Clothing Enterprises Encounter Inventory Crisis, Discount Sales Promotion Is Difficult To Cure

From the beginning of the year to now, Nanjing Discounts and special sales have not stopped at major stores. "Many brands are basically sold on the counter." One industry insider said. Not long ago, a brokerage analyst told the media that high inventory has become a bottleneck for the development of domestic garment enterprises. The impact from the international fast selling brand and the pressure from foreign trade enterprises on domestic sales are the reasons for the high inventory of domestic garment enterprises.

　　 High inventory is a common phenomenon.

The problem of high inventory in clothing industry has existed for a long time. Take Mester banner as an example, it is the mainland's first brand to learn ZARA's "fast fashion" brand, but it also can not escape the stock growth faster than the growth rate of sales. In the first quarter of 2010, the US stock was only 700 million yuan; in the first quarter of 2011, the US federal state's inventory reached 3 billion 160 million yuan, rising by more than 300%. Although there was a slight improvement in the first quarter of this year, there was still 2 billion 300 million yuan in inventory and a turnover of 2 billion 600 million yuan, accounting for more than 88% of the total revenue. According to the broker's report, the new stock in spring and summer in 2012 was about 250 million yuan, and the stock in autumn and winter in 2011 was 700 million yuan, which can be regarded as normal operation stock, but the rest can be regarded as the over season commodity. In 2011, the net assets of Mester's Bank were 4 billion 130 million yuan, which was over the end of the first quarter of 2012. clothing Inventory accounts for about 30% of its net assets.

　　 IPO of garment enterprises crashed

Because of the high cost of storage, the risk of capital chain breaking is even higher, which to a certain extent makes the market question its operational capability. In recent years, many garment enterprises in China have been competing for IPO, but they are not very few. The problem of franchisee management and high inventory and unsalable sales brought by the rapid expansion of the early stage channels has become more and more obvious, which has become the biggest inducement of IPO.

Vigna S, the local brand of Nanjing, mentioned in the first prospectus that as of December 31, 2010, Vigna S had a larger share of inventory, accounting for 101 million yuan, accounting for 63.09% of current assets and 43.74% of total assets. Among them, the inventory of goods was 75 million 44 thousand and 600 yuan, accounting for 74.32% of the total inventory. All of this shows that as market competition intensifies, wignna stock backlog is becoming more and more serious, and the market can not digest its rapidly growing stock. Once the inventory management is not good, the inventory impairment will be adversely affected by changes in the market environment or intensified competition in the next business year.

There is a brokerage analysis, clothing belongs to fast moving consumer goods, franchisees, distributors, there will be a problem of inventory measurement and sales revenue measurement, the terminal sales uncontrollable income is more difficult to check, it is the majority of clothing enterprises are not or questioned the main reason.

　　 Export to domestic sales aggravate competition

Miss yuan, who has been engaged in the garment industry for 8 years, thinks that there is a great relationship between inventory and fierce competition in the industry. Miss yuan is now working in a well-known foreign trade enterprise. She said that the export orders of garment enterprises have declined in recent years. "Before the profit rate can reach about 20%, and now constantly compressing the cost, it can only achieve 10%. It is too difficult to make money." Moreover, orders from Europe are almost a fraction of the past. For foreign trade enterprises, orders are few, but not production at all, and stocks are relatively small. However, a large number of foreign trade enterprises began to turn into domestic trade when the export orders declined, which intensified the competition of the domestic garment industry. She told reporters: "a large number of foreign trade goods occupy the market, and compete with domestic goods. The inventory of domestic trading enterprises is also large."

　　 Discount sales promotion is difficult to cure.

The inventory of clothing brands can be digested by various means such as year-end promotion, store celebrating, price reduction, outlet, online sales and two or three line city centralized digestion. However, such as vogue, Mester and so on, these fast fashion brands based on direct selling and parity will be difficult to digest through discount sales when there is a slow-moving fashion, because the price is not high enough.

The "inventory crisis" of parity clothing brands is just a representation. Discount sales promotion can not be completely solved. Inventory problem 。 CIC consultant's relevant industry researchers believe that in general, the scope of inventory in 10%~20% is regarded as safe stock, which is within the controllable range of garment enterprises. The key to keeping stock in a safe range is to realize the docking of production and marketing information, to pay attention to market information in real time, to process and analyze market information, and to adjust inventory.