CEO Ji Wenhong: Luxury Electronics Business Pformation &Nbsp; Let Buyers Turn To Consignment Negotiations

Ji Wenhong CEO

The near future,

"Two years ago, we realized that there is no future in selling luxury goods. On the one hand, the supply of luxury goods is not enough for most websites. On the other hand, the proportion of users buying online luxury goods is very low. Therefore, we started to pform very early."

Ji Wenhong, CEO, told reporters that in last year's sales of nearly one billion yuan, luxury goods accounted for only 15% of the total sales, and more and more international fashion brands. The average price of five hundred or six hundred yuan per passenger price was also in line with the high-end positioning of the network.

In addition, the overseas fashion buyer system, which has been adhered to by Xiu Xiu net, has made it possible to kill the siege in the winter of luxury electric business.

Innovation: fashion buyer as the core competitiveness

With interest in e-commerce, Luo Qiliang entered the "walking net" and became a group of people who tagged "what is fashion" for Xiu Xiu net.

Ji Wenhong spent the first 10 years of his career in international trade. At that time, he often travelled between overseas and the mainland, and he came into contact with many overseas brands.

"I see a lot of overseas brands are very competitive, cost-effective, and also very suitable for the Chinese market, but unfortunately there is no channel to enter the Chinese market.

I hope to build a bridge to bring these international brands to China, and to enter efficiently, without the need for distribution and agency at all levels. "

Ji Wenhong said.

The rise of e-commerce has enabled Ji Wen Hong to find the most efficient and lowest cost channel.

So he decided to become an e-commerce website that specializes in selling internationally renowned fashion clothes and articles.

In order to build up the image of high-end B2C website faster, let consumers quickly understand what kind of website the walking show is, and at the initial stage of the company's development, they are the main location of luxury goods.

Ji Wenhong, who has been engaged in international trade for many years, knows that the concept of "luxury website" is easy, but it is very difficult to run well.

The biggest problem is the supply of goods. It is hard to find a stable source of luxury goods.

Most luxury discount websites in China rely on those who often go abroad to buy part time resources, and the source of goods is very unstable. This is also the reason why domestic luxury websites are unstable and difficult to form scale.

From the very beginning, the "buy out system" was taken as an important core strategy of the company.

Ji Wenhong said that at the beginning of the website, almost all the money and energy had been smashed into the supply chain of Ru Xiu network. One of the big shots was the establishment of a fashion buyer office in more than 10 countries and cities around the world.

In 2009, Luo Qiliang, a 37 year old Hongkong man, received a call from a headhunter and invited him to join the show as a full-time buyer.

Luo Qiliang was the head of women's clothing and cosmetics department of New Yaohan in Macao. He had nearly 20 years of experience in retail industry, and was responsible for the management and procurement of brands such as Polo Ralph Lauren and Gucci.

With interest in e-commerce, Luo Qiliang entered the "walking net" and became a group of people who tagged "what is fashion" for Xiu Xiu net.

In the show network, there are nearly 20 buyers like Luo Qiliang, who are distributed in different cities in ten countries such as New York, Paris, Hongkong and Tokyo.

Unlike other luxury goods websites, which are the main discount products for the past season, the proportion of new products in the show network can reach more than 60%.

"It is precisely because of the establishment of a relatively sophisticated overseas buyer network at the early stage that the quality of the brand merchandise is guaranteed, and the quantity and arrival cycle of the goods are guaranteed, so that the global fashion goods can be delivered to the Chinese consumers at the first time."

Mu Qing, senior vice president of the network.

Micro perspective

Transformation: let buyers turn from procurement to consignment negotiations

ChinaVenture, senior analyst at Wan Zhong Group, Vanguard

The potential consumption potential of China's consumer market makes the market prospect of e-commerce websites generally favored by investors. In addition, the successful listing of e-commerce websites such as Mcglaughlin and Dangdang net has made the investment institutions get generous returns, and has also increased PE's investment in e-commerce websites.

From the perspective of development prospects, supply chain resources, commodity differentiation and services, the network has taken the lead in the industry.

In addition, the consumption share of China's luxury consumption in the world is soaring. Foreign institutions are also generally optimistic about the development prospects of China's fashion e-business field. The B round of financing of the Internet company can get the $100 million of Huaping's financing, which is enough to illustrate this point.

Internet veteran dignified

In the supply chain integration process, the show network has been working in purchasing offices around the world and working with major retailers around the world to cooperate with international brands in the way of buyers and buyout, and to introduce commodities suitable for Chinese consumer groups to the Chinese market. In e-commerce strategy, taking the online shopping mall, group buying, Outlets and other different strategies and means, the SOS network has constructed a three dimensional cross network sales system to satisfy consumers with different consumption habits.

At present, the network is at the stage of business expansion, the establishment and expansion of overseas offices, the construction of warehousing and logistics system are all in the investment stage, and the number of employees is also increasing. Therefore, cost control and sales performance improvement are the most challenging tasks facing them.

In the past, Xiu Xiu net mainly relied on the purchase of buyers, which needed more cost to purchase goods in the early stage, and the proportion of consignments continued to rise.

Ji Wenhong realized a long time ago that luxury websites only sell luxuries. There is no future for them. Although fashion buyers from all over the world can bring a stable source of goods to the website, the purchase mode and the input of websites are relatively large, which restricts the development speed of the company.

Since 2011, the company has vigorously promoted international fashion brands. Compared with luxury goods, these European and American fashion brands are more likely to be accepted.

And the development direction of expanding international fashion brands is also inevitable.

In the past, Xiu Xiu net mainly relied on the purchase of buyers, which needed more cost to purchase goods in the early stage, and the proportion of consignments continued to rise.

"In fact, it is very prudent for international big brands to choose e-commerce partners. They will do detailed investigation and assessment before they cooperate. They will be more critical about the environment of the warehouse and the cooperation team, and then they will work out the rules of the game together."

Mou Qing told reporters that the price of the middle and high-end positioning and the annual sales income of the five hundred or six hundred yuan in the show network were nearly one billion yuan, making it difficult for these overseas brands to refuse.

Ji Wenhong told reporters that in the stage of the small scale of the Xiu Xiu network, the purchase system was designed to avoid inventory and reduce operating costs, and had strict control over the quantity and style of the goods. After talking with the suppliers about the consignment system, they could put all the commodity goods of their partners in domestic warehouses or in American rental warehouses, and the goods were much richer than before.

In the first 2 months of 2012, the new network signed dozens of international fashion brands, and used exclusive buyout to cooperate with each other.

For example, in Japan, the top number of famous mail order brands IMAGE, whose competitive brands are mainly fast fashion brands such as H&M and ZARA.

After learning about the situation of IMAGE, the representatives of the company took a lot of visits to the network. They did detailed surveys from warehouse, logistics to the group and online shopping crowd, and finally chose to cooperate with the network.

Almost all European and American brands want to raise prices when they enter China, but they will try to avoid the price of international brands in negotiations.

"We keep telling each other that we should not be too expensive to make small profits but quick turnover."

Ji Wenhong told reporters that at present, the network's daily visits are about 350 thousand to 400 thousand, but the conversion rate is only about 1.8%. This shows that consumers are still very sensitive to prices. Therefore, the types and pricing of products are very important, providing consumers with competitive prices, which is also very important for luxury websites.

At the same time, the buyer system is also undergoing pformation.

In the past, buyers were only concerned about the latest fashion trends, products and information, and more in the procurement process. Now, buyers are turning to business negotiations and business cooperation to discuss the consignment mode with local suppliers.

In this way, the work content of the buyer has changed a lot. Business negotiations, delivery and replenishment, brand management and customer communication all need to be personally responsible.