Consumer product-trader Cheung Tai Hong Holdings and Interform Ceramics Technologies have set up a $35 million joint venture which will develop a franchised store chain to market ceramic tiles in the mainland.
In an attempt to cash in on soaring demand for ceramic products driven by the mainland's residential property market, the joint venture plans to open 30 stores during the 12 months to April 1999, and another 20 the year after.
The joint venture is 50 per cent owned by Cheung Tai Hong and 15 per cent by Interform.
The remainder is held by the management of the joint venture.
Under the deal, Cheung Tai Hong will take charge of sales and marketing while Interform will manufacture tiles.
Cheung Tai Hong chairman Wong Chun-hong said the joint venture would earn a $150,000 annual royalty fee from each franchisee, 2 per cent of each store's turnover, plus money from the sale of ceramics tiles to franchisees.
