"We plan to have 100 stores by 2011 on the mainland, with a budget worth HK$100 million (US$12.7 million). The expansion rate here is the fastest in the Asia-Pacific thanks to its huge potential," said Macy Leung, Sasa's spokeswoman.

Sasa has 52 stores in Hong Kong and Macao, 12 in Singapore and 13 in Malaysia.

On the mainland, its profits have been down. During the April-September period, it saw a drop in operating profits of US$8.7 million (US$1.1 million) on the mainland, and will not break even until the end of 2008, Leung said.

Comparatively, during the same period, Sasa's sales throughout Asia grew by 14.6 per cent year-on-year, reaching more than HK$1.3 billion (US$167 million), according to its interim financial report.

"We have been losing money here, which is within our expectations," Leung said, refusing to give more details. She said Sasa will disclose specific figures for its mainland business next July.

Unsatisfactory profits have partly come from low returns on investment in Sasa's first two flagship stores, which were set up last March and November.

Each is located in the city's most bustling areas - Huaihai Road and West Nanjing Road, and is 400 square metres.

"The rent is high in Shanghai. We aim to build up and promote Sasa's branding image rather than do business by having the two stores," Leung explained.

Sasa's other stores will cover an area of 100 square metres, less than that of the flagship stores, and will be located in the city's strategically important areas like shopping malls and high-level residential districts. Choosing a perfect site has been frustrating, Leung said.

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