Clothing discounter Kik shelves US expansion plans as trade war looms

Affordable clothing retailer Kik has dropped its plans to enter the US market. “Because of the current difficult international environment and the trade war threat between America and China, but also between America and Europe, a US launch is at the moment too high a risk for us,” Kik boss Patrick Zahn told Handelsblatt. Instead, the company will focus its efforts on growing in Europe.

The clothing discounter had announced almost two years ago that it would enter the US market in 2019. “We are convinced that Kik fits perfectly in the USA,” Zahn said at the time. This is because there are no specialist clothing discounters in the US, giving the company almost unlimited growth potential.

But the risks seem to be too high now for the CEO of Kik due to US President Donald Trump’s trade policy. “The impending tariffs would hit us hard and largely negate our value advantage,” he told Handelsblatt.

The textile discounter will now accelerate a planned expansion in Europe, Zahn said. The first Romanian Kik stores are due to open this year. And for 2019 o 2020, the company plans to enter Belgium and France.