The Korean Apparel Industry Leads To Buyout Retail Because Of The Rush Fee.

The hot topic of the recent circulation industry in Korea must be the seesaw battle between the Fair Trade Committee and the three giants of the department store.

The Fair Trade Commission argued that the fee should be reduced to a certain level (5~10%), which is equivalent to a certain portion of the operating income, while the retailing enterprises said they would reduce certain parts, but there was no room for Fair Trading Committee to specify the specific contents.

Almost 100% of the business revenue of the department store is the fee income.

Therefore, if the fee is to be shaken, it will be a direct blow to the operating income.

This is why the department stores are willing to risk their lives in the face of government departments.

But is this the right structure? If department stores no longer rely solely on fee income but increase the proportion of independent buyout products, will that change?

Let's do simple simulations.

The general charge level of the three major department stores is 30~38%.

On average, it sold one hundred million won, and about 35 million won was placed under the name of a department store.

But once it becomes a buyout structure, it can create a minimum profit of 45 million won and a maximum of 60 million won.

This is the result of the general general purpose purchase price (40~55% of the selling price) applicable to the industry.

Of course, it is impossible to sell all the goods at normal prices.

Then, even if the average discount rate is 15% (50% of the commodity price is the positive price, the remaining 30% discount rate).

The positive price is 100 million won, but the actual sales amount is 85 million won.

Minus the cost of purchase 45 million won (45% import price standard), department store income also reached 40 million won.

This amount is 5 million yuan more than the fee income.

But what makes Korean large department stores refuse to give up their fees?

In the Department Store giants on the issue of fee reduction and fair trade commission when you came to me, "little giant" clothing and love has been "buyout" thrown into the Korean circulation industry.

In June last year, the NC department store introduced the buyout system for the first time in the operation of song Po Garden5, and extended its scope to the pun Tang tower and Busan Yuntai. In September 29th, it launched a further upgraded NC store Jiangxi shop, showing its firm determination to buy out the system.

The company's strategy is to strike while the iron is hot. Next month, it will expand the total of 2001 outlets to NC department store and open NC department store in Kwangju's Migliore site this year.

The Hyowon Good plus in front of Busan University will also enter the construction phase as soon as possible after consultations with the tenants.

At present, the possibility of development has been verified, so the next step is to expand the number of shops.

Depends on the fee No! The buyout system is the way out.

The background of NC department store buying and selling as the main strategy can be traced back to the period of selling Homever in 2008.

Unlike the 2001 Newcore outlets, which used to act as a retail outlet for the brand of the clothing and love group, Homever (old Carrefour) has a larger share of its suppliers, so a large proportion of sales depend on fee income.

In order to improve business profits, the only way to squeeze suppliers is finally, while the management group, centered on President Pu Shengxiu, believes that this way can not last.

"President (Pu Shengxiu) believes that even if the financial hardship is severe, it will not give up as long as it can become a group's future growth momentum, but from a long-term perspective, it is more important to establish a new circulation mode", which is the way Homever sold a relevant person at that time.

at that time

President Pu Shengxiu issued instructions to all the staff: "after we bought Carrefour, we got more than lost in the name of Homever in two years". "We understand the boundaries of the existing circulation industry, so we need to establish a new circulation pattern quickly."

The first result of the research on the Korean new circulation mode that started later was the song Po shop, a NC department store opened last year. The shop that made up the wrong decision and upgraded was the recently opened Jiangxi store.

Jiangxi store and Lotte shopping are only 3.5 kilometers away from the Sky Park, which is investing heavily in Jinpu Sky Park, so it is expected that fierce competition will be launched, so love and love will also be painstaking.

In order to have the exclusive competitive power, compared with the song Po store in the 1st shop of Garden5, the number of buyout brands in Jiangxi store has increased to more than two times.

Song Po store, which opened in June last year, squeezed the bubble of LV and Gucci and other famous brand goods, while the Jiangxi store sharply reduced the price of famous cosmetics abroad.

Therefore, after the brand package, consumers can buy more famous cosmetics abroad than the existing department stores at a price of more than 20%.

Another feature is the introduction of famous fashion enterprises as buyout partners.

The reality of famous fashion enterprises in China is that they are squeezed to the corner by foreign famous brands and are difficult to sustain.

And in the competition of foreign brands in department stores, they were subjected to unfair treatment and had to shoulder high fees.

On the contrary, in the NC department store that uses the buyout system, enterprises do not have to pay the handling fee, nor do they have to bear the pressure of marketing and inventory. The department stores can also pass the exclusive prices of goods and prices to the NC department store's exclusive prices, thus creating the foundation for the growth and circulation mode of large retail enterprises and small and medium-sized fashion enterprises.

The NC store in Jiangxi has 7 floors and 10 floors on the ground, with a total area of 109 thousand and 904 square meters (33 thousand Ping) and a business area of 60 thousand square meters (18 thousand Ping), which is larger than that of Jiangnan Newcore or song Po NC department store.

Famous accessories are added to "luxury Museum", famous cosmetics to "beauty salon".

Usually, the first floor of most famous brands and famous cosmetic counters is the face of department stores.

Jiangxi stores add up to 2% less than that of the three giants, increasing the attractiveness of consumers.

The luxury Gallery, which has become the symbol of buying 100 stores, has been arranged on the first floor with the largest scale of 2300 square meters (more than 700 Ping) in South Korea.

The luxury goods hall is a brand buying store that combines the advanced management mode and the purchasing power of the attachment group.

In line with the overall scale, more than 70 luxury brands will be brought together, which is more than three times that of the song Po store.

In a more comfortable space, consumers can buy all kinds of brand-name goods that are cheaper than 20~40% in existing department stores.

It also reflects the demand for male names in the near future, expanding the scale of "male celebrity Museum" to two times in the past, and the "female brand footwear area" also expanded by 30%.

And launched the 165 square meter (50 Ping) scale "beauty salon (Beauty Gallery)", directly purchase Chanel, Lancome, Estee Lauder and other more than 20 top brand cosmetics equivalent to the top three products in department stores.

The famous brand buyout store has precedents before the NC department store, but the famous cosmetics brand buying and selling system store is the first place for NC department store.

The cosmetic brand buyout system after the luxury museum shows that the clothing and love group is determined to dominate the change of the circulation of famous stores, not just based on the income level.

As a result of the use of the buyout system, the store's merchandise is made up of the popular merchandise purchased by professional MD personnel, which is about 20% lower than the average department store.

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The new experiment of clothing and love, the amusement park enters the department store.

One of the biggest characteristics of Jiangxi store is that the space of 40% is composed of rest space and amusement facilities, coffee shop, dining room and educational space.

It is a new concept circulation mode that combines the advantages of department stores, shopping centers and amusement parks.

The children's theme park Cocomong children's Park is located on the 8 floor, and there is a 7 meter high viewing car.

Part of the 9 floor adopts a duplex structure, which shows the amusement facilities that can only be seen in the amusement parks in the suburbs.

Cocomong, the first launch of NC department store, has attracted more than 200 thousand paid visitors since its opening year.

On this basis, the Jiangxi store launches a further upgrade of Cocomong, which will be equipped with bumper car facilities and a cartoon character parade to allow customers to experience amusement parks in department stores.

The "child care service" for children taking care of children is made up of professional teachers' education + game course, which is significantly different from other department stores that only provide children's amusement space.

Another feature is the theme cafe on each floor.

The coffee shop in the casual wear store borrows the concept of TeenieWeenie brand from the bear bear cartoon brand, sells cartoon dolls and mugs, and the baby child commercial floor borrows the concept of the layer brand, opens the children's coffee shop, and sells the food that parents and children can enjoy.

Through these measures and densely packed clothing brands existing department stores, consumers can enjoy a more leisurely shopping environment.

There are also 200 flat (660 square meters) sky parks on the roof. There are venues and rest spaces for concerts and performances.

Clothing and love represent brands as the main content.

One of the biggest competitiveness of clothing and love circulation is exclusive cultural content.

Although it is an independent circulation enterprise, but on the basis of the regional business circle and market survey, we strictly select the "representative brand" from the more than 100 independent brands owned by the company, and sell it in the Jiangxi department store NC store.

Modern house, a professional store selling interior accessories, launched 2650 square meters (800 Ping) scale stores.

This is a business strategy that reflects the characteristics of the surrounding business circle. It is the largest store in the city's daily necessities stores.

Modern house is equipped with over 8000 commodity structures purchased by over 20 Merchandiser (MD) from 20 countries. The price is the 50~60% level of previous stores, so it has a high popularity among housewives customers.

The Jiangxi store will sell 40% of the furniture area as a whole, improving the overall structural maturity.

Mixxo, Spao and other local SPA brands have also launched 500 square meters of large-scale stores.

At the same time, sports outdoor editing store Spoblic, which has attracted much attention as a killer shop, has launched a 470 square meter store.

It is divided into 6 commercial areas, namely, footwear, outdoor clothing and supplies, sports equipment purchased directly from the world.

Try domestic fashion brand buyout system, East Gate merchandise editor shop "Trend collection" attention.

If luxury stores and beauty salons are overseas famous brand buying and selling system stores, then NC collection is the selling brand store of Korean famous brand merchandise.

Kinloch, L 'UOMO, Carte Blanche and other 6 men's wear brands and Topgirl, Niceclaup, Ansich and other more than 10 women's wear brands are here for sale.

The price is about 30% cheaper than other department stores.

Compared with the quality and design of the product itself, Korean brands usually have lower brand names than foreign brands, so they have to pay high fees in existing department stores.

As the Convention has been established, the structure of the fee structure will bring about the deterioration of earnings.

Forced to face the crisis of survival.

Under such circumstances, the significance of NC collection lies in the possibility of new growth with the domestic fashion enterprises through the buyout system.

In the face of foreign capital's famous fast fashion (SPA) brand attack, circulation enterprises are actively standing on the road of local brand development.

Stock and logistics, store leasing and operation are all handed over to NC department store. The price of goods is lower than the existing department stores, but on the other hand, domestic fashion enterprises can get a steady income.

NC department store plans to import 10 billion yuan products from domestic fashion enterprises this year.

A clothing and love related person said: "the goal of the purchase system of clothing and love is to change the existing circulation practice". "Department stores are no longer the places for obtaining the fees and fees for circulation channels, but are good commodities for developing domestic and even the whole world, and sell them to consumers at reasonable prices. This is the clothing style buyout system."

The editorial store Trend collection on the 3 floor is also worth noting.

In order to make up for the shortcomings of the department store brands that are difficult to respond quickly to changes in popularity, the stores are purchased from the east gate.

In the 82.5 square meters (25 Ping) scale stores, the latest popular products from fashion items to accessories are sold at a relatively low price.

In addition, the popularity of editors Global Collection is also quite high, which is made up of H&M, Zara, true religion, and other famous foreign casual wear brands such as Hollister.

Verification and stabilization of "possibilities" urgently need to make up for defects.

The first reaction of the industry and consumers is positive for the new attempt of the clothing and love group.

With the warming of foreign travel, consumers are dissatisfied with the exaggerated retail prices of Korean department stores, while NC department stores can eliminate some of this dissatisfaction.

But there are also suggestions that the NC department store needs to go beyond the barriers to become a real buyout system.

The biggest problem is the overbought system. The proportion of Chinese brand names is too high.

Because there is a limit parallel import structure in terms of quantity and supply of new goods, too much ahead will expand business risk.

The domestic brand buyout stores NC collection also has many shortcomings.

There are 10 women's clothing brands, including 2 brand names and 7 men's brands, including 1 brand names.

Because the composition of the brand is relatively weak, the store area is not big enough, and the age of the concept or target group is also different. Therefore, it is easy to be attacked by "face Engineering".

Industry experts believe: "buyout" operation in China.

The intention is good, but from the realities facing domestic fashion companies, it is not easy to plan for special merchandise series only for NC department stores. "If the buyout system is now becoming the individual designer and individual brand of the new vitality elements of the domestic fashion industry, it will be able to simultaneously satisfy the development of fashion and circulation industry and ensure the profits of exclusive commodities."