Why Does Niemann, A High-End Chain Store In The US, Develop In China?

After half a year online, Niemann Marcus, a luxury P Neiman store in China, is facing more than half of its redundancies.

Not only that, Niemann will also close China's e-commerce warehouse, directly responsible for the United States directly responsible for product sales and freight.

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< p > last December, Niemann formally launched the electronic business platform in China, and the operation center and warehouse were located in Shanghai.

Today, the company's Chinese website is only a Chinese version of the official website of the United States, and is maintained by a smaller customer service team and market team in Shanghai.

According to Niemann's spokesman, the reason for closing the Chinese warehouse is business mode adjustment.

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< p > Niemann's adjustment is probably due to the poor sales of domestic e-commerce platforms in the past six months.

Niemann's choice of e-commerce channels to enter China is not difficult to understand. With the rapid growth of domestic operating costs, many foreign retailers are deterring when formulating retail strategies.

In order to avoid risks, some retailers are choosing to avoid traditional retail channels and turn to a booming e-commerce channel.

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< p > data show that over the past five years, domestic distribution costs have risen by 200%, warehousing costs have increased by 23%, and advertising marketing costs have increased by nearly 50%.

In addition, the rental, logistics and labor costs of gold lots are increasing year by year.

Niemann chose to enter China to gain profits from the growing consumption demand of luxury goods in China, but at the same time, it had to face the high retail cost of entering the Chinese market.

From this perspective, the choice of e-commerce channels can not immediately assume the huge investment in the establishment of a physical store, and for the future opening of the physical store to test the water.

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< p > in fact, Niemann is not the only company to choose "curve into China".

Niemann and Messi, the two largest boutique fashion department in the US, have chosen to use electronic commerce to enter the Chinese market.

In March last year, Niemann invested $28 million in the glamour of China's luxury electric business website, accounting for 37% of its shares.

While Messi stores spent $15 million to invest in the domestic Jiapin network, and plans to sell some of its own brand products on the European and American platforms of Jiapin.

On this basis, more and more overseas luxury brands began to change their past conservative and arrogant attitude and speed up the layout of the domestic online retail market.

Armani, Ferragamo, Coach and Herm s are very obvious examples.

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< p > however, although e-commerce has reduced the cost of Niemann's channel, it can not solve the problem of its brand.

Whether it's a physical store or e-commerce, Niemann has never set foot in the Chinese market before.

By contrast, Messi put the Chinese market in the international direct mail area a year or more ago.

For Niemann, relying solely on Internet sales, I am afraid it is difficult to establish the popularity of retail brands.

After all, few Chinese consumers know who Niemann is.

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< p > in fact, many overseas fashion suppliers have launched Chinese pages for Chinese consumers. After the domestic consumers place their orders online, the company will distribute them through international express delivery.

The prices of these commodities are often synchronized with the prices of foreign countries, and only with the cost of international freight.

And those who really enter the Chinese market to set up warehousing operations are charged with taxes and fees.

In contrast, the price of the former has more advantages.

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< p >, it is not difficult to understand why Niemann suffered "acclimatization" in the Chinese market.

At least for now, luxury goods combined with pure electricity providers are not an effective business model.

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