Capital Princes March Into The Garment Industry

Driven by the great wave of global economic integration, Quanzhou's textile and garment industry has attracted the attention of the "Princes" from all over the world.

Reporters went to Beijing last week to attend the 2008 China International Clothing and Accessories Fair (hereinafter referred to as the "Clothing Fair"), and learned that many financial institutions were preparing for "marriage" of Quanzhou private enterprises.

The Chinese clothing forum, which has always been regarded as a "feast of thought in clothing industry", was held during the Expo.

On the forum, Xu Xin, President of today's capital group, Chen Fan, global joint president of Standard Chartered Bank, Chen Fan, founder of Lanshan (China) capital, Tang Yue, Bohai fund helm, and other prominent figures in the field of capital operation.

The industry believes that this sends a signal: entering the era of Chinese clothing in the age of wealth creation is becoming the "Darling" of all kinds of capital.

After years of competition and integration, Quanzhou's textile and garment industry has formed a certain degree of industrial agglomeration. A number of well-known enterprises and brands have emerged and the industrial chain has been perfected.

This year, the output value of Quanzhou's textile and garment industry is expected to break 100 billion yuan.

In less than a month, three well-known investment institutions came to Quanzhou one after another.

Carlyle fund, Chung Tak fund and today's capital and other well-known private fund companies are seeking cooperation with a huge amount of chips. Morgan Stanley, GF Securities and other well-known brokerages are ready to marry Quanzhou private enterprises; Nomura international China Investment Co and Pu Kai China Investment Co have stepped up their pace in this regard.

Over the past five years, the trend of industry development shows that garment enterprises are gradually embarking on the path of capital operation.

Last year, BELLE, Anta, news birds, China Trends and other enterprises launched a series of actions to raise the market trend, so that other domestic clothing brands feel pressure, many brands are also embarking on the listing plan, in order to finance and expand the sales network.

Many brands in Quanzhou, such as Li Lang, nine Mu Wang, CABBEEN and Jin Ba, have shown their determination to create the "Quanzhou plate" in the capital market with their practical actions.

"But the market is changing fast.

I feel that today is no longer an era of brand development relying on individual capabilities.

A brand system and a brand life are very important support for brand development.

Li Tianfu, deputy general manager of Fujian Marat apparel Co., Ltd. believes that the exploration of new development mode in the construction of enterprise system is increasingly influencing, such as Internet intervention, capital operation, channel innovation, cultural creativity, design strength and so on.

Industry analysts believe that the rising prices of raw materials and labor costs, and changes in various external environments are pushing the local manufacturing industry with "cost advantage" to push itself into a changed situation.

For many enterprises, they are facing not only the pressure of increasing the cost of production factors, but also the pressure of financing.

"Since 2007, the textile and garment industry has felt the pressure of credit crunch."

Sun Ruizhe, vice president of the China Textile Industry Association, said banks are generally reluctant to continue lending to the industry which is heavily influenced by macroeconomic regulation, added value and generally low profits.

"But from an enterprise perspective, it is impossible for us to curb our financing needs."

A clothing business manager said.

"In particular, small and medium-sized enterprises have no capital to become the biggest obstacle to their development."

Xu Xin, capital president today, thinks that money does not necessarily establish a brand, but it is impossible to build a brand without money.

If enterprises want to get the favor of capital, they need to practise internal strength.

Xu Xin believes that enterprises must have excellent character first so that Vc firm can give money to the enterprise at ease.

In addition, entrepreneurs need "killer instincts" to accurately seize market opportunities.

"The power of capital is huge, and the speed of capital development is very fast. Many enterprises are not ready yet, and capital can not find them, and they can not find capital either."

He said.

This reporter has learned that the more than 10 Quanzhou brand enterprises such as the seven wolves, CABBEEN, Malet, Green, Bao de and AI Deng Bao participated in the fair, and the Quanzhou fashion trend has been launched.

During the exhibition, ITAT group, a clothing retail chain company, announced high profile strategic investments including Lanshan capital, Morgan Stanley, Merrill Lynch (Asia Pacific) and other companies with a total investment of up to US $120 million.

The "small profits but quick turnover of scale businesses are still attracting the attention of all kinds of capital. ITAT's rapid rise shows the capital efficiency of the industry."

Tang Yue, China capital partner of the US investment fund, said Mr. Tang Yue.

And this event has also lit up a bright light for the capital operation of Quanzhou's textile and garment industry, and has enhanced the confidence of the development of brand enterprises.