How To Create Benign Inventory In UNIQLO

"We prefer to create a certain inventory rate, which we control at around 3%."

"For Uniqlo It is not a good thing to sell out. " Pan Ning, a senior executive vice president of global marketing group and CEO of Greater China, recently told reporters that "we prefer to create a certain stock rate, which is controlled at around 3%."

Pan Ning analysis said that if every quarter cleared, the actual sales losses were very large, SKU (inventory units) were not complete, and the final situation was discounted. The good inventory ensures that all the main products are covered and that important goods are available.

　　 "Benign" Stock

For most garment enterprises, the fundamental reason for implementing the O2O (online to online) strategy is not only the most fashionable Internet thinking under the eyes of the wind, but rather fundamentally controlling inventory and effective clearance.

For retailers, the most difficult thing to do is to control inventory. As Pan Ning said, "the product is sold out, and it has been collected in large quantities, just like blood. If you stay in one place, it will become a thrombus and become an obstacle. Further operation will produce a burst."

So, how can we make inventory not the burden of enterprises, but the driving force? From sales to replenishment and logistics, Penning explained to reporters the whole supply chain system of UNIQLO.

The first step is the sales plan. Before making the sales plan, UNIQLO will make the budget on the basis of last year's and last year's data. For example, how many new stores need to be expanded, how high will this year's sales increment be? 5%, 10% or 15%? Finally, a specific figure will be determined.

Next is the quick response and replenishment link. This link is also regarded as the most important link in the sales process by H&M and ZARA, a competitor of UNIQLO, which needs a lot of manpower and material resources to analyze the data. Pan Ning said that the operation cycle of UNIQLO is weekly. "Monday and Tuesday are the hardest. We have to set up marketing meetings to analyze sales data. According to the consumption situation, see how to change and how to go. Action begins on Wednesday. " What he refers to is the elimination of unsalable goods and quick replenishment of vacant goods.

This system is closely related to UNIQLO's skillful SPA mode (private brand retailer's business mode). This mode is driven by information from the terminal stores: the information that the stores will receive will be fed back to the factory quickly and effectively, and the factory will adjust the production structure immediately, not only to avoid the slow response of multi-layer channels, but also effectively protect the market supply of the best sellers.

Finally, the logistics system. The inventory system under UNIQLO online and offline is completely separate. Logistics mainly adopts outsourcing mode, that is, the third party logistics. They also provide specialized warehousing support for UNIQLO.

　　 pricing strategy

UNIQLO's new product, "time limited and excellent", often makes consumers scream out of sight. The reason is that a garment has been folded for several days, but it will restore its original price after several days.

This makes consumers who like UNIQLO products make decisions more quickly when they are puzzled. "Do not know when to discount, and even when prices will rise, so they will buy without hesitation when they encounter a discount on the clothes they like."

The analysis results of different industry analysts show that the frequency of the price reduction of UNIQLO can reach the fastest time in weeks, and the price range covers 10% to 40% of the total products. From a shelf to a clearance, a product will usually go back to the original price stage after two price cuts, and the final price will be sold until it is sold out.

However, UNIQLO told reporters that the price reduction is not fixed. In terms of category, it will choose seasonal popular products to carry out promotional activities such as time limit and special promotions. Sometimes it will consider the weather and geographical factors to set up promotional activities. The aim is to give consumers a "pleasant surprise".

This strategy is relatively easy for the consumers of the physical store to accept, and for the users who are accustomed to the crazy discount, the UNIQLO library will inevitably be criticized. For example, many online shopping consumers often give bad reviews because of the price, such as "just buy, cut prices, not honest" and so on.

However, UNIQLO did not change the price reduction rules because of opposition. As time passes, consumers have formed such a habit of consumption: early buying, early benefit, and late buying.

"This sales strategy UNIQLO has been used for many years. UNIQLO's research on shoppers' psychology has reached a very detailed level, which is also a unique retail technology. Cui Hongbo, founder and chief executive officer of Shanghai brand management consultant Co., Ltd. analyzed, "this irregular discount way can attract customers to repeat shopping times and form stickiness, and the other advantage is to enable customers to make quick turnover in a specific period."

According to Cui Hongbo analysis, shopping malls and retail outlets tend to be light and prosperous every day, such as shorter trading cycles in the morning, fewer queues, and more queues in the afternoon.