Haagen-Dazs feels the heat in smaller cities

Rising rents and lower profits have forced General Mills Inc's ice-cream brand Haagen-Dazs to close stores in second- and third-tier cities in China amid a slowdown in the ice-cream market mainly due to a lack of innovation and its inability to keep pace with demand from increasingly sophisticated Chinese consumers.

"We have adjusted our stores in second and third-tier cities due to slower economic growth in those regions," Haagen-Dazs said in an email reply to China Daily on Monday.

But the US ice-cream chain said a "5 to 10 percent adjustment in store numbers" is normal". The brand has 380 stores in 84 cities in the country, despite the challenges at markets in second and third tier cities in the country, according to the email statement.