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Coronavirus halts Wrangler expansion in China

Jeanette Settembre

Denim jeans maker, Wrangler, will delay its expansion plans in China amid the fast-spreading coronavirus, the chief executive of the company's parent said Thursday.

Wrangler jeans parent company, Kontoor Brands, was scheduled to expand production in China this spring, however, with the spread of the deadly coronavirus, which has killed at least 2,918 people and infected more than 81,100 people across the globe, has halted expansion.

“Given the current environment, we believe the proven course of action is to delay the launch for a short-period until fall of this year, when we can more effectively optimize our go-to-market strategies, our interactive consumer engagement and better leverage our demand creation spent,” Scott Baxter, Kontoor Brands CEO, said on an earnings call. “While the team is extremely excited to get going and we are ready, this is the best decision for the brand and most importantly our employee’s safety. We remain optimistic about the long-term growth potential of this market for both our brands and we will execute against our strategies to most effectively capture the opportunities.”

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A number of U.S. retailers have struggled with getting inventory and products from overseas as Chinese factories remain understaffed. Retailers like Neiman Marcus, Jo-Ann Stores and J. Crew have all been affected. And U.S. retailers could face even more challenges later this year if production in China doesn't bounce back by April, the Wall Street Journal reported.

Kontoor Brands' Lee line is one of the biggest denim brands in China. The company announced its expansion plans for Wrangler in the world's largest consumer market as the trade war between the U.S. and China escalated last year.

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