Lane Crawford Joyce Group, a luxury fashion retailer privately owned by Wheelock & Co's Peter Woo Kwong-ching, will invest HK$300 million to open its first self-operated department store on the mainland, after failing with all its three franchised stores across the border. The new Lane Crawford, to be opened in Beijing in October, will occupy three floors - totalling 80,000 square feet - of the new luxury Seasons Place mall. It would be followed by other self-operated department stores, including in Shanghai and Macau, said company president Jennifer Woo Chung-yan, daughter of Mr Woo. She did not provide a timetable. She said the company had changed it strategy for Lane Crawford in order to gain 'better control' of operations, closing earlier this year the franchised stores in Shanghai, Hangzhou and Harbin. These stores were too small to match the new goal of each outlet being between 80,000 sq ft and 120,000 sq ft. Lane Crawford's Hong Kong flagship store in IFC mall covers 82,000 sq ft. The group, which distributes products for luxury brands such as Hugo Boss, Stella McCartney and DKNY, already has a strong presence on the mainland with its single-branded stores. It aims to open 50 mainly single-branded stores in the region this year for a total of 500 in Asia, of which 223 will be on the mainland. The high-end department store's move back into the mainland comes as the country's surging economy is creating better off and brand-conscious people more willing to spend on luxury items. A recent Goldman Sachs report found that the mainland is the world's third-largest consumer of luxury goods, accounting for 12 per cent of global sales, behind Japan's 41 per cent and 17 per cent for the US. The report predicted that the mainland would become the world's second-largest purchaser of luxury goods by 2015, with 29 per cent of such sales. Lane Crawford Joyce Group president Bonnie Brooks expects sales of the Beijing store in the first year to reach 80 per cent of sales of a Hong Kong store but she declined to specify a figure. She said the company had no plans to fund its expansion by seeking external financing, including by listing the group's shares or bringing in outside investors, such as LVMH, an arm of the world's largest luxury products group Moet Hennessy Louis Vuitton. While bullish about its mainland plans, Lane Crawford faces tough competition from fashion brands such as Louis Vuitton and Gucci and premium department store operators such as Parkson Retail Group. Italian luxury goods maker Salvatore Ferragamo, for example, plans to double the number of its outlets on the mainland to 50 by 2010. Parkson, which has outlets of brands including Hugo Boss, Dunhill and Lancel and operates three stores in Beijing, will open at least five outlets on the mainland this year. Lane Crawford Joyce Group, which also owns a controlling stake in Hong Kong-listed Joyce Boutique, predicts the group's sales for the 2008 financial year to reach more than HK$7.8 billion, according to Mrs Brooks. She said the group's same-store sales grew 23 per cent in the previous fiscal year. Mrs Brooks said this was the first time her group had disclosed sales details because it wanted people to understand the retailer's positioning, not to interest investors.