The Retail Brand Expansion Of Wan Dian Era Sports Brand Is Homogeneous And Vicious Competition?

For now Clothing industry The "expansion impulse" within the industry is known as " Wan Dian Era " The arrival of the "Wan shop era" reflects not only the expansion of market capacity, but also the expansion of market capacity. Brand strength The increase is also reflected in the acceleration of market integration and the amplification of operational risks.

Jibin: Brand Manager Deng Bo Tao, Zhejiang Han Bo Marketing Co., Ltd.

Wang Zhidong, brand manager of noble bird group

Xiang Qingping, general manager of Hubei Cheng Feng Trading Co., Ltd.

No country can provide a single brand of thousands of retail outlets like China. Now, in the recent expansion of the three or four line blank market, China is likely to breed a number of brands instead of a brand.

These brands are accumulating their total number of stores by increasing the scale of thousands of retail stores each year. They even include many of the past industries that are generally defined as "second-line brands", such as "noble bird" and so on. When entering the expansion period, the noble bird claims that there will be 1000-2000 new stores every year in the future.

These brands generally have more than 5000 stores' terminal sizes, which are quite similar to the global apparel retail giants such as GAP and ZARA, but their performance is far away. As a result, when the wave of terminal expansion is coming, is it necessary to discuss the necessity of "Wan Dian" scale? Is there a non market factor in the "Wan Dian era"? What is the meaning of its existence? Is there any bubble in the expansion of the terminal expansion?

The author: at present, many domestic retail brands in the clothing industry are expanding their terminal network, especially the sportswear brand and leisure brand. How do you view this phenomenon? Why is there such a trend?

Wang Zhidong: now many domestic apparel enterprises' terminal network has reached the scale of 5000 or 6000 stores. There are also several brands with more than 7000 stores. I personally believe that this is mainly in the stage of rapid development of enterprises, and the capacity of the market is large enough to accommodate so many branches. Just like we have only 27 sales regional markets in China, there are only 20 to 30 sales areas with very few brands. Therefore, we still have many regional markets in China that have not yet been involved in the development. There are lots of shop opening spaces, which are far from saturated.

At the same time, as the expansion of our shop is mainly in the three or four line market, these regional markets have been blank before. For us, after the accumulation and growth of the enterprises, we need to lay out the market in these markets and set up the scale rapidly, and seize the opportunity to spread the market. Therefore, at present, the birds are also expanding rapidly. We now plan to open 1000 to 2000 stores every year, and so far, we have more than 5000 shops.

Deng Tao: first of all, in my view, the capacity of the Chinese market is large enough to fit the scale of "Wan Dian". At the same time, after years of industrial competition, the market has formed a powerful and scalable brand.

Now, as long as the sales are guaranteed, there is a source of tourists, their own funds, talent reserves have accumulated the brand can scale expansion. Of course, there are many brand expansion "services" listed on the need, they will expand the retail terminal in the short term, because the need for the listing of the brand has a huge terminal network, which is fixed assets, can give investors confidence. At present, before the listing of service companies, the number of short-term "assault" terminals has almost become a convention. They will give agents a lot of preferential policies during this period to encourage agents to expand their stores. Subsequently, agents will give the same support to the following franchisees to stimulate them to open their stores.

To Qingping: This is mainly the expansion of the national brand group. In the past, many brands were limited to insufficient strength and could not lay the market nationwide. Now, with the growth of their strength, they have the ability to expand the market nationwide, and many district markets are becoming more mature. Therefore, a large number of brands have joined the national competition.

The author: apart from the reasons of the market level, is there a reason for the opening up of shops at the non market level? Is the number of hundreds of stores opening up a little too much each year?

Deng Tao: over the years, I have often visited the county level market and found that many brand stores have come out. Many of them have done well. Therefore, I think there is no excessive problem in the terminal expansion of enterprises.

However, if we take the clothing industry as a subdivision, there are some differences between the two main brands of sportswear and sportswear.

At the moment, I do not see clearly the competitiveness of sports brands, I can not see their competitive means. Although they are enthusiastic about promotion and sponsorship, there is little difference in product design, including research and development, and sports brand. The reason why their expansion is so big now is that their personal development is mainly because they have developed too slowly in the past few years. This reminds me of Fujian's menswear brand in the past. It is also homogenization of vicious competition and scale expansion.

From this, I feel that the current sports brand may shrink and precipitate after this wave of expansion, and then usher in a new stage of development.

However, I am more optimistic about the expansion of casual wear brands. In my view, they are more likely to become the members of the "Wan Dian" club. Because the mid end positioning casual wear market is very large, and at the same time, he extends more space to other categories of clothing.

For example, casual wear brands can make sportswear series, while sports brands are hard to develop casual wear market.

Wang Zhidong: for brands, there are strategic considerations in the large-scale opening of new stores. For example, in recent one or two years, there has been a listing plan for the birds in the market. Therefore, the layout of the market should be consistent with this strategic goal, and a certain number of shops will help us to plan for listing. This is also applicable to many domestic clothing brands nowadays.

However, I do not think that the retail terminal is over expanding, because many markets are still developing. Many regional markets still do not scale in, and our profit return is very good at present. The loss of new stores is not obvious. Therefore, in my view, the current large-scale open shop in the industry is still a need for enterprise development. However, in the future, after the expansion of large-scale terminals, competition will become more intense and the market will be further integrated.

To Qingping: this should be a specific look at the subdivision of clothing. In the field of sportswear, personally, I think it is excessive. Nowadays, the problem of homogeneous competition among sports brands is very serious. Taking the Hubei market as an example, in recent years, a large number of sports brands have entered the Hubei market. These brands have started almost simultaneously, and have been expanding to the whole country. Therefore, the competition between them has turned into a simple scale and the competition of the number of retail terminals. Whoever enters first will have the advantage. Whoever will scale first will take the initiative. This causes the profit margin of the whole industry to drop. For the new market entry, we have to set up branches on a large scale, stabilize a market, and squeeze out other brands at the same time, which not only increases the operation cost of the brand, but also loses profits because of the fierce competition of homogeneous products.

According to our investigation, at present, more than 90% of the main commercial streets in Wuhan, Hubei, such as Jianghan Road, are not profitable.

In the short term, large-scale expansion of terminals will also bring more cost burden to enterprises and bring more challenges to management and management. At the moment, do you feel this kind of challenge? What is the biggest risk for the terminal expansion boom?

Deng Tao: there will be risks and blind expansion in the expansion of brands, and the expansion of sports brands that are not so obvious will inevitably lead to the fatigue of consumers. Therefore, after expansion, the brand may be forced to shrink immediately. This contraction is mainly manifested in the fact that the brand has incorporated the agency or directly turned it off.

At the same time, the unsuccessful expansion will also have a negative effect on the long-term development of the brand. Once the brand is blindly expanding and has a negative impression in a certain market, it will be very difficult for the brand to enter the market again.

Wang Zhidong: because the new storefront is mainly a franchised store, the main difficulty of brand operation is probably to coordinate the relationship with the franchisee. For example, how to give franchisees support, encourage them to open stores, and carry out effective unified management and so on.

To Qingping: the biggest risk is profit. If everyone does not make money, the agent will not have the enthusiasm to open and operate. This requires brand differentiation rather than competition of scale and store size. Only differentiation will have competitiveness and high added value space, and can bring profits to dealers.