Amid the retail apocalypse that has befallen the world's high streets and department stores in recent years - Forever 21 and Barneys in the US are the latest casualties - opening a bricks-and-mortar shop in a trendy neighbourhood is not the savvy investment it used to be.
For a store to make an impact and have longevity, you need to create a destination, a special place that caters to locals and visitors alike. Think of the now-gone Colette in Paris or even bigger stores such as Selfridges in London.
Eric Young, the founder of Le Monde de SHC, a three-story boutique that opened in Shanghai eight months ago, is the first to admit that his decision to open a physical boutique could be seen as "crazy" these days.
"Everyone opens businesses on Taobao or Tmall but I'm not really desperate to build a huge business," he explains when we meet him at the boutique. "I wanted to create something I liked. I actually think that there's an opportunity in the local market for a fashion and lifestyle destination like in New York or London." (Taobao and Tmall are both owned by Alibaba, which also owns the Post.)
Tucked away on a tree-lined street in a residential part of Shanghai's leafy French Concession, Le Monde de SHC (the three letters stand for Shanghai Chic) is a hidden gem: three floors housing a French-inspired cafe, a book corner, a small beauty area, a smattering of interior items and a well-edited selection of clothing and accessories from Chinese and international labels.
Creating an element of discovery is very important to Young, who selects each brand very carefully. Right now, he's excited about Marchen, a Chinese label that shows at Shanghai Fashion Week and has built a following through social media.
Le Monde de SHC also sells established Chinese brands such as Yang Li and Huishan Zhang, but there are surprises too, such as London-based label Samuel Gui Yang (another Chinese name to watch); Paris-based Taiwanese designer Peter Wu, who specialises in menswear; and jewellery brand Soft Mountains, whose pieces are made by craftspeople in Yunnan province.
Young, from a town near Chengdu, is a former fashion editor (he was part of the launch team of GQ China) who branched out into consulting and public relations with SHC, a creative agency that works with clients such as Adidas Originals.
While some may think that Le Monde de SHC is just a "passion project", Young makes clear that he is serving actual customers, a lot of them high spenders who buy Louis Vuitton or Chanel.
"I always think that I have to sell things to our clients so the product is really important," he says. "We don't sell concepts."
Thanks to its location in a wealthy pocket of the French Concession, the store has already attracted a loyal clientele of VIPs who include government officials living nearby and superstars like Chinese actress Fan Bingbing, who on a recent visit spent four hours browsing the boutique.
"My clients are the same consumers who shop at Plaza 66 and other luxury malls in Shanghai but want to find something cool," Young explains.
Forgoing fashion's current obsession with youth and streetwear, Young is instead homing in on a sophisticated clientele willing to experiment with new brands and mix established Western labels with Chinese designers.
Le Monde de SHC already carries international brands such as Holiday Boileau, Koche and Charlotte Chesnais but Young says that when it first opened, it was a challenge to sign on such labels.
"I have many Western brands coming next season but a lot of showrooms had to see (and read about) the shop first before selling to us," Young says. "If this were a shop in Japan that they had never heard of, they would sell anything to them."
As the Chinese market becomes more important to Western labels, this bias is not likely to persist. "Chinese consumers are the only ones who really buy a lot of luxury right now," he says.
Young is not surprised - but also not impressed - that Western department stores such as Galeries Lafayette have been opening branches in China.
"I don't see why Chinese consumers would go to those (sort of) stores in China because those stores here don't really carry the big brands," he says. "But to be honest, it's also the case with Hong Kong companies like Lane Crawford or I.T. When they come to China they don't realise that fashion here is a business and you have to talk to the local people and target them well.
"They pick the wrong locations and their buying is not right for the Chinese market. In China you really have to invest a lot in marketing to get good results and they don't do that."
Young says he discovers new brands during fashion week in Paris or Shanghai and on social media, and believes that the next big thing is as likely to come from Shanghai as it is from London, Paris or Milan. But he is also aware of the challenges that Chinese designers face globally.
"In the '80s you had all these Japanese designers becoming global but for us it's a bit difficult because China and the West are very different culturally and the mindset is very different. (There are also big differences) on the government side, whereas Japan has always been very friendly to the West," he says. "But I think that in a decade or so some of the biggest designers will come from here."
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.