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Mergers And Acquisitions Of Garment Enterprises Are Difficult To Integrate.

2014/3/2 16:43:00 190

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Garment Enterprises Mergers And Acquisitions Semir Apparel

over the past ten years, the number of mergers and acquisitions in China's garment industry is not large, but it has never stopped.

In the early years, Kappa acquired the Japanese skiing brand PHENIX, and BELLE's acquisition of Shen Da was a successful case.

In 2013, the most popular acquisition in the clothing industry was Semir's clothing acquisition of GXG. It was thought that the dust settled, but in January 2, 2014, Semir apparel announced its abandonment of GXG in its official website, which made the industry widely divided. Earlier, on Saturday, the footwear industry acquired D:FUSE < A href= "http://www.91se91.com/news/index_h.asp" > brand "/a".

These cases have cast a shadow over the merger and acquisition of Chinese local apparel enterprises.

as we all know, China's clothing market is a brand competitive market which is separated by brand segmentation.

M & a brand should be an inevitable choice for garment enterprises to expand their market.

However, M & A is not a simple acquisition, but a merger. If the merger can not examine each other's advantages and disadvantages, it will be the result of 1+1 less than 2, and even weaken the value of each brand.

the emergence of local garment enterprises is beginning to show up: /p >

June 19, 2013, Semir < a href= "http://www.91se91.com/news/index_f.asp" > dress < /a > held a media and investor exchange meeting in Shangri-la Hotel Wuhan in Shanghai, and announced the acquisition of GXG in a high-profile manner.

At that time, the top executives of both enterprises came to the scene. In the face of dozens of media and investment institutions, the senior executives of Semir dress talked about the future plan.

in the eyes of the outside world, Semir clothing is mainly located in the low-end market, and its competitors are mainly Metersbonwe, YISHION and other mass leisure brands.

In recent years, as foreign fast fashion brands have entered the two or three line market in China, the market of local casual wear brands has been seriously squeezed.

According to the data, Semir apparel achieved 7 billion 63 million yuan in revenue in 2012, down 8.43% compared with the same period last year.

The GXG brand in zendu fashion Brand Company is located in the middle and high-end. If the three major products of GXG enter the Semir apparel system, Semir will expand the product line of men and children's clothing.

By acquiring GXG, Mori Majung can increase the product's richness.

however, in 2014, Semir clothing unilaterally announced the cancellation of the merger of GXG, but has not announced the reasons for the ceasing of the purchase, which makes the industry widely divided.

"On the face of it, the merger of Semir and GXG can relieve Semir's pressure on product mix and performance.

But the most important point is that the integration of corporate culture is the key to the merger of the two enterprises.

If the two sides are fully contacted, they find that there are differences in brand positioning, cultural style, market target and purchase price. Adopting the suspension mode should be a rational behavior.

Angeli Jan founder, clothing marketing expert Angela so evaluation.

Zhang Qing, chairman of the key road sports consulting company, believes that Chinese clothing enterprises have been seeking diversification of capital for a long time in the past. The enterprises are generally small in scale and serious in homogenization. Now, in the background of the impact of fast fashion brands and e-commerce, the merger and acquisition of local garment enterprises is emerging. But the more serious problem is whether to turn left or right.

left to the left, we must stick to the core positioning and cut the high-end design chain from the original design, such as the new domestic product and the Chinese style design route, which are popular in the past two years, but this method is obviously more difficult. Not every enterprise can do it. To the right, we must look for the opportunity of value chain integration upstream supply chain and channel complementarity, so as to enhance the concentration degree by way of tug of heating, so M & A is a new start.

"but pure capital integration can not solve the fundamental problem of the garment industry. If China's clothing brand can not improve the quality, reduce costs and improve the fine management, this merger can not achieve the goal of 1+1 greater than 2."

Zhang Qing said.

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M & A is easier to integrate than /strong > .

in the international market, LVMH, Li Feng and Gucci group are the masters of mergers and acquisitions. They have successfully incorporated many brands into the group and maintained the healthy development of their respective brands.

However, in China, mergers and acquisitions are difficult, which is very different from other industries, especially in other production industries.

"in clothing industry, the biggest asset of a company is not a factory or a shop, but a brand -- a brand with its own characteristics and genes.

Compared with other industries, clothing enterprises are more influenced by cultural factors than the other industries. The original power of products has greater differences, which will cost a lot of time and money for enterprises.

He said.

for Saturday footwear industry to buy the D:FUSE brand of heppu shoes, it is a tough time for a domestic fashion brand to acquire "foreign" fashion brands.

The management of foreign enterprises is different from the management culture of domestic enterprises, especially in the salary and incentive mechanism. The D:FUSE brand of heppu shoes is positioned as ZARA in shoes, and the main trend is fast fashion. The advantage of D:FUSE is not quality but style. The brand positioning on Saturday is more biased towards popular fashion.

It is inevitable that the two acquisitions will not adapt to the integration of business management and product style.

"every enterprise looks at the market with different views and attitudes, so they can have different products and face different consumers.

This vision and attitude is the culture and brand characteristics of an enterprise.

These differences may be difficult to integrate for the merged brand.

Because integration means the disappearance of the soul of the brand itself.

Therefore, after merger and acquisition, various problems are inevitable.

It depends on how the two sides look at these differences.

He emphasized.

for example, when the D:FUSE brand was bought by the shoe industry on Saturday, the members of hepper shoemaking felt that D:FUSE had no taste of D:FUSE. Since entering the market in 2007, the brand of D:FUSE has been positioned as ZARA in shoes. The main trend is fast fashion, and more than 200 styles will be launched every quarter. The output of each style is very small, and the problem of breaking codes often occurs.

After the merger and acquisition of the new team, the style of D:FUSE is obviously reduced, which is less than 100 per season, and begins to take the mass line, which makes the brand lose a lot of loyal consumers.

in Zhang Qing's view, for the fashion brand, the future trend is "multi SKU, a small quantity", because consumers want more choices. From a fashion perspective, the more personality is, the easier it is to attract consumers, more design styles and less inventory can meet the market demand and reduce the risk of inventory.

But whether the shoe industry can agree with this concept on Saturday is a huge challenge.

M & A needs to find the original power of the brand /p >

in recent years, under the background of the high rent, the impact of online shopping and the rapid entry of international fast fashion brands, local garment enterprises have bid farewell to the era of high growth and entered the era of original power driven by professional talents and capital.

Many high growth companies (especially listed companies), due to lagging behind in their original dynamics, need to achieve stable growth or improve their competitiveness through brand mergers and acquisitions. They are targeted at new rising brands with high growth characteristics but lack of capital base. This also gives birth to a new form of business -- clothing mergers and acquisitions.

however, many mergers and acquisitions in China are short of professional operation due to capital promotion, and most of them fail.

According to angel, the two mergers and acquisitions of Semir and Saturday shoes are respectively existed before and after mergers and acquisitions.

In his view, Semir and GXG should have a more comprehensive exchange and discussion before mergers and acquisitions, instead of just considering product lines or economic benefits. On Saturday, the merger of footwear industry and D:FUSE is the result of incomplete integration of the two enterprises and inadequate allocation of resources, resulting in the effect of < a href= "http://www.91se91.com/news/index_s.asp > M & a" /a ".

Therefore, the two M & A enterprises should fully understand their brand attributes, channel attributes and cultural attributes before merger.

in fact, whether the capital comes from the industry or the industry, the personalized characteristics of the garment enterprises are still crucial.

And this individuation will necessarily include where the "primary power" is, and how to adjust the 1+1 to 2.

"This is not the capital itself can solve, he needs is suitable for the characteristics of the industry strategy, this strategy is not only to do, but also to find who do the problem."

He said.

"P >" as a strategic consultant for the sporting goods industry, Zhang Qingye believes that the rise of an enterprise, merger and acquisition will not be the key behavior, but also the dominant product, that is, the original driving force of the brand.

Like UNIQLO, it was also quickly vanished by ZARA and GAP, which is almost the same as today's local brand.

However, UNIQLO is now able to regain its popularity as the world's third fastest fashion brand by virtue of its technological advantages in basic terms. This is the key to "brand's original power".