Fashion Industry Enters Brand Spring

YOUNGOR (10.42, -0.28, -2.62%) group has been the leader of the men's wear industry in China.

Nowadays,

YOUNGOR group is also an enterprise research point of the prosperity index of China garment industry. Recently we went to investigate and interview the chairman of YOUNGOR group, Li Rucheng, on the development of independent clothing brands.

Brand management drives new development of industry

Brand = added value, brand = benefit, more and more domestic garment enterprises begin to focus on brand management.

The main business of YOUNGOR group is to make garments. After 30 years, it has created a vertical textile industry chain with brand clothing as the leader.

Since 2009, YOUNGOR's clothing sector has begun to undergo new changes, accelerating its pformation to brand operation.

Reporter: at present, what is the development pattern of China's garment industry? What influence or inspiration will it have on YOUNGOR's production and operation?

Li Rucheng: the domestic garment industry has a large scale and can be roughly divided into three systems.

First is foreign trade export.

This type is determined by domestic production factors and abroad.

Second, the development of domestic brand clothing.

Now the demand of consumers is relatively high, and the domestic market is very thin. Like YOUNGOR's core products, they are formal suits, shirts and business costumes. The core product of Bosideng is down garments, Semir, America and so on are the main leisure clothes, the industry is gradually differentiated and consumers are also different.

The third category is pure processing enterprises, for domestic enterprises to do processing, also do foreign trade processing, their characteristics are to solve employment and obtain small profits.

Brand clothing has great space in China, which will bring opportunities to the processing enterprises.

In view of these three development types, YOUNGOR first is right.

YOUNGOR has been making a brand name for a long time. Since its beginning in 1984, it has built its own brand "Beilun port". During the same period, it has also made some brand OEM, which has tasted great sweetness, and has seen several times of growth in recent years.

After the test of the international financial crisis in 2008, YOUNGOR paid more attention to brand building.

In 2009, we started multi brand business. Over the past two years, from the perspective of net profit, gross profit margin and industry development, the development of multi brand has achieved obvious benefits.

Now we should pay more attention to brand promotion and consciously control the speed of development.

Recently, I led the team to communicate with European enterprises, and wanted to introduce Italy's senior management team to discuss with them YOUNGOR's brand and internationalization.

These are all being explored, but the direction is basically clear.

Reporter: for brand building, there are some references in the industry. First, the era of 11.38,0.08,0.71% brand has arrived, and the two is the spring of Chinese clothing brand.

In the context of the current industrial development, which one do you think is more accurate?

Li Rucheng: when I attended the Beijing China brand promotion association in 2001, I saw a slogan: Farewell to the quality era and enter the brand era.

That is to say, after entering the twenty-first Century, China's garment industry has bid farewell to the quality era and has entered the brand era.

In fact, it is not very precise to say that "brand era is coming", because now everyone is already doing it. It is more appropriate to say "spring in brand". Spring is the season for all things to grow. China's industry has entered the initial stage of brand operation during the period of "creating brand", and the operation of brand is in the stage of germination.

On the one hand, we have a fast growing social base and strong manufacturing capability; on the other hand, the external business environment is not very standardized, and there is still a lack of design talents in related industries, and the enterprises have not put the design in the proper position. The consumer groups are not very mature. These are the factors that can not be ignored in the initial stage of the brand.

Reporter: there is a saying in the industry: "if you want to make big money in the clothing industry, you have to rely on the brand".

How to understand the importance of brand management to the development of garment industry?

Li Rucheng: there are several core elements of the brand. The first is to accurately locate the brand consumer groups.

Take YOUNGOR, there are millions of loyal consumers buying YOUNGOR products every year, so our gross profit margin is relatively high, more than 60%, and second is brand channel construction, which is also critical.

YOUNGOR has attached great importance to the construction of the domestic marketing network and has made rapid progress. Especially since the 90s of last century, the annual sales volume has grown at a speed of 90%, and its profit has doubled.

Of course, after the brand positioning is determined, there should be corresponding design team, information technology and support from the buyer system. These aspects are well done, and the vitality of the brand will be strong.

Compared with the general product, the added value of the brand product is high.

Comparing YOUNGOR with international brands, although the price of YOUNGOR is not as high as that of foreign brands, our gross margins and sales are good, so we have little difference from international brands.

Another prominent advantage is that we still have a very core industry chain.

If there is no industry chain, it will be very difficult.

There are also many clothing enterprises in China. They have created many brands, and some have registered in places such as Italy, but their products are basically identical.

YOUNGOR is different, because it has a solid foundation and has its own industrial chain to support it. YOUNGOR has its own characteristics and its own cultural connotations.

I think, with the continuous development of economy and industry, the effect of brand will be reflected more and more.

Reporter: as you mentioned just now, YOUNGOR's gross profit rate can reach more than 60%. This is a very high data. Do you mean the gross profit margin of brand clothing?

Li Rucheng: Overall, the gross profit margin of YOUNGOR brand clothing is still good, and the shirt can reach 70%.

To see YOUNGOR's data, we should have confidence in China's clothing industry.

YOUNGOR is not the top brand. Like our high-end brand, there are more than 60% gross profit margins, 30% more sales profit margins, 25% net profit after tax, and 30% capital return. These data have shown that clothing is still an excellent industry.

Brand reengineering is an arduous process.

YOUNGOR implements multi brand strategy to deal with the market demand. "Brand change six" aims to form the effect of "all stars and win the moon".

This also means that YOUNGOR has embarked on a complex brand reengineering from simple brand building. The company is facing the situation of different product content, diverse plates, varieties of surface accessories and diversified processes.

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Reporter: in the past, YOUNGOR has only one brand. Since 2009, the implementation of multi brand strategy is based on what kind of consideration?

Li Rucheng: we do not need to make every brand bigger, but we need to refine the consumption group, divert the management personnel, and form a certain competition among them. Finally, like the POLO of the US, there are many brands, but only POLO does the best. Others are just creativity and concepts.

Brand depends on accumulation. The greater the brand effect, the greater the brand itself.

It is common to say that because we have a deeper understanding of brand, advertising expenses can be omitted.

YOUNGOR's 6 brands (namely, YOUNGOR, GY, MAYOR, Hart Schaffner Marx, CEO, hemp family), other brands do well, YOUNGOR (YOUNGOR) can not produce advertising, because its own consumer loyalty will be strengthened, do not use additional publicity and promotion.

Over the years, we have been trying to make YOUNGOR bigger, and the other brands are "stars", aiming to brighten up YOUNGOR's "Moon".

Reporter: specifically, what kind of relationship is there between the 6 brands?

Li Rucheng: the original YOUNGOR brand positioning is relatively wide, and later we gradually refined it: launched the GY, aimed at the younger group, and launched the MAYOR, which is a relatively executive and relatively high-end brand, highlighting the classic and high-end style in terms of product functionality and details; YOUNGOR is the classic brand of YOUNGOR, emphasizing the design and processing of men's clothing with high quality and high style.

The YOUNGOR is split into three, which makes it easier to focus on the target consumer group, and at the same time, let the brand develop in the direction of high-end and younger.

In addition, we also introduced the Hart Schaffner Marx of the United States, and another CEO purchased after the acquisition of the new Malaysia Malaysia brand. The brand has begun to try online sales and has achieved good results.

Another is the hemp family, using hemp new material, we expect to advocate a new way of life by the whole brand concept of hemp family.

In our view, making a brand is not as easy as raising a child. As long as you eat and wear, you can grow up. You need to continuously invest in the development of the brand, and you need to cultivate relevant talents. This is a difficult and complicated process.

Reporter: is the establishment of a brand studio enough to make these sub brands well? How exactly does it work?

Li Rucheng: intensive cultivation in the clothing industry has always been valued by YOUNGOR.

The establishment of brand studio is also a way to pform our marketing methods and from production to brand.

Through a period of operation practice, brand studios are constantly promoting the process reengineering and optimization of brand operation, and have initially formed the development mode of independent design, shared procurement, logistics and channel resources, basically realizing the pformation from quantity expansion to brand promotion.

At present, the brand studio is pitional, conditional studios should gradually become independent business units, independent accounting, economic accounts, can not eat big pot.

To some extent, multi brand strategy may bring an organizational change to YOUNGOR.

Reporter: is YOUNGOR's goal to create a well-known international brand?

Li Rucheng: we are working hard for this.

At present, it is more difficult to make YOUNGOR brand into the international market. Therefore, we want to use YOUNGOR's strong capital to acquire world brands and speed up our own development. This is also a direction to guide the brand to internationalize.

Since the successful acquisition of the US New Malaysia company in 2008, we have made relatively rapid progress in the construction of international channels, laying the foundation for the next step to enter the international market of YOUNGOR brand, and also have accumulated some experience for us to expand our main business through mergers and acquisitions.

Speed up promotion in cooperation with major international brands

What is the difference between China's clothing brand and what is learned from international famous brands? This is the same problem that YOUNGOR faces in the international market.

Compared with international brands, Chinese clothing brands have their own personality and experience.

Nowadays, Chinese brands are marching towards world brands, shortening the brand gap on the premise of guaranteeing quality, just as YOUNGOR's goal is to create an international brand and build a century old enterprise.

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Reporter: how do international peers view China's brand? What do you think of YOUNGOR?

Li Rucheng: many international colleagues are very jealous of Chinese brands.

The reason is that China's garment industry is not only a large market that is growing, but also has a bright future.

Comparatively speaking, China's garment industry still has the advantage of labor force, and its operation space is relatively large.

YOUNGOR is also doing some big international OEM, and in the high-level conversations with these brands, they joked that YOUNGOR is "begging for food on the gold mine", which means that we have a complete industrial chain, but we still do some OEM besides our own brand management.

In recent years, the international apparel industry is concerned about YOUNGOR, and a number of high-end brand heavyweights are studying YOUNGOR. They think YOUNGOR has fully qualified for international development, and there is much room for improvement.

Reporter: you mentioned that YOUNGOR has many exchanges with European and American counterparts. What do you think is the difference between Chinese clothing and international clothing? Is it production technology or brand?

Li Rucheng: in terms of production and manufacturing, there is not much difference between the two countries.

Foreign counterparts in the quality, processing, fabrics and other aspects are very recognized us.

In terms of design, they have their own set of ideas and will create different ideas to dominate consumption. We can only follow their ideas, after all, the consumption culture is different.

More than ten years ago, I would buy a lot of samples from abroad. Now it is more and more difficult to buy samples, because I feel that our products are not inferior to them. This shows that our distance is getting smaller and smaller.

But at the same time, some famous international garment enterprises are doing better than us in terms of information technology, design team and marketing personnel. This is the main difference.

For example, the new type of marketing "buyer system", the buyer is not only a fashion trend of the forefront of the profession, but also a consumer and brand, and bring business changes to the business.

Buyers come and go all over the world, always pay attention to the latest popular information, grasp the trend of fashion and hold large quantities of orders.

This profession needs to integrate art knowledge, market forecast, brand positioning, data analysis and other multidisciplinary knowledge. Besides, it is very important that buyers need to be a person who knows how to operate.

But at present, the domestic high-end buyers are still scarce.

Reporter: if the domestic textile and garment enterprises want to build big brands, what is the most lacking compared with the big brands in the world?

Li Rucheng: one is cultural accumulation, the other is technological force.

In addition, there is still a gap in our technological environment.

In China, many enterprises need to expand and pursue a volume expansion.

But in Italy, many small and medium-sized enterprises have their own technical characteristics or product characteristics, so that their products are more abundant, and we are more likely to be identical.

In addition, this phenomenon is also related to consumer groups. Foreign consumers are willing to pay high prices to buy personalized things, but Chinese consumers are more demanding price advantage.

Reporter: many famous international clothing brands have also experienced ups and downs. What will these processes bring to the domestic garment industry and YOUNGOR itself?

Li Rucheng: the current situation is that as the market becomes more and more mature, the international luxury brands are going down, so these brands begin to rely on some vice brands to make profits and make the brand influence.

The clothing industry is becoming more and more powerful, and more and more brands and enterprises are competing. Now it is the "spring" of the brand, and then it will enter "summer" and "autumn", that is, prosperity and maturity.

The maturity of a brand needs a process of growth, which requires efforts from one generation to two generations or even more generations.

In addition, brand is not an isolated industry, it is closely related to the development of the whole society.

Good economic development and strong consumption power will have a positive effect on brand.

The construction of brand can not be encouraged. It is impossible to produce a number of big international brands.

This will be a long-term accumulation process, a precipitation of culture, and an inevitable outcome of economic development.

From production marketing to brand operation

In the industry environment of creating and operating brands, the advantages of the complete industrial chain can be described as the cornerstone of YOUNGOR's brand establishment. On this basis, more attention should be paid to product design and increased investment in design and brand. These measures will accelerate YOUNGOR's pformation from production and marketing to brand operation.

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Reporter: you mentioned that the industrial chain is the core of YOUNGOR's outstanding advantages. Why did YOUNGOR choose to develop the whole industry chain through the upstream and downstream, instead of "putting on the brink and making the brand"?

Li Rucheng: at present, some domestic garment enterprises follow the example of Europe and America, and have made rapid growth in light assets operation. They have no production links. The assets and management capabilities of the company are mainly concentrated in the field of product design and marketing.

And YOUNGOR's advantages are concentrated in the field of processing and production. From the beginning of cotton cultivation to the last channel construction, a complete industrial chain has been formed.

First of all, YOUNGOR has different development paths with European enterprises, or rather different stages of development.

European enterprises also began to shift the manufacturing industry from the beginning of the importance of manufacturing to a certain stage, and made use of relatively cheap labor resources and land resources to make light assets operation in their country.

From the present point of view, the development of YOUNGOR in information and internationalization is still lagging behind in Europe and the United States, so we should continue to adhere to our whole industry chain.

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In the past 30 years, YOUNGOR has attached great importance to product quality and upgrading of the upstream and downstream industries. We believe that good products must have good raw materials, good fabrics, and establish their own sales channels. In the past 30 years, we have made a lot of efforts and explorations.

Looking at the European and American enterprises, they are also carrying out asset repurchase and taking the road of the industrial chain.

In the final analysis, brand competition is ultimately the competition of the industrial chain, not just the contest of light assets.

The construction of YOUNGOR's industrial chain has been effective, and we will continue to make our industrial chain stronger and better.

Reporter: there is a saying that the clothing industry is China's most likely to produce international brand industry, how do you see it?

Li Rucheng: brand involves channels. It is very difficult to establish channels in the world.

The brand culture representing the world's advanced level will be recognized internationally.

There are also positive evaluations of Chinese brands, but they are polite.

Because the brand represents the trend of life and represents the direction. Chinese brands should enter the world brand, not a matter of enterprises, but also a matter of the whole industry and even the country.

Reporter: from your point of view, what will be the pattern of the domestic garment industry in the next 5 to 10 years?

Li Rucheng: China's clothing brand is still in the "spring" stage.

What is the concept of spring? That is, brands sprang up like mushrooms, and everyone is making brands. This is a big background.

At present, it is hard to see big monopoly in the industry. The society is developing, and brands are springing up and competing with each other. It is hard to say which brands can finally stand up.

Brand construction is inseparable from consciousness, design, creativity, industrial manufacturing and even raw material planting. It is a complete industrial chain. We need not only the relevant policies to truly foster the growth of the brand, but also the industry and enterprises to work hard to manage the brand.

In addition, brand growth also needs a better external environment. Media publicity and consumer recognition are very helpful to brand development.

For example, we can increase publicity so that consumers can understand the direction of the growth and future development of the domestic garment industry. We will gradually identify with China's brand culture and let consumers know that China's brand has the highest cost performance and the most practical.

For YOUNGOR, pformation and upgrading are still important.

In order to seek development in pformation, the key is to turn the big factory into an artistic world created by creativity.