Shoe Industry Representative Brand Performance Has Declined, What Is Wrong?

The advent of the Internet era has deconstructed the survival environment of traditional industries, and let traditional enterprises do not know where to go. The shoe industry is one of the most representative industries.

China is the largest shoe producing and exporting country in the world, and has trillion output per year, but the country is 400 billion a year.

When the inventory is to be cleaned up, the performance of a series of representative brands such as BELLE and 361 degrees has declined. What has happened to the shoe industry? How to get out of the cold winter? Lang Xianping, a famous economist in China, has made the following wonderful analysis recently in the summit forum, "breaking the Bureau - how traditional enterprises embrace the Internet".

The railway freight turnover in the first half of 2015 decreased by 11.5% compared with the same period last year; thermal power generation decreased by 3.1%; industrial electricity consumption dropped by 0.8%; the number of retail sales of all the major large retail enterprises in China increased by only 0.9%, the lowest in previous years; the number of key retail enterprises in the first half of the year reached 240, a record high, such as Tesco supermarket, bu bee lotus, ocean department store, Parkson Department store and so on. At the same time, sales of high-end consumer goods such as luxury goods and automobiles also plummeted.

The economic downturn has become an indisputable fact.

Affected by the economic cold wave, the shoe and clothing industry also went bankrupt.

At present, there are four industrial clusters in China. They are coastal Wenzhou, Taizhou, Quanzhou, Jinjiang, Guangzhou, Dongguan, Chengdu and Chongqing.

Painful experience, why is it a traditional population consuming country?

Why is it so bad? Professor Lang attributed to China's 99% shoe industry chain as "6+1 mode".

The traditional footwear industry "6+1 mode" for product design, raw materials procurement, warehouse pportation, order processing, wholesale business, terminal retail + manufacturing.

1, product design: homogenization is serious, followed by imitation, lack of originality.

2, warehouse pportation and order processing: pportation needs a long cycle, headquarters product warehouse - third party logistics - regional distribution centers - sales outlets, unable to respond quickly to order needs; high inventory, 400 billion yuan a year, shoes and clothing inventory to be cleaned up.

3, manufacturing links: high cost of labor, Dongguan enterprises survival report survey shows that 150 enterprises, nearly 90% of the cost of employment of footwear enterprises are rising, nearly half of the respondents' employment costs rose in the 10% to 30% range.

The profit of the enterprises with a decline in orders is 69.34%, and 32% of the enterprises are losing money.

4, terminal retail: shoes prices are high, profits decline.

The cost will increase by 1 US dollars, and the retail terminal will rise by US $4-5.

Daphne's profit fell 95.4% in the first half of 2015.

Net profit fell 18.91% on the first half of 2015 on Saturday.

To sum up, the original 6+1 industry chain makes the shoe industry into a dilemma and needs to seek change.

1, reduce inventory invalid.

In 2012, Li Ning Co began to clean up its stock, "crazy discount". Stock began to decline: 50 percent off of ordinary shoes, 12% off of new shoes, 80 percent off of outlet stores, but in 2014, inventories rose again.

2, do electricity supplier to inventory invalid.

The major brands use the network platform to carry out inventory clearance, but the result is not ideal.

For example, Daphne began to set foot in the e-commerce market in 2006, and began to establish Agel Ecommerce Ltd in 2009.

In 2014, Daphne laid off nearly 300 employees at Shanghai headquarters, and 3 directors of the electricity supplier department were laid off.

And in June 3rd of this year, Taobao opened the "China made" sales venue, and set up a selling platform for the high quality international high-end foundry's own brand.

The sale period was closed in only 3 days. The ten traditional footwear manufacturers in Dongguan who participated in the "China made" activity sold only 30%-50% stock, and sales were far less than expected.

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1, take BELLE as an example: BELLE constantly optimizes the 6+1 industry chain, for example, design is in line with international standards, brand leads fashion, highlights comfort, fashion and diversification.

For example, BELLE introduced Spanish technology in 2003, by changing the center of gravity of the sole of the heel, reducing the pressure of the forefoot and increasing the comfort, so that the high heeled shoes are no longer painful.

Each of its own brands will launch more than 1000 new shoe styles every quarter to meet diversified needs in a large number of ways.

The procurement of suppliers was quantified, and the five suppliers accounted for 56% of the total purchases, reducing raw material prices and raising gross margins.

2, manufacturing: electronic shoe last design system, automatic production shoe cutting style, small batch production, 20 days listing.

3. Warehouse pportation:

4, order processing:

Even though many efforts have been made, the performance of BELLE, the leading shoe company, is still declining.

It can be proved that the traditional 6+1 industry chain patch is not enough to reverse the decline of the whole industry.

The January 20, 2015 Bain consultancy report shows that Chinese consumers' preferences for luxury goods have changed, and consumer groups have been significantly less loyal to brands and fanaticism. They are no longer superstitious in advertising, endorsement, etc., and pay more attention to user experience and word of mouth.

Nowadays, consumers have the following characteristics: first, younger.

Pay more attention to design sense, fashion and trend.

Second, maturity.

Brand preference is diversified, exclusive, and does not require obvious brand identification.

Third, specialization.

More and more consumers are seeking a full range of experiential luxury goods, such as products that are collaborated with designers.

The original "6+1chr (34)" mode has been pformed into order processing, product design and manufacturing, raw material procurement, terminal retail, and the removal of warehousing, pportation and wholesale business links. The integration of design and manufacturing is the way of pformation.

1, order processing: ten thousand shoe merchants use 3D foot type measuring instrument to collect big data, and produce shoes with different last shapes according to the feet of different regions, so as to achieve the goal of matching the demand of local population and make users more comfortable.

In addition, Wan shoe merchants are testing a private custom system. Users only need to leave 3D foot data, and they can choose their own fabrics, outsole, color, shoelace, special logo, etc.

After receiving the order, the system will pmit the personalized demand to the factory and upload it to the cloud as the basis of consumer preference, so as to facilitate the factory to design a more fashionable and popular style.

2, product design and manufacture: after receiving the order information, the factory can design electronic shoe last according to the 3D data of each foot, and it will be shaped at one time.

3, raw materials procurement: Wan shoe merchants through the integration of the industrial chain.

Shoes, hardware, accessories and other large quantities of procurement, to achieve low-cost procurement, control costs.

4, terminal sales: entity experience shop for experience rather than sale, offline experience, online order, through mass products F2C (factory to consumer), cut off the intermediate links, ensure product high performance price ratio, and the realization of big data personalized customized shoes are equally quality and price, close to the people.

The essence of Internet + is to make inefficient links efficient and unreasonable parts become reasonable.

Professor Lang firmly believes that traditional industries can only have a way out by greatly reducing costs and improving efficiency through Internet tools.

The pformation of 6+1chr (34) mode to 4+0chr (34) mode puts forward high requirements for the traditional industry's own innovation, and it also has important reference significance for other industries.