Xieheng, the second largest mobile phone retailer in mainland China, has entered the cosmetics market.

According to Mr. Yao Bo, former supervisor of Xieheng's Mobile Phone Development Department and now vice-CEO of Shanghai Yiting Cosmetics Company, Xieheng will invest CNY100 million in the coming three years to build chain cosmetics stores and expand to other cities including Guangzhou and Chengdu.

Yao says there is no large cosmetics retailer in China, other than Hong Kong's Sasa chain, that is the main reason why the company turned its eyes to the industry.

But he says that different from Sasa, which is oriented towards high-end customers, Xieheng's goods will mainly be aimed at the middle class.

There is no comment from the company about whether it plans to also sell mobile phone products via these cosmetics stores.