The strong economic growth in China and higher disposable incomes has also increased the expenditure for newborns significantly during the past five years.

In China, the average annual spending by a family on a child has doubled in five years to 4,508.6 yuan in 2009, according to a study by Frost and Sullivan, a US market consultancy.

The study showed that sales of child-care products in China increased to 165.3 billion yuan in 2009, up 123 percent from 2005. It predicted that sales of such goods will increase to 311 billion yuan by 2013.

Leong says shoppers on an average spend around 300 yuan to 500 yuan on each purchase at her store, with over 50 percent of them being repeat customers. The company's products are mainly targeted at middle-class families with a monthly income of over 7,000 yuan.

A report by Euromonitor pointed out that the middle-class group in China will increase to 700 million by 2020 and account for 23 percent of the total population.

The implementation of family planning policy in China has made young parents, born during the 1980s, spend more on children's products.

Liu Yue, born in 1982, says the quality of the materials and design are the top considerations when it comes to buying clothing and toys for her three-month-old daughter. "Price is the last consideration when it comes to buying things for my daughter," she says.

"I prefer branded products because the quality and safety are guaranteed," says Liu. "I want the best for my daughter so that she can grow up in a healthy and comfortable environment."

Though the long-term prospects for the children's products market is good, the intense competition could cloud prospects for companies, says Leong.

"There are many domestic brands competing in the high-end market," says Leong. "What we can do now is to open more stores in China and focus on brand refurbishment."