(Photo : Bjorn Borg)

Two years after it launched sales in China, Stockholm-based underwear company, Bjorn Borg, announced that it will discontinue operating in the country, a state-owned news website reported.

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Company sources were quoted by China Retail News as saying that Bjorn Borg's operation in China has not developed and expectations are that the company's local partner will not be able to contribute to the Swedish firm.

According to the China Retail News story, the company has decided to discontinue the company's operation in the mainland this year even as sales in other markets continue to show good performance.

Sources, however, said that its China exit will not significantly affect the financial status of the entire Bjorn Borg Group. By 2014, the company said it will no longer incur expenses related to its China operations.

The company was started by world tennis champion Bjorn Borg, who rose to fame in the latest 1970s. Borg started his business selling athletic clothing line but his men's underwear became more popular.

Aside from underwear, the Bjorn Borg Group also offers sportswear and fragrances together with footwear, bags, and luggage that are sold in nearly 30 markets. Its biggest markets are Sweden and the Netherlands.

Bjorn Borg's decision to exit China comes at a time that the apparel market in the country is expected to reach CNY1.1 trillion ($179 billion) in 2016, with men's wear as the fastest growing sector. 

According to the China Apparel Industry Report, China produced a total of 5.754 billion pieces of apparel in the first quarter of this year. In the entire 2012, the country's apparel output reached 26.7 billion pieces.

The report also stated that sales of domestic men's wear will reach $66.70 billion in 2016 as more and more Chinese men are expected to pay attention to appearance and fashion. However, the report also said that Chinese consumers prefer domestic brands.