Hongguo is in expansion mode

Hongguo International, a manufacturer of ladies shoes in China has made plans to expand its production facility in both the Nanjing and Dongguan facility. The Nanjing plant will see its production line increase by 1 from 3 and the Dongguan plant by 2 from 3 lines and the expansion is expected to be complete by end of June 2007. The total cost will be around RMB18 million Yuan and will increase the production output by 50% increasing the shoes manufactured from 2.52 million to 3.90 million pairs.

In addition to this expansion plans, the company has signed a Memorandum of Understanding (MOU) with San-Diego based KIA Group Inc., (KIA) – a designer and manufacturer of fashion footwear in the US. Under the MOU, Hongguo will receive exclusive distribution rights for Naughty Monkey footwear for next five years in China. In the first two years, Hongguo will sell the Naughty Monkey footwear through its in-house E.Blan footwear stores, which number 108 as at end 2005. From the third year onwards, the company plans to start Naughty Monkey branded stores and it plans to have as much as 210 such individual shops for the new brand, as well as sales of one million pairs of Naughty Monkey shoes. The 'Naughty Monkey' brand is currently targeted at young, urban females between 18 to 35 years of age and fits in well with Hongguo's other brands. Hongguo's share of distribution revenue will also improve as a result of this.