Good Steel Should Be Used In The Correct Marketing Of Clothing Enterprises.

With the increasing willingness of enterprises to build brands, the proportion of production costs in total costs will inevitably decrease, and the cost management of enterprises will become increasingly complex.

Domestic garment enterprises must improve the level of supply chain management and jump out.

I. cost structure

For China's clothing industry, the most important source of market competitiveness is "cost advantage", and the "labor cost" is the most important factor.

In the middle of 2009, although the industry was also facing

Judging from the cost of garments, Chinese garment enterprises are losing their "cost advantage" before being increasingly arrogant.

China's manpower cost is higher than that of Vietnam, India, Pakistan, Bangladesh, Turkey, Indonesia, Mexico and other countries. Before China had the advantage of raw material export, but with the deepening of the global procurement system and the increase of raw material production ratio in the less developed countries, it seems that the biggest advantage of the Chinese garment industry in the future is "the most complete garment industry chain".

At present, the biggest source of cost pressure of Chinese clothing enterprises is

In this regard, Sun Ruizhe, vice president of China Textile Industry Association, made a judgement: "the continuous rising of production factor prices in 2010 has become a prominent problem in the operation of the industry at this stage".

Moreover, distress is not unique to manufacturing enterprises. For domestic emerging "Light Companies" and brand service enterprises, although outsourcing can be produced and the cost can be pferred to OEM by strong bargaining power. However, due to the lack of experience in brand marketing and channel maintenance, enterprises are also wasting a lot of money and time in the early stage of pformation.

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Taking seven wolves as an example, although the number is beautiful, sales revenue is 974 million yuan, up 10.67% compared with the same period last year, net profit is 124 million yuan, up 31.02% compared to the same period.

But at the end of 6, company accounts receivable amounted to 312 million yuan, an increase of 114% over the same period last year, far exceeding revenue growth.

The increase in receivables was mainly due to the increase in the company's credit limit. The integration of channels resulted in a 83.2% decrease in operating cash flow in the first half of the year.

Under normal circumstances, the cost of clothing manufacturers mainly consists of five main components: first, the raw materials for clothing account for about 60-80% of the total cost; the two is labor cost accounting for about 10-25% of the total cost; three, water, electricity, steam, pportation and other manufacturing costs account for 8% of the total cost of the left and right; four, business, management and financial costs account for about 6% of the cost; five is about 6% of the external processing cost of the product.

With the difference of product subdivision, the proportion of expenses in product cost is slightly different.

Simple garment manufacturing enterprises are the most influential segments of the rising cost of raw materials and manpower. This is also the biggest reason for the pformation of China's garment industry.

In addition, for brand clothing, there are two parts of the cost accounting for a large proportion, one is channel operating costs, the first is brand marketing costs.

The cost of these two parts fluctuates greatly with the change of brand operation level.

Taking the United States and the seven wolves as an example, I believe that with the slowing down of the construction of Direct stores and the return of agents' credit lines to normal levels, the level of profitability will be greatly changed.

In addition, this year the RMB exchange rate against the US dollar has seen its biggest one-day gain in nearly 20 months, reaching 0.428%.

Let export enterprises once again be scared out of a cold sweat after the international financial crisis.

Because 80% of domestic textile and clothing exports are settled in US dollars, the appreciation of RMB has a greater impact on outward oriented domestic clothing.

Relatively speaking, it has the biggest impact on small and medium-sized enterprises, and has a relatively small impact on large enterprises with stable customers and bargaining power.

The excessive appreciation will make the export profits of most OEM enterprises substantially diluted.

In addition, the appreciation of the renminbi will also affect the cost reduction of enterprises.

At present, the average profit rate of China's garment industry is only 3.97%, and the profit margin of nearly 70% of enterprises is below 4%. If the fluctuation of RMB exchange rate is slightly larger, it will cause a devastating blow to it.

Two, pay attention to channel construction.

The sluggish market in Europe and America, as well as the rising domestic market, not only attract the export capacity of export enterprises, but also attract foreign brands to intensify the division of China's consumer market.

The market which has already been fiercely competitive has been heating up day by day.

For service companies, the construction and maintenance of channels, especially self operated channels, have never been urgent.

After delineating the market in the first tier cities, NIKE came to the news at the beginning of the year to sink the channel to the two or three line city, which led the attention of the enterprises to the two or three line cities.

Moreover, the second line brand, which is specifically focused on the two or three tier market, shows a strong defensive nature.

But the sinking of the channel also means the construction of new channels. In the short run, it has a rather adverse impact on the cost of enterprises.

At present, the channel mode of the clothing industry is mainly represented by the agent system of seven wolves. The direct operation system represented by YOUNGOR, the franchise system and the four channels of e-commerce channels represented by Metersbonwe, but the proportion of Direct stores and self operated stores has increased rapidly in recent years, especially the brand clothing enterprises have begun to increase investment in channel construction for the purpose of controlling channels.

The cost of construction and maintenance mainly includes store rent, decoration, personnel costs, marketing expenses and financial support.

In particular, the direct channel is "big family". Therefore, the expansion of the channel should be determined and the pace of expansion will be well controlled.

In particular, the high price of real estate, the rising cost of human resources, and the decline of marketing effectiveness have increased the financial pressure on the company.

Take the United States for example, in 2008, 1 billion 800 million yuan of funds raised by the company went public, about 90% for marketing network construction, especially for direct network construction, resulting in a significant increase in related sales expenses.

In 2009, the new brand MC's brand channel construction cost about 500 million yuan, the cost of team building was about 40 million, the brand publicity cost about 40 million, and the income contribution was only about 360 million yuan. Although in the long run, the direct network can contribute continuously to profitability, but for the listed companies, it is necessary to balance long-term interests and short-term interests.

In June, the United States has adjusted its channel strategy and plans to slow down the construction of direct network.

Relatively speaking, the channel expansion tactics of the seven wolves were more mature. In the first half of 2010, the seven wolves adjusted the channel expansion strategy.

On the one hand, we should close some of the disadvantageous franchised stores to save part of the cost. On the one hand, we should take advantage of the industry trend of channel sinking, pay special attention to the layout of the three tier cities, and encourage the new stores to invest in smaller shopping malls at the beginning to avoid the pressure of rent rising on the channels.

So although there were 79 new outlets in the first half of the year, the sales cost rate was only 14.15%, or even 2.95 percentage points lower than the same period. At the same time, the seven wolves also increased the credit limit for agents.

Although the financial pressure is not large, the expansion effect is very significant. In the first half of the year, the gross profit margin of the main business of the company increased by 5.09 percentage points to 42.53%, and the profit growth rate was obviously faster than that of the revenue growth.

Compared with foreign-funded enterprises, the cost of domestic construction enterprises' channel construction is still very low.

Take ZARA as an example, its store is not only a place of sale, but also a window of demand analysis.

Because of this, ZARA has a strong desire to control stores, so the degree of informationization is very high.

It is convenient for each store manager to report the latest sales information and fashion information to headquarters immediately. ZARA even has specially designed portable data pmission equipment for each store manager.

Taking ZARA's investment in Nanjing West Road stores in Shanghai as an example, the investment in hardware and software alone is more than 1 million yuan.

Three, related costs {page_break}

Clothing manufacturing enterprises generally account for about 6% of the cost of business, management, and finance, but for brand service companies, with the difference of enterprise mode and focus, the relative cost ratio varies greatly from 10-35%.

The product processing fee also varies greatly with the change of enterprise mode. For example, the outsourcing processing cost of manufacturing outsource is almost equal to the production cost, and the average manufacturing enterprise is about 6%.

Marketing expenses such as advertising and public relations are the biggest changes in the cost of clothing enterprises.

The marketing cost of garment manufacturers is not proportional to revenue, and the marketing cost of brand clothing enterprises can even account for more than 20%.

At present, the domestic listing does not disclose the obligation of advertising costs, so the cost of advertising and public relations of many enterprises is mostly valuations, and Hong Kong stocks do better in this respect.

For Lining, the advertising cost in 2009 accounted for 15.4% of the revenue.

According to the marketing style of the local enterprises, the proportion of marketing expenses such as advertising and public relations has been very high. In the different periods, Aaron Kwok, Willber Pan, Angela Chang, Jay Chou and Wentworth Miller have been employed as spokesmen, and the core marketing is integrated through product display, shop design, advertising and public relations planning.

Therefore, in 2008, the operating cost of the company was more than 900 million yuan, which was nearly 21% compared with the operating income, which created the largest number of listed companies.

In the first half of 2010, its sales cost was 875 million. Fortunately, the high marketing cost and firm brand strategy also created the brand reputation and reputation of the United States.

Generally speaking, the cost of publicity should be maintained at around 10% of revenue, especially for large garment enterprises, which is more effective than the marketing mode.

At present, the proportion of most garment enterprises in China exceeds this standard.

The reason is mainly due to the fact that domestic garment enterprises prefer traditional expensive TV advertisements and lack of experience in big event marketing, so the efficiency of brand building is relatively low, resulting in high cost.

Not to mention the dead PPG, for example, the current cost of advertising is about 20% - 30% of the total expenditure, which is mainly based on Internet advertising, and the cost of acquiring each new customer is 25 yuan.

In the end, customers have to try to take a step in brand marketing. "The success of every object" will make them calm down and think about the brand marketing strategy of an enterprise.

In the traditional clothing enterprises, the seven wolves have maintained a stable proportion of 7-8% advertising costs. After years of precipitation, the technique has become more and more sophisticated.

In particular, it changed the expensive CCTV annual broadcast (2, 5, 10 sets) to CCTV and local stations with selective broadcast, and with outdoor and print advertising, etc., the investment income ratio of advertising increased significantly.