The encyclopedia · Strategy & Leadership · Strategic decision · 2019–2023
Champion's overlapping China licences bled its first distributor dry and forced it out
In 2019 HanesBrands gave BeLLE a second China licence for Champion, overlapping Yongjia's. Yongjia lost HK$86M and sold the whole business for ¥104M.
HanesBrands · Champion · Yongjia Group · 2023-10-10
What happened
Champion entered mainland China in 2015 through distributors, and Yongjia Group — the Hong Kong-listed garment maker — became the sole designated distributor via its subsidiary Jiebo Trading (Hangzhou), opening the brand's Tmall flagship and its offline stores. For four years it had the market to itself.
In June 2019 HanesBrands granted a second China licence to BeLLE, whose subsidiary Fanshang Apparel (Shanghai) took over the offline retail rights and, critically, the Tmall and JD online store operations. The rights were deliberately non-exclusive, so the two licensees competed directly for the same customers, the same malls and the same traffic. Yongjia later said it was at an extreme disadvantage because the China distribution rights were not exclusive and it was no longer the brand's online operator in the country.
The overlap bled the incumbent dry: Yongjia's Champion China business lost about HK$52M in 2022 and another HK$34M in the first half of 2023. The brand itself was damaged in the market — two partners running two price systems and two product mixes, a flood of counterfeits (HanesBrands won a Nanjing court case against fake-goods sellers in 2021, fined over ¥3.88M), and Champion's first mainland flagship, opened in Beijing's Sanlitun in September 2018, closed in November 2022.
On 10 October 2023 Yongjia sold its entire Champion China business — the unsold inventory plus 69 stores — to BeLLE's Fanshang Apparel for ¥104M (about HK$111M) and left the brand behind. BeLLE was left running Champion in China alone, with the licence it had fought for.
Why it happened
- The licences overlapped by design: HanesBrands granted a second, non-exclusive China licence without splitting channels, so two partners fought over the same market.
- The second licence carried better terms — the online rights — so the incumbent lost the growth channel it had built, on top of the stores it was defending.
- Two licensees meant two price systems and two product mixes under one brand, which diluted Champion's image and let counterfeits thrive while the partners undercut each other.
- The first partner's China business was not a small side bet: the losses of HK$52M and HK$34M came out of Yongjia's own books, so the squeeze was measured in its own annual reports.
The lesson
A licence that two partners can both use is a licence neither can profit from. Hand the same market to two distributors and they compete on price until one is gone.
Aftermath
After the buyout, BeLLE ran Champion China on its own, and Yongjia exited the brand entirely. The dual-licence experiment had cost the incumbent its China business and cost the brand its flagship and much of its premium image in the market. HanesBrands later sold Champion globally to Authentic Brands Group in 2024, a separate chapter covered in its own entry.
Sources
- 腾讯新闻 — 百丽斥资1亿独吞Champion中国经营权，老经销商出局 (2023)
- 36氪 — Champion或将被出售，亚洲业绩向好难助母公司营收 (2023)
- 搜狐 — 百丽独揽Champion经销权 (2023)
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