Rising Passenger Costs And Difficulties In Garment Retailing

2012, China

The development of textile and garment industry will face more resistance because of fluctuations in raw materials, labor shortage, exchange rate rise, interest rate increase and deposit reserve ratio, electricity and energy pressure, environmental protection and inflation expectations.

Similarly, clothing retailing industry is also affected by factors such as rising cost and reduced passenger flow.

Brand dealer profit decreased from 200% to 20%

Zhang Jing is Herman in Suzhou.

The 5 major brands of purple Shu, Ji Pai and Xin Shi family are the general agents of clothing and several small brand clothes, and have extended their business to Huaibei. She has a certain say in Suzhou's clothing industry.

Ten years ago, Zhang Jing's first clothing store opened.

In those years, when the clothing industry was hot, everything could be sold, and her first pot of gold was also excavated at that time.

After that, Zhang Jing's clothing business grew bigger and bigger, but at the same time, she felt the pressure multiplied.

Especially in the past two years, clothing business has become a common practice. The bigger the stall, the harder it is to operate.

Zhang Jing told me that the overall economic downturn, price increases, wages did not rise, so that the purchasing power of the public decreased, resulting in a significant decline in passenger traffic, while the facade rents and wages increased the cost of clothing business rapidly increased.

Based on the calculation of Zhang Jing's rental stores in the past ten years, this year's rent is 20 times more than ten years ago, an increase of 50% over last year. The salesclerk's salary was 300 yuan per month 5 years ago. This year, the excellent shop assistant's salary level for half day class is above 2000 yuan.

Many people clearly feel that the price of clothing this year has improved, but in fact, profit margins have shrunk dramatically.

Take Zhang Jing's brand clothes as an example, profits in the past few years are generally 200%, such profit margins are really hot, but now less than 20% after all expenses are removed.

Zhang Jing said: "nowadays, the price of branded clothing is generally 55% off, before eighty percent off or seventy percent off, and the price of imported goods is much higher than that of previous years.

After the goods were brought, they could not be sold in accordance with the price. They were all discounted. It was difficult to sell without discount. Most of the products were sold at the price of 20 percent off or 10 percent off when the new products were listed.

In addition, high inventory pressure still exists.

General

Purchase is the implementation of the order system, manufacturers give a maximum of 10% return rate, can not sell and can not be pushed out of the goods can only be discounted to deal with the withdrawal of funds, then it will appear as low as 60 percent off, 50 percent off of the price, so dealers are doing a loss of business.

Despite the gloomy climate of the clothing industry, Zhang Jing's "Herman" has increased 16 times in three years, opened 3 stores, and opened a new store next month, and has expanded its business to Huaibei.

For the vigorous development of Herman, Zhang Jing, who is already well versed in fashion management, said that it is not difficult to stand out from the difficult clothing industry as long as we have an ideal and reasonable business model and excellent staff team, and when commodities are adapted to local market when investing.

{page_break}

Private clothing stores face a sharp rise in rents

2012, for individual clothing operators, it is equally hard.

Miss GUI has been doing business for four or five years in Jinmao mall. She feels quite a bit behind the fashion industry in the past few years.

"Now there are a lot of business circles for clothing. Shopping malls are everywhere, including shopping malls, Jinmao mall, Zhongshan street, Yucheng garden, city road, and Community streets.

More and more people have joined the industry, and their competitiveness has increased dramatically.

With so many people in the city, a piece of cake is divided into 10 people. Now it is necessary to divide the market share of 100 people and occupy the market share. This competition is inevitable.

For the competition in the industry, GUI Jie said that the problem is relatively easy to handle. When buying goods, we should take the right view, choose clothes that cater to the tastes of local customers, or there will be regular customer groups.

However, for the increasing operating costs, Miss GUI has nothing to do with it.

"In the past, when the business was good, it could sell 30 pieces a day, and now the guests are short, and they can sell 7 or 8 items a day, which are generally 2 or 3, and of course, there is no sales at all.

Compared with last year, profits decreased by about 50%.

Sometimes customers complain that this year's clothes are so expensive. We can't help them.

Before going to the field to purchase goods, the price of a garment was roughly several hundred yuan.

A skirt for three hundred yuan, now the purchase price is near 200 yuan, the gross profit last year is about 150 yuan, and this year we can only earn nearly 100 yuan.

For this year's clothing prices, GUI Jie has a lot of bitter water, but the purchase price increases, the retail price is bound to rise a little, for customers complain, she also has no choice.

GUI Jie said frankly, in addition to the rising stock prices and reduced passenger traffic, the rental and pfer fees are the most common headache for garment operators.

Over the past few years, the rental fee has risen and the pfer fee has gone up.

"My face is about 30 square meters. The rent 4 years ago is 20 thousand a year. Last year it was 40 thousand. This year it is 53 thousand yuan. Next year, we don't know what price it is."

According to Gui Jie, in Jinmao mall, the number of facade rooms with better terrain is up to 7-9 yuan a year. The pfer fee is low 50 thousand, high 100 thousand, rent and pfer fee one price per year, and the trend is getting stronger and stronger.

In the past, many people thought that the threshold of clothing business was low and profits were great.

But in the past two years, especially this year, the fierce competition and high cost investment in garment industry have made many garment managers who can not find the right location and play a distinctive role to be eliminated.

Comprehensive interview shows that the overall decline in domestic economy, increased competitiveness and sharp increase in operating costs are three major factors leading to the downturn in the garment industry.

In particular, the rent and pfer fees highlighted by respondents are the most serious obstacles to the development of clothing operators.

With the vigorous development of Commerce, the rents of commercial areas are constantly rising. This increased cost is bound to be made up by the increase of turnover. However, the increasingly fierce competition and the increasingly saturated market make it almost impossible for the sales of clothing stores to grow further.

For example: I learned that in Yucheng garden, a store of more than 60 square meters, the rent last year was 20 thousand and 4, and this year it suddenly rose to 60 thousand and 5. In addition, the pfer fee of 70 thousand yuan was added.

Clothing operators should invest more than ten million yuan in the early stage of opening stores, plus the cost of decoration and purchase. A clothing store will also cost nearly 300 thousand yuan.

Such a high cost of investment, operators still want to make money, and then the cost is allocated to the commodity, the retail price of the goods is raised, but customers think it is too expensive not to buy it, resulting in the clothing store can not sell, can not continue to operate, the operator has to sublet the store to another person.

This creates a vicious circle. Operators can't earn money and customers can't buy cheap goods.

In this process, there is only one beneficiary, the landlord.

Only landlords are the ones who make money forever.