Humen Clothing Is Also Facing High Inventory Orders Will Be Late Weakness.

Known as the "dead end" inventory of clothing industry, this summer has once again become the shadow of fashion entrepreneurs' minds.

A few days ago, the Internet was widely rumored that the leading enterprises in the United States and the United States were huge inventories and even burst.

And Semir, Hai Lan home, and so on, most clothing enterprises are facing high inventory pressure.

Garment enterprises are also facing the same problem.

The great challenge.

Ouyang Guangyao, executive director of China Southern apparel industry alliance, told reporters that according to the normal operation of the industry, 10% to 20% of the scope was regarded as safe stock, but most SMEs in Humen often exceeded the 10% to 20% warning line.

"Many brands of clothing are usually open in autumn and winter in March.

In August, the order will be held in spring and summer, but many enterprises in Humen will often have orders 2 months later than their counterparts.

Chen Yue, senior industry insider, said that the order will be 2 months late, which has become a fatal weakness for most small and medium-sized clothing enterprises in Humen to generate high inventory.

High inventory

Manager Yang is a professional manager of a women's clothing company in Humen.

In May 25th, the reporter came to Yang manager's business headquarters in Humen Town mouth.

The season of Dongguan is already summer, but the factory is entering the hot autumn and winter clothing production.

"Just after the autumn and winter clothing orders, new products must be driven out in July."

Yang told reporters that orders for customers this year were less than that of the same period last year, but at the order meeting, the company increased customer orders by communicating with customers.

So now the factory is busy producing new products by July.

Yang told reporters that according to the order demand of the autumn and winter orders, the company's order amount was 10 million yuan, but taking into account the possible increase in demand and stocking situation, the boss of this company still increased production and increased production by 30%.

This means that new growth must be digested by old customers by opening new stores or increasing sales performance.

It is this increasing capacity that led to Mr. Yang's factory still having inventory in spring and summer last year or even in 2010.

"When we make inventory turnover plans, we generally expand demand.

For example, retailers think that 150 pieces are needed, and agents think they need 200 units, and 250 items are extended to the manufacturers. That is to say, every 1 items sold, producers should prepare at least 2.5 items for inventory turnover, sometimes exceeding this proportion, thus forming a large quantity of stock.

Manager Yang said helplessly.

Similarly, even the famous clothing company in Dongguan has found a similar inventory dilemma.

According to the group's report, inventories in 2011 increased by 1.4 times compared with previous sales expansion, and inventory turnover reached 123 days, which is 1.5 times that of Semir.

In the first quarter of 2012, the company sold some of its off-season products to franchisees in the first quarter, resulting in a 4 percentage point decrease in gross profit margin.

"Inventory pressure is big, the situation is grim."

Ouyang Guangyao said, according to the normal operation of the industry, 10% to 20% of the scope is regarded as safe stock, but most SMEs in Humen often exceed 10% to 20% of the warning line.

Orders will be slow.

Manager Yang also knows that high storage is like a chronic "suicide" for enterprises, but with the rising cost of enterprises, only continuous expansion can maintain the expenses and make profits.

But often because of this quick success and instant benefit, many enterprises are faced with high storage difficulties.

For Humen, a more special reason has even overwhelmed many small and medium-sized garment enterprises.

"Many brands of clothing are held every year in autumn and winter in March, and the next spring and summer order will be held in August, but the order in Humen will always be 2 months late."

Chen Yue, general manager of Dongguan sole snake clothing Limited company, said that because the clothing enterprises in Humen are mostly small and medium-sized enterprises, they often need to strictly control costs in R & D and design talents.

This leads enterprises to start designing new models, large samples and making editions after the beginning of the year. The new style is already made in May.

Orders in May will take orders, and at least July will bring new products to market.

It is this precious 2 month time difference that leads to high inventory and even difficulty in operation.

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However, for small and medium-sized enterprises, 2 months of time lag is also helpless.

"The top designers are in Beijing, Shenzhen and other places, and their own R & D design is not enough, and the new time is delayed.

If we increase R & D team and market demand is unstable, adding too many R & D talents means increasing costs. "

An unnamed clothing boss said that in the current market situation, whether it is to expand the R & D team or stabilize the market first is a tangled choice.

Seeking for diversification breakthrough

Dongguan downer Clothing Co., Ltd. has also experienced inventory pressure, but the company made a decision last year to invest heavily in R & D design team to expand its R & D capability and improve the new R & D speed, so that the order time will be 2 months ahead of schedule, consistent with the first-line brand.

"This means that our new product launch time and brand clothing at the same time, enhance the competitiveness of the market."

Chen Yue said.

Not only that, the clothing of single snake also makes a systematic analysis of the actual sales ability of customers.

"How did the client last year's performance? In the light of market development, could he open new stores this year and increase sales?

We all need to make great efforts to analyze rather than expand blindly.

In the control of the channel, the single snake clothing is now shrinking its front line of women's wear shop and expanding it to the field of e-commerce.

Chen Yue told reporters that the competition of women's clothing market in China has become more and more intense, and the volatility of the market is also large. This is obviously a great challenge to the inventory control of garment enterprises.

E-commerce channels can be more direct and rational analysis of the needs of the most advanced consumers, and the risk of inventory is much smaller.

However, e-commerce has put forward higher requirements for the response speed of the supply chain.

Dongguan Yi Mi seven Clothing Co., Ltd., formerly known as Dongguan IMI seven garment factory.

Initially, the company also engaged in a variety of women's clothing production and sales, but also encountered inventory confusion.

However, now, IMI seven has adjusted its product line to produce Korean version of clothing and mainly e-commerce channels.

"E-commerce needs consumers in a timely manner, and many styles of Korean clothing are of equal size, so the inventory is small."

Miss Yang, general manager of Imai seven, said.

However, for most small and medium-sized clothing enterprises in Humen, facing the challenge of high inventory, it is still a stumbling block for them to go ahead in the future.

Subdividing garment structure proportion to reduce stock

The average gross profit margin of the garment industry is generally 20%, even if there is no inventory, minus 10% of the cost, the remaining profit is only about 10%.

Insiders said that now that there is inventory, profits may be further reduced to 6%, if the average 50 percent off sold, the final profit will be very poor, if the stock is bigger, it may even be zero profit.

That's why clothing companies make a lot of money in a year's hard work.

It can be said that whoever solves the inventory problem becomes the master of the channel.

Effective control of clothing inventory, ordering is the first element. Analyzing the real needs of downstream customers is the first step.

How do we analyze the actual needs of customers? Chen Yue believes that clothing enterprises must conduct a systematic analysis of their customers. "Can the sales of customers last year compare with the situation this year, can they have new orders? Are there any new changes in the competition situation around the customers?" Chen said that enterprises must understand the market in the early stage, and even invite professional teams to do market analysis instead of increasing production volume and expanding production according to the order quantity.

"The research and development of new clothing products must be guided by the market and not blindly follow suit."

Ouyang Guangyao suggested that after the new version of the clothing came out, the company should actively invite customers with high quality channels to convene a new version.

Because these high-quality channels are most familiar with the market frontline situation, so that the enterprises can determine the proportion of different styles of clothing subdivision structure and reduce the risk of unsalable products after listing.