Domestic Garment Enterprises Develop Towards High Value-Added Business

Mainland processing enterprises have been actively seeking pformation and upgrading in recent years. We hope that along with the value curve, from the production activities, we will gradually develop and develop higher value added R & D, design, marketing and other businesses, or start with the production technology and product quality. We hope to upgrade the value curve and upgrade the competitiveness and value added of the overall business through upgrading.

The performance is more prominent.

The pformation and upgrading of garment enterprises are developing in many ways.

In addition to strengthening technology and quality management in production, many garment enterprises have advanced to the upstream business, and have begun to product design, research and development and application of new materials, hoping to increase product value.

Many of the original manufacturers started to develop distribution business. Some of them were more successful in entering the retail market, establishing cross provincial or even nationwide retail networks, and developing their own brands.

In order to focus on pformation and upgrading, many garment enterprises are gradually strengthening outsourcing and fading out of production.

Qiu Liping, deputy chief economist of the Hongkong Trade Development Council, said: "in the process, we will not only compete for foreign capital and Hongkong's brand to enter the mainland market. They will expand their upstream and downstream businesses from production to business, and will also generate different service needs to provide business opportunities for the relevant service providers.

As for Hong Kong businessmen who want to concentrate on production, we should pay attention to the gradual increase of business opportunities of outsourced production with the pformation of mainland enterprises.

To further understand the brand development of mainland garment enterprises and their demand for outsourcing production and business services, Hongkong TDC issued related telephone enquiries to about 2000 mainland garment enterprises with their own brands last December to March this year.

The surveyed enterprises are distributed in different provinces and cities in China, and over 70% of them are currently in annual sales of more than 1 million dollars.

According to the survey, most of the 89% (surveyed) clothing companies with their own brands are targeted at developing the national brand.

But in the face of the strong competition of imported high-end brands, 90% of the enterprises locate their brands in the mid-range or mass market, and take two or three line cities as the main sales targets.

85% of the surveyed enterprises are developing the market through direct retail stores or counters, and only 37% of them are entrusted with distributors.

However, with the increasing maturity and popularity of franchising and online sales, 64% of the companies surveyed have franchised businesses, and 56% have sold products online.

The sales scale of enterprises is bigger and bigger. For example, 34% of the enterprises surveyed have annual sales of over 10 million US dollars. In order to cope with brand development, enterprises tend to allocate more time and human resources to product development, design and marketing with higher added value, and gradually outsource production to their producers.

Of the enterprises that received the enquiry, 38% said they had outsourced production, while the other 9% had not yet outsourced production, but they would consider it.

Qiu Liping pointed out that it is noteworthy that from 2005 to 2010,

Exports increase by an average of 12.9% per year, but clothing and shoes and hats increase by an average of 21.4% per year. This shows that the scale of production of Chinese garment enterprises, especially those selling their own brands in the mainland market, has been increasing.

Hongkong producers can pay attention to the gradual increase of business opportunities of outsourced production by mainland enterprises.

She added that mainland consumers' brand awareness is getting stronger and stronger. Hongkong TDC's survey on mainland consumers of different consumer products, including clothing, jewelry and watches, shows that product brands and their image taste are important considerations for consumers to choose products.

In other words, "brand" is the inevitable way to develop the mainland market.

To build an effective brand, she said, enterprises must choose the right location according to the characteristics, preferences and acceptability of their target consumers, and design products and brand images, including product packaging, shop atmosphere, advertising design, etc.

Most of the garment enterprises that are interviewed or used are logistics distribution services, followed by advertising and marketing.

In terms of brand strategy, many enterprises are inclined to deal with it internally and in the future. However, some enterprises will use / refer to external professional advice, and obviously use external concepts and product design, architecture and interior design services.

At the same time, in order to enhance the internal management and operation of enterprises to meet the overall development needs of enterprises, more enterprises have indicated that they will use enterprise management and training services.

In improving technology and product quality, enterprises will also purchase production technology and environmental protection technology.

Qiu Liping expects mainland garment enterprises to gradually move from production to production.

In the process of development, various business and supporting services will be increased to provide business opportunities for the relevant service providers.