The world’s largest jewelry company by volume is facing a wave of store closures across China – a move that serves to illustrate a broader retreat by foreign brands as consumer preferences shift towards practical products that offer more value for money. Danish jewelry brand Pandora, known for its fast-paced product launches and global sales of more than 100 million pieces a year, announced in its second-quarter earnings report on August 15 that it would expand its original plan to close 50 stores in China this year to 100 stores. According to Pandora’s annual financial reports, its sales in China peaked in 2019 at USD305.73 million. But since the global pandemic, sales have steadily declined. Last year, Pandora’s revenue in China plummeted to less than a quarter of the 2019 peak.
According to the 2025 China Shopper Report released in June by Bain & Company and Worldpanel, Chinese domestic brands have steadily eroded the market share of foreign brands, with local brands accounting for 76% of the market by 2024. That was up from 75% in 2023, 74% in 2022, and 73% in 2021. Back in 2012, it was 66%. Foreign firms closing stores in China include fast-fashion clothing brands such as GU, owned by Japanese multinational Fast Retailing Group, and Spain-based Zara, as well as beauty and skincare brands such as Aesop and Decorte. Retail chains such as U.S.-based Walmart and Japan-based Aeon have also announced withdrawals from certain regional markets. Popular Japanese lifestyle brand Muji, which focuses on selling a minimalist lifestyle to the middle class, has made headlines following its string of store closures in China. The Shanghai-based China Business Network recently reported that multiple Muji locations, including in the cities of Beijing, Shanghai, Suzhou and Changsha, as well as in Zhejiang province, have shut down in recent months.
Analysts say these types of retreats can be partly explained by subdued consumer spending amid deflationary pressure, coupled with uncertainties surrounding China’s economic outlook. “Over the next decade or beyond, we will be in an era of low-price retail; this is a major trend,” said Chen Liping, Professor at Capital University of Economics and Business. “For some companies, it’s no longer just about operational challenges, but about whether they can survive.” China’s consumer price index in July was flat from a year earlier, and producer deflation continued, indicating persistent weak demand, the South China Morning Post reports.
