Clothing Industry Continues To Slump: "Franchise Mode" No Longer Meet Market Demand

Franchised mode enables

The extensive growth of the number of stores has increased the sales volume of enterprises, but has also created many stores with poor operating conditions.

The industry has been going down for four years. Next, let's take a look at the detailed information.

Every year 7, 8, and two months are the six months' report cards issued by listed companies. With the discovery of the first half of the year in 2015, the A apparel industry listed companies began to disclose semi annual reports in July.

With the increasing number of garment enterprises, the market is saturated and the supply exceeds demand. Because of the separation from franchised stores, enterprises are always out of touch with the market, and can not be adjusted rapidly according to the product sales situation, resulting in many commodities on the market, but they can not meet the needs of consumers.

At the same time, due to the accumulation of large quantities of inventory in poor stores, the increase in corporate accounts makes it difficult to develop liquidity funds for new products, and eventually form a vicious circle.

The downturn in the domestic apparel industry began in 2011, and the first year of sportswear sales growth for many years slipped.

Take Lining as an example, data show that in 2010, the company's sales volume was 9 billion 479 million yuan, down to 8 billion 165 million yuan in 2011.

Over the next four years, the downward trend gradually spread.

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In other fields, China's clothing industry has entered a low ebb.

Talking about the reasons for the low garment industry, Yu Xiang believes that the most fundamental thing is that the franchise mode no longer meets the needs of the market.

When the market supply is less than the demand, the franchised store mode makes the number of brand stores grow extensively, which has increased the sales volume of the enterprises, but has also created many stores with poor operating conditions.

While the franchise mode restricts the development of enterprises, Internet brands and foreign brands are also competing for the domestic clothing market.

The Internet brands such as Yin man and Korea have attracted a number of consumers who like online shopping for their high performance price ratio, and these brands have successfully extended to offline stores after being successful online.

In addition, in recent years, foreign fashion brands such as ZARA and UNIQLO have entered China in succession. Their direct mode can adjust their stores and products quickly according to the market, and also firmly occupy some markets while meeting the needs of consumers.

Yu Xiangpin said that the healthy growth of foreign clothing brands is a strong proof, "proving that the domestic apparel industry's downturn is internal and has nothing to do with the slowdown in the world economy."

Xiao Lan, teacher of textile design and Industrial Economics Department of Textile College of Donghua University, also pointed out fourth reasons for the downturn of the garment industry: in the past few years, China's clothing exports were booming, and some of the surplus products were digested. However, with the gradual pformation of export garment processing from China to cheaper Southeast Asian countries in recent years, the problem of the saturation of the domestic clothing market has become more prominent.