Why Is The Price High? Why Is Domestic Brand Clothing Unattainable?

In the United States for a period of time, Hui Zi introduced: "the middle and top grade garments in the United States are much cheaper than in China, and they are bought in the United States.

Clothing in department stores in China

The pain of garment enterprises

Some clothing enterprises say: the high price of clothing in the shopping mall is not their original intention, it is the various fees charged by the shopping malls, forcing enterprises to increase their prices and sell clothes.

A person in charge of the brand introduces that after the product is made, it is priced by the clothing enterprise itself.

Enterprises like them are generally priced at 3-4 times the cost and 4-5 times larger brands.

Why should it be so high? He said, every season's style has both popular and unsalable funds, and the pricing strategy must be able to deal with "before making profits."

The late sale can only be sold at 1-3 discount, which needs to be filled at a high price in the early stage.

Since the price is 3-4 times the cost, should the garment enterprises earn a lot of profits?

The responsible person calculated a detailed account: first, the store should deduct 25 percentage points from the clothing category, that is, the supplier will sell 100 yuan for each store, and the shopping center will get a 25 yuan fee.

Secondly, the mall will deduct 2 percentage points of advertising fees.

Also, the mall and the supplier have to sign a contract for the bottom sale. The part that has not been completed will be paid by the supplier himself, and the store will be rented at 25 percentage points.

In addition, every big holiday, the mall will launch a larger promotional activities, will eventually be passed on to suppliers.

He also said that after deducting rent, assessment fees, taxes, etc., the mall sold 100 yuan each, suppliers can get 65 yuan is also good.

"And now, the cost of raw materials and the wages of shop workers are increasing year by year. We can only raise the price of clothing."

In short, a brand usually has to enter the shopping mall. Clothing suppliers first pay the entry fee, which mainly includes dozens of names such as posters, promotional fees, default fees, storage fees, advertising fees and so on.

Many clothing counters are required to take part in all kinds of discount activities held in the shopping mall all year round, and accept preferential discounts for members of the mall. This means that clothing companies must reserve corresponding price space when pricing.

All the money was made by the mall?

Is the shopping mall as much as the clothing companies say it charges too much? Zuo Houming, general manager of Limited by Share Ltd West feather company, Xidan shopping mall, Beijing, said: "I am only responsible for the down jacket. For the down garment brand that is stationed in Xidan, we are still using the charging standard used a few years ago. Besides collecting a fixed fee, there is no disguised charge for the extra cost.

The cost has not gone up, but it has a downward trend in the recent period.

But now the operation cost of shopping malls is indeed increasing.

First, the cost of energy has been raised; secondly, the retail industry in recent two years has been very competitive. Like Beijing and Shanghai, there are new shopping malls open every quarter, and each of them is digging up talents. The cost of manpower is rising. In order to maintain a good shopping environment to attract tourists, shopping malls often need to be repaired and maintained. This part of the cost is also rising.

For this, Zuo Houming said: "renovation, decoration and other expenses need to be stationed by enterprises or brand agents to deliver, but not much."

For promotional activities or discount season, Zuo Houming said: "we do not stipulate that all brands are discounted during the promotional period, so long as they are self processing according to their own actual conditions, and during the promotion period, we will give profits to enterprises. For example, we usually charge 20 deductions (that is, the business operation of shopping malls), and during the promotion period, we will give profits to 5 enterprises."

Clothing companies and department stores insist on each other.

But the price of clothing is really high. Why?

Long chains, high prices.

According to the insiders, the current department stores generally have higher rates of deduction, long account periods, promotion costs and other unspoken rules and so on. Therefore, clothing prices are also high, and clothing has gone through many links and layers of agents from the factory production to the shopping mall (the common process is: clothing manufacturers - General Agents - regional agents - distributors - shopping malls), which directly lead to the final retail price of goods that consumers are facing.

Sun Ruizhe, vice president of the China Textile Industry Association, said that many goods in China's department stores are much better than those in European and American department stores. The high prices of commodities have largely inhibited the consumption demand of the residents.

Western retail industry adopts its own brand strategy, which is the combination of retailing and manufacturing, the superposition of commercial brand and commodity brand, and the vertically integrated management of design, manufacture and sales, so as to minimize the cost and optimize the channel, so that consumers can buy goods with good quality and low price.

China's retail industry adopts the business mode of joint operation, factory entry and collection of various "entry fees". It relies on sales rebates, extension of accounts and collection of "entry fees" as the main source of profits, resulting in high price.

Zheng Siming, a senior consultant in the clothing industry who had done a lot of research on China's department stores, told our reporter that there is a certain gap between the price of clothing at home and abroad and that there may be some differences in clothing materials and labor costs in different regions.

But he said: "department stores must build a supplier and retailer collaborative production and marketing value chain system."

At present, China's suppliers are multi-level, multi-agent, and their commodity distribution costs are as high as 25%.

Foreign advanced department stores reduce the distribution cost by integrating supply chain.

For example, clothing retailer GAP, by improving collaboration with factories in the Pacific region, will store more than 40% of its merchandise before the distribution center, and Kohl 's department store will achieve more than 40% direct operation through cooperation with the national brand and its own brand suppliers, reducing the cost of the distribution center.

Many foreign department stores have their own commodity brands, and 70% of Sears stores in the United States own their own brands, which has become the core of their success.

Owning own brand can not only keep the consistency of stores brand, but also reduce the cost of procurement, and also solve the problem of brand choice being restricted by supplier channels.

Zheng Siming said: "these are worth drawing lessons from domestic department stores."

In addition, he also said: "department stores must change the business mentality of" importing factories into stores "and making" two landlords ". Besides organizing" buyers "teams, and vigorously introducing famous brands both at home and abroad, they must also build their own brand supplier alliance and licensed commodity system.

With the rising cost of clothing, the department store industry has come to an urgent need to change, and vigorously developing its own brand is the future trend.

At the same time, as far as possible to reduce the cost of the channel and give profits to consumers, the new business model with this direction will have greater prospects for development.

Different domestic and foreign circulation channels have resulted in different prices, and also caused domestic consumers to assume the role of "ultimately paying".

Consumers' overpaying costs do not show that the clothing industry is a profiteering industry, but there are so many stakeholders under the existing department store mode that consumers have to pay for the cumbersome circulation channels.

Consumers pay more for that part, which is feeding a chain that perhaps should not exist.

Now, the price of raw materials and the wages of workers are rising. The "hard cost" has been raised again and again. Is it all pushed to consumers? The pformation and innovation of commercial channels is imperative.

China's department stores may be able to take advantage of this "raw material war" to carry out a channel change so that consumers can lighten their load.