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Consumer Goods Crisis: Clothing Industry With Internal And External Troubles

2013/9/25 10:38:00 26

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Clothing Consumption Garment Industry Clothing Market Garment Enterprises

P, no doubt, this is the worst of times. In the first half of 2013, China's gross domestic product (GDP) was 24 trillion and 800 billion yuan, an increase of 7.6% over the same period last year, the lowest growth rate in this century except for the financial crisis. Meanwhile, the total import and export volume in the first half of this year was 2 trillion US dollars, up only 8.57% from the same period last year. Compared with the two digit growth rate in previous years, the growth of the foreign trade center has dropped significantly. Against this background, the domestic consumer market is regarded as a life-saving straw. 
P, however, there is still no doubt about this change in the investment driven domestic market. In fact, domestic enterprises are also facing the crisis of cost increase, foreign brand extrusion and the most important mode of consumption and retail transformation. 
 for this reason, we have made a special topic on the consumer goods crisis, trying to sort out the related industries of consumer goods and retail. In the first part, we chose the largest online market capacity < a target= "_blank" href= "http://www.91se91.com/" > clothing < /a > category, trying to analyze the difficult predicament brought by the scale oriented and inefficient channel of clothing industry. 
 dressing is the most important thing for ordinary people to live in, and clothing is a very suitable industry for industrial operation. Therefore, this industry has spawned the most magnificent consumer goods market in China, and has bred the largest brand group in China today. 
After P reform and opening up, China's processing and manufacturing enterprises joined the global apparel industry chain as OEM manufacturers. OEM used to be a lucrative business which made Chinese garment manufacturers complete the accumulation of primitive capital. By the end of the 80s and the beginning of 90s, the brand consciousness of clothing enterprises began to germinate. Now the familiar clothing brands (such as PEAK in sports products, Lining, seven wolves in men's clothing industry, nine herdmen, etc.) were founded in that period. 
 standardized and high premium won 
 although the different subdivision < a href= "http://www.91se91.com/news/index_c.asp" > garment industry < /a > almost start at the same time, but the pace of their next development is far away. 
 sports goods industry is a relatively standardized industry. It is the best test field for clothing brand. Early Chinese consumers wore fashionable sportswear as the fashionable consumption concept and the 2008 Olympic Games in Beijing, which boosted the development of the industry. As a result, sports brand has become the earliest, fastest growing and largest group in China's apparel industry. The six major local sports brands, Lining, Anta, trend, XTEP, 361 degree and PEAK, had already broken through or nearly 5 billion yuan in 2008, and the income of Lining and Anta even reached 10 billion yuan. These brands are organized in the form of affiliate sales. If they consider the effect of channel amplification, their sales in the terminal market will exceed 10 billion yuan. 
The property of standard makes the market concentration of < a href= "http://www.91se91.com/news/index_c.asp" > sports goods industry < /a > very high. Quanzhou is known as the hometown of sports goods in China. The first tier sports brands in the mainland come from this area except Lining. There are more than 3000 sports brands registered here, but they are far behind the first-line local brands both in size and influence. 
 compared with sports goods, men's clothing is more personalized. But compared with women's clothing, men's clothing is relatively standardized. Some sub sectors, such as business dress, not only standardized product attributes, but also supported a higher premium. So this industry has become China's earliest mature and subdivided garment industry. The main business of China's first listed clothing brand fir was business dress. 
 although the suit is suitable for brand operation, the scale of the industry is relatively small, so it is easy to touch the ceiling. The two leading brands in the industry, YOUNGOR and Shanshan, have adjusted their main businesses in this century. Relatively speaking, business casual men's clothing market capacity is greater. This industry is another fast growing mature menswear subdivision business after business is formally installed. Seven wolves, Li Lang, nine Mu Wang, Zhen Ba, Qipai and other brands all come from this industry. 
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After the entry of this century, some of the more fashionable and personalized "a" href= "http://www.91se91.com/news/index_c.asp" > men's wear brands < /a, such as Mark Ed Faye and GXG, began to emerge in P. 
 a subdivision industry that we have to mention here is the public casual wear. Whether business dress, business casual, or business fashion brand, as long as the title of "business" two words, the consumer's affordability can be guaranteed. However, the price tolerance of the general public is very low, and the high premium can hardly be accepted by the market. This requires the mass leisure clothing brand to constantly optimize and improve its channel efficiency. Local casual wear brands such as Smith Barney, Semir and YISHION have been licensed as early as the mid 90s of last century, but their low efficiency has been restricting their development. 
 as for women's clothing, it can be said that Waterloo is the local clothing brand of China. Domestic brands < a href= "http://www.91se91.com/news/index_c.asp" > women's wear industry < /a > the top three brands are Only, Vero Moda and AGG, all of them are foreign brands. "Http://www.91se91.com/news/index_c.asp" As we all know, women's wear is a big market, and domestic brands have been involved in this field for a long time. The brand of women's clothing, such as Gloria, Europe, and so on, has been working on this market as early as the end of the last century. But in the past more than 10 years, the brands of local women's wear brands still haven't grown up to match the brands of sports goods, men's wear and international women's wear brands. The situation of high-end women's clothing is relatively good. Ranzi, white-collar, Mass Phil and so on are the top ranked brands in the industry. 
 > a href= "http://www.91se91.com/news/index_c.asp" > children's wear < /a > underwear is also a very important part of the clothing industry. But overall, the development of these two industries in China is not very mature. 
The same starting point, similar development route, eventually formed a completely different market competition pattern. We can comb out the following key development logic: 
 the key word in the industrial age is "scale effect". A "a" target= "_blank" href= "http://www.91se91.com/" > clothing < /a > produces 10000 pieces and ten garments to produce 1000 pieces. The cost will inevitably be different. The factory is more willing to accept the former. And 100 of the 100 garments are produced by all factories. Large scale operation makes business profitable. 
 on the other hand, in the circulation of commodities, the low efficiency of channels is the limiting factor of all brands. In the age of planned economy, there is no market for free circulation of commodities. After the reform and opening up, China's commodity circulation system was built on the basis of nothing. The agency system is now widely criticized, but local clothing brands began to widely adopt this model to expand. It is a matter of more than ten years ago since the late 90s. Tier agents also result in a price increase. 
The result of "P > scale oriented and inefficient channel is the rapid development of standardized and high premium industries, and the personalized and popular products are struggling. Specific to < a href= "http://www.91se91.com/news/ > clothing industry < /a >, the former corresponds to sports goods, business men's clothing, < a href=" http://www.91se91.com/news/ "> high-end women's wear > /a > and other industries, the latter corresponds to the industry of public casual wear, women's wear and so on. 
 international brands come from behind 
 but in recent years, new shocks have followed. 
 first is the downturn of the industry boom. After entering 2012, domestic a target= "_blank" href= "http://www.91se91.com/" > textile < /a > industrial added value of garment industry increased year by year, from the previous two digits to a single digit. Last year, the retail sales of clothing commodities in the wholesale and retail enterprises above designated size were 672 billion 380 million yuan, an increase of only 17.7% compared with the same period last year, which is even slower than the 20.8% increase in 2009. 
 this year's situation is even more optimistic. According to the statistics of the China National Business Information Center, the retail sales of clothing commodities of hundreds of key retail enterprises in the first half of this year increased by 6.9% over the same period last year, down 2.9 percentage points from 9.8% in the same period last year. 
 for Chinese enterprises accustomed to the annual growth of dozens of times, the development speed of such industries takes time to adapt and adjust. At the same time, this also means that local clothing brands and manufacturers will face increasingly fierce competition and industry reshuffle. This is called internal worry. 
 at the same time, < a href= "http://www.91se91.com/news/" > international brand < /a > is aggressive. As mentioned before, mass leisure and fashion clothing have always been the weak areas of domestic clothing brands, but international brands are very strong in this field. They have strong brand appeal, mature quick response supply chain and abundant terminal retail experience. These brands have accumulated the experience of expanding the Chinese market through the exploration in the Chinese market in the past few years, and began to expand in recent years. 
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 by the first half of this year, the number of H&M stores in China has reached 150, and now it can even see H&M stores in some four tier cities. In the first half of 2013, H&M realized sales of 2 billion 880 million yuan in China. 
The expansion of P is faster. UNIQLO plans to open 80 new stores in China this year, bringing the total number of stores to 225. 
P, Zara, H&M, UNIQLO, the major international SPA clothing brands, have sold more than 5 billion yuan in the Chinese market every year. In just a few years, they are among the top brands in the Chinese market. These brands also drive other international fashion brands to nugget the Chinese market. When they are in full swing, local brands will inevitably be impacted, which will have a strong impact on women's clothing and casual wear brands. This is called foreign aggression. 
 another important factor affecting the local clothing brand is the development strategy of the enterprise itself. The early overexpansion and the channel abuse are the common difficulties faced by many local a href= "http://www.91se91.com/news/" clothing brands /a. 
 the most typical industry of excessive expansion is sports goods. By the end of 2011, the number of terminal stores of several major local sports brands had reached about 8000, and they were all pervasive in all China's cities. However, under the combined attack of internal and external troubles, the operation of sports brand is deteriorating rapidly: the sales of terminal market are blocked, the profit of agents is urgent, and the backlog of channel inventory is... In the next few years, the sports brand had to accept painful adjustments: selling inventory, closing stores, and re distributing channels. 
 changes in labor pains 
Combined with the above factors, P has become the deductive logic of Chinese garment industry in recent years. 
 sports products are most suitable for large-scale and brand operation. The industry is the earliest and the most mature. But the excessive expansion of the industry before and after 2008 has laid a curse on the future. After more than two years of adjustment, sports brand is still digesting this evil result. 
 in the first half of 2013, Lining completed a revenue of 2 billion 905 million yuan, down 24.6% compared to the same period last year. At the same time, Lining also recorded nearly 40 million yuan of operating losses. Lining's store has also been compressed to 6024, and more than 2000 stores have been closed. 
 but the sports industry is also showing positive signs. Anta's revenue is also decreasing, and its store network is also adjusting, but the profitability of the brand has been good. In the two quarter of this year, the growth rate of Anta's same store sales declined. Anta's 2014 spring order sales also achieved a single digit growth, the first increase since its autumn order meeting in 2012. This also indicates that Anta is expected to return to the expansion era. 
 > a href= "http://www.91se91.com/news/" > business men's wear < /a > has suffered from internal and external troubles, and business men's wear brand development strategy is more robust. Therefore, in 2012, when the domestic clothing brands were everywhere, the commercial men's wear brand could still achieve brilliant performance growth. 
 but in the first half of this year, the performance of commercial men's wear brand was inevitably dragged down. In the first half of the year, the earnings of the nine herd kings and the first half of the year have declined to varying degrees. Under the so-called nest, there is an egg. 
Less than P, local casual wear brands have been hit most comprehensively. Just as they are ready to launch their own efforts, they have been influenced by the expansion of international brands, the downward trend of macro economy and the runaway of their own development. In haste, we have to carry out comprehensive reforms in products, channels and supply chains. Products, local leisure clothing brands began to try to personalize, fashion closer. On the channel, the United States has carried out a great number of explorations in large shops and direct battalions. In terms of supply chain, flexible and quick response supply chain has been the pursuit of all clothing brands. 
 2012, although the revenues of the two major local casual wear brands, the United States and Semir, were only slightly lower, their net profit fell by more than 30%. In the first half of this year, Semir's performance rebounded, its casual wear increased by 2.55% compared to the same period last year, and net profit also increased year-on-year. However, in the first quarter of the year, the revenues and profits in the first quarter decreased by 15.7% and 44.8% respectively. In the most optimistic case, Smith Barney expects net profit in the first half of the year to decrease by 30%. 
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 the baptism of the new format of electricity supplier 
 this year is a year of baptism for the traditional "a href=" http://www.91se91.com/news/ "clothing brand" /a ". Brands have to pay for their strategic mistakes, and they must learn to accept the natural fluctuations of the economy and the survival of the fittest in market competition. 
 there is also a factor that we have been holding down before, that is electronic commerce. From now on, the traditional clothing brand will start to be truly baptized by e-commerce. From last year's market data, the penetration rate of e-commerce in the clothing industry has reached nearly 20%. This shows that e-commerce has become a new form of business that can match the department stores, stores and other formats. 
 e-business can imagine much space, but it is first a channel for the circulation of commodities and information. From this perspective, its impact on brand should be very limited, because the brand should exist beyond the channel, and the emerging channel is also the opportunity of traditional brand. The annual turnover of some traditional clothing brands on Taobao has exceeded one billion yuan, indicating that these brands have a very wide influence both online and offline. 
 but at the same time, we also see that many online businesses which attach great importance to e-commerce are in the bottleneck, and there are even many cases of decline. This phenomenon is very worthy of reflection and vigilance of clothing brand. 
 in the early days of commodity shortage, who could produce products of low price, and who could occupy the market, we call them brands. After entering the era of commodity surplus, who can get the agent, who can occupy the market, we also call it brand. This is the brand logic before China's a href= "http://www.91se91.com/news/" > garment industry < /a >. But when the competition of the channel is white hot, especially when there is no boundary channel for e-commerce, how should we create the clothing brand?