Interview With Lv Changfu, Training Lecturer Of China Fashion Designers Association

Adjust terminal to maintain balance

Reporter: this year

The problem of high brand inventory is particularly prominent. Enterprises hope to rely on a strong sales terminal to digest inventory. What aspects do you think the terminal should balance inventory?

Lv Changfu: terminal inventory balance can be done from three aspects: the small balance of display, the balance between store purchase and sale, and the great balance of brand inventory.

The small balance is related to the beauty of display, and the balance affects the positioning of the brand. The big balance determines how long the brand can survive.

Reporter: how to keep balance on display?

Lv Changfu: there are three ways to balance the shelf structure. They are symmetrical, repetitive and balanced. No matter which way it is, it is for the overall beauty.

Like a person with symmetrical facial features, a person who looks more inclined than a crooked nose looks beautiful. A balanced display can make the product look more comfortable.

I have seen a lot of Chen teachers like to make the architecture strange, and feel very creative, but do not know that the structure has been out of balance. These teachers only focus on the part and ignore the whole, only one area and the overall situation, and justifiably say that many brands do so.

The small balance can also be used in the matching of window modules. If one side is light, add some heavy colors or props on the other side to press it.

Reporter: what changes should the store make in the purchase, sale and inventory?

Lv Changfu: the balance of purchase and sale of stores refers to the balance of goods in store, sale and stock in a time period, which is embodied in two aspects of goods and shipments.

Goods on sale: after a number of cycles of sales, the total number of goods will be reduced. In order to maintain the continuity of late sales, it is necessary to load the goods.

There are 1 weeks, 1 times, 2 weeks, 1 times, 3 weeks 1 times, 4 weeks 1 times. The cycle of goods loading can be determined by the speed of turnover.

Shipment: a certain product on each cycle, if the 15 styles, it is difficult to sell every code of each section. As time passes, the remaining amount of the display will be more and more. When it exceeds the storage capacity of the brand, it must be shipped.

The shipment can be allocated or returned, and the goods pferred are usually products that are broken or not sold in season, and most of them are returned to the end of the life cycle.

I have seen some shops, once a week for 3 weeks, and a half year return. The display volume of the shop has already exceeded the scheduled display volume, so the cartons full of goods have to be placed under the shelves to make the shops look very jumbled.

As a result, customers are reluctant to come, and sales performance is also declining. Therefore, they are frequently discounted, and the customer level is reduced.

In fact, this problem is not difficult to understand, just like a person can keep his absorption and excretion system balanced and his face will look good.

The store is also a life system. In addition to relying on sales and maintenance shops, it is possible to maintain a balance in order to maintain the vitality of the business and make the virtuous circle go even farther.

If a brand produced 100 thousand stocks last year, it could clear 20 thousand pieces this year, but according to this year's sales plan, increase rate and production and sales rate, it is expected that 120 thousand stocks will be produced this year.

If only 20 thousand pieces of inventory can be cleaned up each year, it will add more than ten million pieces of inventory every year, and digestion capacity is only a fraction.

This leads to the larger number of stores, the greater the accumulation of inventory. The result is a serious imbalance between inventory generation and digestion, and profits will naturally decrease year by year.

The continuous profitability is to maintain the nutrition of brand life, so that nutrition is less and less until the end of the company's life.

I have seen a brand A in order to reduce the stock to go on the market, greatly reducing the production of products, a city 4 shops shared a warehouse, the more than 10 square meter warehouse only 40 ~50 pieces of goods, sales were severely suppressed, and the stock is still not down; and another brand B is mandatory for franchisees to open shop, and ask the franchisee store 40% of the previous year's goods, franchisee complain constantly, inventory problem has not been solved.

Like the A brand, the "luxury" mode of a single store is not feasible. The imbalance between production and sales can not be solved by reducing production.

Similarly, the way the B brand imposes inventory on franchisees can not solve the problem, because the annual product will also generate inventory, resulting in the brand image of selling second-hand goods every year.

Reporter: so how to solve the problem of inventory generation and disequilibrium?

Lv Changfu: in this production and digestion imbalance, in order to achieve a new balance, some brands can react quickly at the end of production. A piece of fabric can be placed in shops with 6 ~7 similar items.

The vast majority of brands can only be digested at the digestive end, ignoring the need to improve the sales rate of new products.

The higher the production and sales rate of the seasonal products, the less inventory we need to clean up in the coming year. I once attended a director's meeting of a women's clothing brand, and learned that the sales rate of its brand is only 27% in half a year. That is to say, if the production volume of this half year's product is 100 thousand, there will be 73000 stores. At this time next year, there will be 73000 stocks to be cleaned up. If the production and marketing rate is not 27%, but 72%, there will be only 28000 pieces of inventory to be cleaned up next year, and it will be easier to clean up.

Reporter: is there any way to improve the production and sales rate of new products?

Lv Changfu: some people engage in activities, some people do VIP special field, these are not necessarily able to increase sales volume, but only concentrate a few customers on these days. There are 3 truly effective and feasible methods: 1., the right products are put into the appropriate shops; the work is done by the Commissioner of goods; 2., the products that are to be sold are easy for customers to see and buy; they need to familiarise themselves with the sales and inventory situation of the shops, and eventually turn them into productive forces; 3., every time a customer is sold, a joint sale is made, and the salesperson needs to dress up the customers with the products of the shops, sell the products to a customer, and form a high customer list.

Reporter: regular clearance channels include the network, the anniversary of shopping malls, and the clearance of goods before decoration. Is there any new clearance channel?

Many cities are building outlets, introducing brand discount stores, and some depressed shopping malls want to be pformed into outlets. This is also a good way to clear goods.

Some people say that there are so few outlets in the country that we can't get in. It doesn't matter whether we can get in or not. We can open our own outlets.

In some places where the price shops will not be opened, such as the three tier cities in the Midwest and the four line cities in the coastal areas, even if the price stores are open, the sales performance of 100 thousand yuan per month can not be done, and there will also be a lot of stock, so it is better to make discount stores simply.

The number of stores in the discount stores is determined by the annual increase in inventory. The core role of the discount stores is to regularly clean up inventories, rather than to increase performance, so they do not bear excessive performance pressure.

The other is to cut off brand labels such as tag and water mark, deal with some wholesalers at a very low price, and finally go to bulk stores around the country. This kind of channel is more common in low-end brands, and it is not recommended to use high-end brands.