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Elaine Chan

CLOTHING retailer Giordano International has closed its Shanghai business abruptly, citing 'internal adjustments' for the move.

  Thomas Wong, the head of Giordano's operations in Shanghai, confirmed the move and said the closure started yesterday. However, a Shanghai source said it had been effective from Thursday.

  Giordano has 11 franchised outlets in Shanghai, in prime districts such as Jingan, Huangpu and Luwan. It is not known how many stores were affected.

  A Giordano official in Hong Kong said all outlets in Shanghai were franchised and were handled by the company's subsidiary, Tiger Enterprises.

  No one at Hong Kong the headquarters was available for comment last night.

  Mr Wong emphasised that the closure was a decision made by the company.

  'It is due to the company's internal adjustments. It is hard to say [when business will resume],' he said.

  'This will depend on the Shanghai Industry and Commerce Administrator.'   Mr Wong became evasive when asked whether the company had received instructions from the bureau to close its business.

  'It is because of manufacturing problems,' he said.

  An article this week in a Shanghai newspaper questioned the quality of Giordano garments.

  The report said a consumer had complained that numerous holes were found on a woollen top she had bought from Giordano for the Lunar New Year.

  Officials from the Shanghai's Commercial Departments said they had not heard anything regarding the closure.

  An official from the Shanghai municipal government's finance and trading office said: 'We have not heard of anything. It is possible that it is nothing much because Giordano's influence [as a retailer] in Shanghai is very small. Most people prefer to go to places such as Hualian Commercial Building, Shanghai Orient Shopping Centre and Shanghai No 1 Department Store.'    The closure comes in the wake of Giordano's announcement of ambitious plans to open 1,000 franchised stores in China by the turn of the century.

  The company's China business generated sales turnover of $530 million, about 15 per cent of group turnover, and contributed $51 million in net profit.

  There has been speculation that the closure in Shanghai is politically driven decision.

  Sources also said Giordano product advertising has been banned in the city since January.

  The company sparked controversy when Chinese authorities closed its Beijing outlet in August 1994 after founder Jimmy Lai Chee-ying criticised Premier Li Peng in his Next magazine.

  Mr Lai who is also the publisher of Apple Daily newspaper, recently sold his entire stake in Giordano.

  The newspaper has been unofficially banned from covering news in China.



Closures hit Giordano outlets in Shanghai