Textile And Garment Enterprises: Industrial Integration And Extension Value Chain

For traditional textile manufacturing enterprises, the road of pformation can be divided into two types: first, the rapid extension of M & A to the downstream, and the two is to strengthen the technological development and take the road of specialization.

Most of China's textile industry only takes up the simple link of manufacturing and manufacturing.

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From China's per capita clothing consumption and the growth potential of consumption brought by the urbanization rate, China's clothing

In the clothing industry chain, there are not many enterprises with the whole industry chain. According to the difference in the position of the chain and the participation of each link, the participation enterprises in the garment industry can be divided into three types: the traditional brand manufacturers, the traditional clothing retailers and the comprehensive clothing public (private brand retailers).

For garment enterprises engaged in export processing trade, the choice of brand manufacturers can bring the original production advantages into the new brand.

When enterprises gradually grasp the skills of brand operation and expand the scale of sales, they can begin to consider outsourcing some production, and expand the control of terminal stores through upgrading the proportion of Direct stores, and begin to shift to private brand retailers.

From the experience of successful brand operation in China, the representative enterprises, such as Smith Barney, and the seven wolves, all adopt the mode of production + wholesale. When the scale of business is enlarged and the market is mature, the production will be outsourced, mainly attacking design and sales.

When the mode of wholesale growth is slightly weak, more energy should be invested in Building Direct stores, enhancing interaction with the market and gradually changing to retailers.

At present, most of the brand enterprises entering the last stage are still in the process of groping. The experience of terminal management and brand marketing is still in a relatively primary state.

At present, the leading brands in the market are manufacturers' brands, and these brands are also gradually changing to the role of retailers, such as the seven wolves in the 2010 annual report that they should pform from "wholesale" enterprises to "retail" enterprises.

The downward extension of the industrial chain can enable garment enterprises to gain more market dominance and to return the profits originally pferred to the agents, which is conducive to maintaining the long-term and stable development of enterprises. This is a trend for the development of the garment industry in the future.

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Two pformation paths

China's textile exports have strong technical advantages, and the industrial clusters in Guangdong, Jiangsu, Fujian, Shandong and other large export provinces have significant effects, and the industrial chain has a complete set of upstream and downstream. These have set the foundation for China's textile exports relative to emerging markets such as India, Vietnam, Bangladesh, Kampuchea and other regions. However, the impact of inflation, labor costs and RMB appreciation on prices can not be ignored, and the textile industry in the emerging market is accelerating. For example, India is strengthening investment and increasing investment in the textile industry.

Now it is not just foreign brands, even Chinese brands such as Smith Barney, are also considering shifting some of their production links to emerging markets.

We can see that the rise of emerging markets should not be underestimated.

In the long run, China's low cost competitive advantage will gradually weaken, and Chinese textile enterprises will also face greater pressure of pformation.

For traditional textile manufacturing enterprises, the road of pformation can be divided into two types: first, the rapid extension of M & A to the downstream, and the two is to strengthen the technological development and take the road of specialization.

For the first, Shandong Ruyi group provides a good example.

In June last year, Ruyi Group invested about $44 million to acquire Renown 41.53% of Japanese famous garment enterprises. In September this year, ITO, Japan, was introduced into its shareholders to expand its international trade and promote the internationalization of the group.

As Qiu Yafu, chairman of Ruyi group, said, "the core competitiveness of Ruyi group is to rapidly expand itself through large-scale acquisitions and mergers and acquisitions of large scale enterprises".

For the second ways to enhance the competitive advantage of products, Huafu color spinning and Jialin Jie can be regarded as models.

Huafu color spinning has increased market share through increasing product technology content, developing new varieties, purchasing capacity, and so on.

Jia Linjie is technically the leading supplier in China and has become a designated supplier of fabrics for many international brands. At the same time, the company is also working with foreign partners to develop new fabric varieties.