As Lavoie and Janet De Silva, company Chief Executive Officer, were overseeing Fruits and Passion's expansion—its 12th store opened in December 2007—they were regularly asked by retail developers if they had other brands. Lavoie and De Silva explored the possibility of applying their approach more broadly and Retail China was born.

De Silva says Retail China offers a low-risk way for mid-market brands to get established in the Chinese market. Retail China shoulders the financial risks in exchange for long-term rights.

"We've been very pleased with the response so far," says De Silva. "I think we are an appealing partner because international business people like to be able to talk with those who can navigate in China. Gervais has been here 31 years and speaks Mandarin—he is a Canadian with Chinese credibility. We also understand the sort of worries Canadian businesses may have."

De Silva is impressed with the support she has received from the Government of Canada. Through the Trade Commissioner Service in mainland China and in Hong Kong, Retail China has made valuable contacts with Canadian retail chains. And Export Development Canada "combed through its database to identify companies that would be worthwhile for us to approach."

While the market potential is staggering—by 2009, the number of middle-income consumer households is expected to triple to 105 million and reach 612 million by 2017—De Silva says it is important for retailers to recognize the difference between Chinese and North American consumers.

"The most fascinating aspect of the Chinese market is that it is comprised of first-generation consumers - they haven't had an international retail experience before," says De Silva. "With the exception of luxury-brand stores in major cities, the typical experience was an old-fashioned department store, where a customer approaches a clerk at a counter…it was neither engaging nor stimulating. Now they have large discretionary spending and what is known as "aspirational lifestyles"—they are pre-disposed to look at name-brand products."

De Silva says it is important that retail locations have integrity in the minds of consumers, so that they are confident in the product. "If you have a premium-priced product and the mall puts you in a space beside someone selling knock-offs, you are not going to do well. Savvy retail partners understand which brands create the best mix."

And, while brand protection is something that must be given serious consideration, De Silva says she has confidence in the Chinese legal system. "It will support international brands if companies make investments up front to protect themselves. Companies need to approach China like any other market—select their partners carefully and take steps to protect their products."

Just as Chinese consumers are not accustomed to a Western shopping experience, the labour pool has not been exposed to customer service principles. Whenever Retail China introduces a new brand, it immediately hires a brand manager. This person begins by spending time in the home market (Quebec in the case of Fruits and Passion) to gain a full appreciation of all aspects of the brand. On returning to China, the manager uses this understanding to ensure Chinese stores conform to the brand's look and feel and to train the staff who will work there.

Chinese consumers are looking for an international brand and Retail China provides it through labeling, brand protection and ensuring an international retail experience. According to De Silva, "there is a lot to think about because it's a first-generation consumer being targeted."

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