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In China'S Clothing Market: Why Can Fast Fashion Brand UNIQLO Win?

2014/5/15 16:26:00 163

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whether it is expansion speed or market share, UNIQLO is ahead of competitors such as ZARA, H&M and GAP in China, and "positioning the middle class, taking water and soil and understanding the overall situation" is the secret of success of this fast fashion brand from Japan.

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Less than three months ago, Huang Jing, a shop in Shenzhen's Huaqiang North Maoming department store, had no idea that the customer who inquired about the shirt style was the boss of Pan Ning, the Greater China area who came to visit the country.

"is more intimate than imagination, very young."

This is her first impression of the low-key 46 year old UNIQLO Chinese helmsman.

Huang P thought that he would be like most salesmen in the retail industry. He would never see a big boss in his life.

After all, as Pan Ning, senior executive vice president of global marketing group and CEO of Greater China in UNIQLO, more than 16 thousand employees are under management.

Huang Jing did not expect that he would see Pan Ning again in a training session, and thereafter he met almost every two months.

Under P, under the leadership of Pan Ning, an unusual and efficient UNIQLO shop plan is being carried out in the Chinese market.

up to now, UNIQLO has more than 260 stores in China, covering more than 50 cities, accounting for more than half of all overseas stores. The expansion speed and total number of stores exceed those of ZARA, H&M and the fast fashion brand GAP of China's fast fashion three.

over the past year, the company has been running against the market in the economic downturn, reaching the peak of all previous years.

On the day of August 31, 2013, there were 11 new stores of UNIQLO opened at the same time. The largest and newest flagship store UNIQLO SHANGHAI (UNIQLO Shanghai), which has an area of over 6000 square meters, opened a new sales record for Huaihailu Road clothing brand on the same day. In 2013, Taobao's double eleven Shopping Festival, UNIQLO became a billion dollar club, creating a sales miracle of more than 121 million yuan, becoming Tmall's sixth single brand.

"P" before Pan Ning received an exclusive interview with reporters, he just appeared in the communication session of the north market of UNIQLO, and answered the question of how to reduce the turnover rate of salesmen.

Like Huang Jing, 150 graduating students from major universities attended the conference as the future store manager.

This is penning's sixth years to do so.

Every month, he and his vice president will go to the whole country to take charge of two sessions and directly face the exchange of front-line staff.

2013, UNIQLO opened 82 new stores in China and recruited 470 people in the future.

According to the speed of 80 to 100 stores opening every year, UNIQLO plans to recruit 530 future managers such as Huang Jing in this year, and Pan Ning will be directly responsible for the final interview of each of them.

The practice of "P" continues the tradition of Ryui Masa, founder of UNIQLO brand.

In 1995, Pan Ning, who graduated from master's degree, went to Yamaguchi Prefecture from Tokyo. He applied for the interview of the manager of UNIQLO, who interviewed him and asked him questions every month. It was Ryui Masa himself.

the small, pale gray Japanese entrepreneur has a famous saying: "those who can't swim will let them sink."

But in the 2008 financial crisis, Ryui Masa's personal wealth has not shrunk, but with the help of UNIQLO's growth, it has jumped to become Japan's richest man who has been reelected for several years.

The 64 year old Ryui Masachika often said a few years ago: "half of the success of UNIQLO is due to the Chinese market."

"P", the parent company of UNIQLO, the largest apparel retailer in Asia Pacific region, shows that the global sales volume of the XXX group exceeds 10 billion US dollars in fiscal year 2013, and has become the fourth largest apparel retailer in the world.

In the mid-term performance report from September 2013 to February 2014, Xun group again set a record of 764 billion 300 million yen (46 billion 700 million yuan) net sales, up 24.3% from the same period last year.

Fast selling companies said that the growth in net sales was mainly due to strong performance of UNIQLO overseas, with sales in China the largest contribution to total sales growth.

So far, UNIQLO has 600 million products from mainland China every year, and 75% of UNIQLO's suppliers come from China. More than 800 thousand of Chinese are working for UNIQLO every day.

Today, P has become the largest overseas market of UNIQLO.

In March 5th, fast sale Co., Ltd. was officially listed in Hongkong.

This is the first time it was listed in the overseas market after it was listed in Japan in 1994.

Okazaki Ken, chief financial officer of Fast Retailing, said that the main reason for the listing was to enhance the popularity of fast selling group, UNIQLO and its brands in the booming economy of Greater China and Southeast Asia.

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positioning middle class, bid farewell to Waterloo .

but the beginning of UNIQLO in the Chinese market is not wonderful.

Zhang Chunyan is now a loyal fan of UNIQLO.

She thinks that today's stores in UNIQLO have changed dramatically compared with the past. "At that time, it felt like a bargain store."

"P > UNIQLO once suffered from acclimatization in China.

In 2002, UNIQLO entered Shanghai for more than four years ahead of H&M and ZARA. In 2005, UNIQLO moved to Beijing because it withdrew from the Beijing market in less than a year. When it took over the Chinese market at the end of 2005, the Japanese company made no profit in 9 stores on the mainland.

Ryui Masa wrote a book "one win, nine defeats". The title is just like the wrong set of UNIQLO in China.

"P", "I spent months trying to convince them (Headquarters)," Pan Ning recalled to reporters. "We all know that UNIQLO stressed the need to change common sense, but after all, there are still limitations in understanding the Chinese market. It is definitely problematic to do something abroad.

Luckily, I am Chinese and understand China's market. "

Pan Ning suggested that the positioning of customers in the middle class of UNIQLO in China will be a surprise to Japan: no one has ever challenged the slogan of "Made for all" (facing everyone).

"They did not expect that the concept of the middle class is different in two countries. In Japan, the" owner "of Japanese society is all above middle class.

the earliest Shanghai UNIQLO store continued the tradition of "suburban shops" when starting a business in Japan. The store was set up in a low price area, and the shop was furnished with relatively simple layout. The small shop only had 60 square meters.

In addition, under the pressure of high tariffs, in order to maintain a low price positioning in Japan, the products in China's market have all been changed to standards. The gap between product quality and Japanese market is obvious.

Worse still, UNIQLO is also in the mire of price war with other casual wear brands.

"if we face all people, it will inevitably lead us to compete with some local brands such as Giordano, and compete with local brands. Our value can not be maximized, because we are an international brand," Pan Ning told reporters. "So from this point of view, I set the positioning of UNIQLO in the field beyond these brands."

Pan Ning took practical action to persuade Japanese headquarters to accept his orientation of "facing the middle class".

Before taking over the entire Chinese mainland market, the "Hongkong model" created by him has surprised Japan.

In Hongkong, although UNIQLO is positioned in the middle class, its price is also higher than that in the Japanese market, but its gross profit margin is higher than that in the Japanese market.

2005, Pan Ning also put forward "do not adopt Chinese style, but establish the same store as Japan", change commodities and sales to Japanese style, and adjust the price on the premise of guaranteeing the quality of products.

"now we sell on the mainland China is still 10% to 15% more expensive than Japan, which takes into account China's tariffs and other costs.

But we are not trying to raise prices alone, but let the price rise within acceptable limits.

How to let the consumer accept it is to give him the greatest satisfaction and feel it through shopping experience.

Pan Ning told reporters.

In P, 2006, UNIQLO opened a 1000 square meter shop in Shanghai port Hui square, China's best Shopping Mall, and promised customers that everything that can be bought at UNIQLO stores in London and Tokyo can be bought here and new every week.

The store, which has expensive chandeliers and "big money" in decoration, conveys a clear brand personality.

Abandoning the popular line of UNIQLO, it began to convey a more attractive signal than low prices to a new middle class in China: a quality life should be like this.

In 2008, UNIQLO launched its UT series with the global creative people to return to the failed Beijing market and was welcomed by the fashion crowd.

The practice of P has made the brand image of UNIQLO change dramatically.

"The initial success of UNIQLO mainly benefited from cheap Chinese manufacturing and won the price war in the Japanese market."

Retail industry data analyst Yang Qin said.

although China's per capita income is ten times that of Japan, but after nearly 30 years of rapid development, the social problems encountered by developed countries are still the fastest in developing countries, such as population ageing and economic slowdown.

Yang Dayun, President of UTA Fashion Management Group, said: "the continuous economic downturn has made structural changes in Chinese consumption demand. The demand for luxury goods in the rich has decreased, and the pursuit of cost-effective products has increased. Young people under 35 have gradually replaced the older consumers. Their consumption concept is very different. They will not stop spending because of the economic downturn or the decrease in their income.

This has played a great role in the development of China's fast fashion market.