China Trademark Association and the Chinese brand owners, hosted on May 6 a Sunday brunch information session that attracted in excess of 1,200 guests. Lawyers from the firm were able to introduce guests to leading corporate figures in China and the China Trademark Association and to answer any questions concerning intellectual property protection in China. This year's INTA Annual Meeting was the largest in its 123-year history, with a reported attendance of around 7,300 participants. Many of the participants stopped by the exhibitor booth organized by Lehman, Lee & Xu, the China Trademark Association, and the Chinese brand owners. For more information, please send email to mail@chinalaw.cc. |
TOPICS THIS ISSUE:
- China Third Franchise Exhibition & Conference on June 14 ~ 16
- McDonald's Expanding Electronic Payments
- Ethan Allen, Markor Furniture to Develop Retail Stores in China
- Overseas Tour Firms Seeks Shares of Mainland Market
- Growing Demand for High Quality Leather Products
China Third Franchise Exhibition & Conference on June 14 ~ 16
China Chain Store & Franchise Association (CCFA) is a national, industrial non-profit organization registered with the Ministry of Civil Affairs since 1997. It is comprised of retail and franchise companies that operate throughout China. Under the direction of China's State Economic and Trade Commission (SETC), the CCFA assists the government in developing the retail and franchise industries.
The Third China Franchise Exhibition & Conference will be held by CCFA June 14-16, 2001 at the Beijing International Exhibition Centre. The exhibitors are foreign and domestic enterprises rendering diversified retail services, including franchise business.
The Franchise Conference includes the main conference and seminars on special topics.
Mr. William A. Wright, senior attorney and franchise expert of Lehman, Lee, & Xu, has been invited to speak at the main conference and the Seminar on Franchise Law. The arrangements are as follows:
Mr. William A. Wright's speech at the Main Conference
Topic: Important issues for Chinese investors buying a franchise of a foreign company
Time: June 14, 2001 (Thursday), 15:20 - 16:20
Venue: 2nd Hall of Beijing International Convention Centre
Mr. William A. Wright's speech on the Seminar on Franchise Law
Topic: How to draft a franchise agreement
Time: June 16, 2001 (Thursday), 8:30 - 10:30 am
Venue: 7th Hall of Beijing International Convention Centre
Anyone who intends to participate in the Conference or Exhibition, please contact CCFA at:
Tel: (86) 10 6839 2260; 6839 2259
Fax: (86) 10 6839 2210; 6839 1317
E-mail: peilccfa@sina.com
McDonald's Expanding Electronic Payments
McDonald's, the world's biggest fast food chain store operator, announced on May 28 that the corporation is expanding a range of electronic payment systems that allow customers to purchase burgers without the hassle of digging out credit cards or bills.
In the corporation's home market of Chicago, over 400 area stores recently voted to provide customers with the option of being able to purchase menu items using a payment device developed originally by Exxon Mobil called the Speedpass. The Speedpass is a small, barrel-shaped radio transponder that customers wave at a reader located at a counter inside a McDonald's restaurant or at a McDonald's drive-through. The Speedpass is connected to a major credit card that in turn adds the McDonald's transaction to the customers' monthly bill. The transponder technology has been catching on with a number of fast-food chains, including some franchisees at KFC and Taco Bell units of Tricon Global Restaurants.
McDonald's expects 50 stores to install the reader within two years. Considering the popularity of cashless transactions, McDonald's may install the reader in all stores nationwide.
(Source: IFA News 05/28/01)
Ethan Allen, Markor Furniture to Develop Retail Stores in China
The U.S.-based Ethan Allen Interiors Inc. announced recently that it is partnering with Markor Furniture International Ltd., based in Urumqi, Xinjiang province, to develop a chain of retail stores in China.
The two companies will market both the Ethan Allen and the Markor retail programs and plan to open the first store by the summer of 2002, with additional stores targeted for the future.
Ethan Allen, a manufacturer and retailer of home furnishings, has stores in the United States, Canada and Mexico, as well as more than 20 overseas. Markor, a Chinese furniture manufacturer with facilities in Tianjin and Xinjiang, exports to the United States, Canada, Europe and other markets.
Farooq Kathwari, chairman and CEO of Ethan Allen, said in a company statement, "We are pleased with our association with Markor, and we look forward to working with them to develop the Ethan Allen brand and the Markor brand of stores in China."
Richard Feng, chairman and CEO of Markor, similarly noted, "We are very happy to have reached an agreement with Ethan Allen, a leader in retailing and brand building, and we look forward to an active and productive association in developing a retail network in China."
(Source: Xinhua News 05/16/01)
Overseas Tour Firms Seeks Shares of Mainland Market
Domestic travel agencies have found themselves in a reshuffle even before China joins the World Trade Organization. The closest threat comes from Hong Kong-listed China Travel International Investment Hong Kong (CTII), which recently unveiled a HK$2-billion ((US$256.4 million) plan to acquire mainland tourism companies.
The company is targeting travel agencies in areas such as Beijing, Shanghai and eastern coastal provinces of Guangdong, Fujian and Hainan. The acquisition plan is well under way and the company has talked with local agencies of several major travel agencies in the mainland, including China Travel Service (CTS), China Youth Travel Service and China International Travel Service, said general manager Shen Zhuying.
Like CTII, other overseas travel companies are pursuing a share of the mainland tourist market. China reported US$16.2 billion of hard currency income from international tourism and 317.6 billion yuan (US$38.3 billion) from domestic tourism last year.
But it is still not clear how CTII can acquire mainland companies, as there is a regulation that forbids overseas companies from acquiring a majority of shares in mainland travel companies. Presently, even the number of Sino-foreign travel joint ventures is limited in China, with only a few in several major cities on an experimental basis. These ventures cannot provide international travel services to Chinese citizens. The market is expected to open wider to foreign companies after China joins the WTO, but the ratio of foreign stakes would still be controlled in the first few years.
However, the shake-up of China's tourism industry is unavoidable. Smaller-sized agencies have already become targets of the stronger ones.
Guangdong China Travel Service, for example, recently took over the Shenzhen Luohu China International Travel Service, with more similar plans ahead. Luohu is one of the biggest checkpoints in China. More than 160,000 mainland travelers enter Hong Kong through Luohu each year. The purchase enables Guangdong CTS to expand its Hong Kong and overseas travel business. The company has already acquired five local agencies in coastal cities.
(Source: Business Weekly 05/29/01)
Growing Demand for High Quality Leather Products
China's leather industry is being urged to forge links with internationally known brands and to move away from an over-reliance on mass produced cheap exports.
Zhang Shuhua, deputy chairman of the China Leather Industry Association, said the industry is expected to boast between three and five international brand names within 10 years. "The country is short of really famous brands for its leather products, although it dominates world leather production after two decades of rapid development," Zhang said.
China has become a world-recognized centre for leather processing and sales. The country's leather products exports totalled US$14.35 billion last year, 24 per cent up over 1999. The output of leather shoes made up more than one-third of the world yield.
China's leather exports may be the cheapest in the world. The average price for leather shoes stands at US$6-8. Leather garments produced in China typically cost only US$40 - compared with the United States where famous brand name products can change hands for thousands of US dollars.
"It is impossible to achieve fat profits by mass production and cost saving. The leather makers should depend on brand names which rely on fashionable designs and upgraded manufacturing techniques," said Chen Huai, deputy director of the Research Institute of Market Economy under the Development Research Centre of the State Council.
(Source: China Daily 05/30/01)
Lehman Lee & Xu
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21 Jianguomenwai Dajie, Beijing 100020 China
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