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Down-Under Wonder Cotton On Group Unveils Aggressive Growth Strategy

Low-cost Australian retailer Cotton On Group (COG) is gearing up to open 570 stores around the world within three years to take its total to nearly 1,900 by 2018.

The privately-owned company also plans to boost online sales to $191.5 million (250 million Australian dollars) by expanding its e-commerce offering with new online sites, improved digital content and click-and-collect options.

The value-fashion group, which offers casual apparel, accessories, footwear and home goods at inexpensive prices for men, women and children through its brands: Cotton On, Cotton On Kids, Cotton On Body, Supre, Typo, Factorie, Rubi and T-bar brands. The brands are in more than 1,300 stores and in 17 countries including Australia, New Zealand, Malaysia, Singapore, Hong Kong and the U.S.

Sales are forecast to jump 22.5 percent to $1.05 billion (AU$1.51 billion) this year.

The organization also plans to add 227 head-office jobs as well as more than 2,000 retail positions globally before the year’s end. In a bid to bolster this, COG has invested $22.9 million (AU$30 million) in an education and training platform in conjunction with Australia’s Deakin University to improve retail and leadership skills.

Since its launch in 1991, COG has grown to become Australia’s largest affordable apparel retailer. Despite falling into the same international fast-fashion waters as Zara, H&M, Topshop and Uniqlo, the group has managed to maintain 20 percent-plus sales growth for the past five years by keeping its trendy threads under $50 a piece at retail.

Not to mention, its supply chain rivals that of its competitors. Products, manufactured by 170 suppliers at 330 factories, mainly in China and Bangladesh, are shipped two to eight weeks later to seven distribution centers in Melbourne, Brisbane, South Africa, China, Singapore, California and New Zealand. A quick scan of the current Cotton On collection reveals such on-trend items as chunky-knit tanks, muscle midi dresses and ripped boyfriend jeans for women and cuffed drop-crotch pants, chino joggers and baseball tees for men — sure to satiate shoppers seeking faster, cheaper, trendier offerings.

While COG does not disclose earnings, some estimates have valued the group at more than $766 million (AU$1 billion).