Discount Clothing Brand: Ideal, Bottleneck, And Future.

There was a time. Discount chain brand A hurricane has attracted people's attention. with ITAT As a representative of the discount chain business model, the rapid rise and fall quickly, and even not yet fully understood, then quickly withdraw from the stage. Guangzhou Di Mike Dio costumes General manager of limited company Yellow River This is not the true face of discount chain brands. People's understanding of discount brands needs to be deepened and improved.

The ideal is full and the reality is very skinny.

Guangzhou dike Dior Clothing Co., Ltd. is also a clothing discount chain enterprise. Unlike ITAT, they have chosen a more robust development path.

The main innovation of ITAT was the business model. A free trading platform was set up for small and medium-sized enterprises and developers with idle property: manufacturers (suppliers) are responsible for supply; owners (venue providers) are responsible for providing property sites; ITAT is fully responsible for store management. The three parties share risks and share profits: the property owner assumes the risk of floating field rent, and the supplier takes inventory risk and logistics distribution costs.

ITAT is responsible for promotion expenses and wages. The Yellow River also admits that in theory, the logical structure of this model is quite simple and perfect. First, it is extremely light assets and the cost of opening shops is very low (the cost of opening a branch of ITAT is about about one million yuan), so that it can expand explosively in a short time, form a nationwide retail chain network, realize scale advantages, and secondly, pass the risk of most retail formats to suppliers and owners, and their risks are very low.

However, in the crazy expansion of "light assets", ITAT did not balance the relations among several elements, and did not lead the consumption idea well. The core of the whole mode -- high cash flow and high asset turnover rate dried up gradually, resulting in poor turnover.

The failure of ITAT has prompted the Yellow River to think more deeply about the discount chain mode. Also started in 2005, Di Mike Dio chose a completely different form of development from ITAT at the very beginning. Instead of concentrating on fast opening, they focus on building relationships with manufacturers.

"We need to digest inventory for the brand enterprises, but we need to do a lot of work to get the trust of these brands. For example, how to ensure that they do not sell goods do not affect their sales of genuine products.

In addition, we need to have enough capital to ensure that all of their stocks are taken over. " In the negotiations with manufacturers, Di Mike Dio's cash payment is an important weight, which is a win-win choice for some brand enterprises that need to revitalize their assets. In cooperation with Dior,

19 years of age into the clothing circle, years of accumulation, let the Yellow River have a very deep understanding of the clothing industry. He said: "every brand enterprise will have inventory, generally controlled in 10%~20% inventory is called safety stock, these stocks often lack the appropriate processing channel, to deal with distributors, will affect the sale of genuine products, do their own sale, and not enough manpower and material resources. Therefore, how to digest inventory is a common headache for brand businesses.

In foreign countries, this special digestion brand enterprise inventory discount chain mode has existed for a long time, and has produced a number of well-known discount brand, such as FOXTOWN. The Yellow River believes that the demand for discount chain mode is even more urgent due to the large number of Chinese brand enterprises. The discount chain model has a bright future.

In order to win the trust of brand enterprises, the the Yellow River dike Dior discount chain has been insisting on cash receipts and integrity. Once it comes to the spot with the brand dealers, it will immediately withdraw the shelves, give priority to the interests of brand dealers, and avoid the worries of enterprises. Now, Di Mike Dio has established good cooperative relations with seven hundred or eight hundred brothers, such as brother, Jiangnan and so on.

With the deepening of market cultivation, Di Mike Dio has at most more than 3000 stores nationwide. As most of them are in the form of franchise, the increase in shops has made the Yellow River feel the pressure and bottleneck.

"The difficulty now is the management of franchisees. Thousands of franchisees, different levels of management, the difficulty of management is too large, even without locking, the control of enterprises to franchisees is weak; on the other hand, the development of discount industry in the past few years is blind and disorderly, mixed with good and bad, and the whole industry leaves people with a bad impression. The Yellow River is concerned about bottlenecks both in itself and in industry.

"The most common problem I am considering now is how to manage my franchisee well, and what is the way to make the whole industry more standardized." {page_break}

Play the leading brand demonstration effect

After careful consideration, the Yellow River has decided to gradually increase the number of self operated stores in the diske Dior discount chain and reduce its franchise ratio.

At present, Di Mike Dio has more than 2000 stores nationwide. According to the plan, more than 500 high-quality customers will be retained in the future, and the rest will be self-employed. In 2011, Di Mike Dio will open 100 self run stores in Guangdong. The advantage of self operated shops is good management. For an industry that pays special attention to honest management, only by doing self operation can we ensure the smooth implementation of brand headquarters management ideas.

Since the second half of 2010, Dior has begun to try foreign trade exports, which is undoubtedly an important breakthrough in dealing with the discount based on inventory.

It is an imaginative thing to deal with the stock of brand enterprises abroad. It has proved that this idea is not an idiotic dream. In the past two months, Di Mike Dio has sold 1 million 500 thousand stock products abroad, including Africa, the Middle East, and even Europe.

The opening of foreign trade channels will give the Yellow River more confidence in the future development of enterprises.

"We sell our products abroad, and our domestic enterprises are more motivated to cooperate with us, because their concerns are no longer there, and the establishment of our own system will also help regulate our domestic market. Dior will gradually establish the identity and status of the leading brand in the industry."

The Yellow River hopes to learn from McDonald's and KFC's development model, open shop first, and then switch to maturity after operation. He said that only in this way can we ensure the benign development. Moreover, after self employment, Di Mike Dio will gradually build his own discount brand. All the products in the store will be replaced by their own trademarks, so that more standardized and clearer brand images will emerge.

For the current problems in the field of discount chain sales, the Yellow River believes that the benchmarking role of powerful brands should be taken into consideration. The more irregular market, the more leading companies need to play a good example.

In order to make their enterprises stronger, the Yellow River is now focusing its efforts on the personnel structure and the specific work of goods and financial management.

The discount chain model is not without prospects.

The failure of ITAT is only a deviation from the operation and the way and method. The industry has potential as a whole. "

According to the latest news, in December 15th, the China Hui Ying joint supply chain group held a news media meeting to announce the merger of ITAT group. Does this mean that the resurgence of the discount sector?