The Chinese Market Is The Straits Of The Fast Fashion Group.

From the first home

Since entering China, it has been a long time ago.

The retail market has injected a strong stimulant. Now, the needle is facing an embarrassing situation of failure.

Recently, the GAP group of American apparel retailer announced that its net sales fell by 6% to $3 billion 440 million as of April 30th, and the company's share price has dropped by about 30% this year.

GAP also announced that it will close 75 Old Navy and Banana Republic stores outside North America.

Coincidentally, H&M, the world's second largest clothing retailer, announced that its net profit in the first quarter of fiscal 2016 has shrunk by 29.6% compared with the same period in the first quarter of the year, while UNIQLO, one of the fastest fashion "one sister", has also acknowledged that its net profit of its parent company's fast selling group was down 55.1% in the first half of 2016 fiscal year.

H&M first quarter profit plunged 30% follow-up sales to be observed

H&MHennes&Mauritz AB Hayne Maurice group, the world's second largest clothing retailer, said that because of the group's main purchase market, the US dollar settlement business in Southeast Asian market will weaken in the future by the strong dollar, and may disappear in the fourth quarter. The stock market has surged over 5% in the morning.

In the first quarter of December 1, 2015 -2016, the H&M group's revenue recorded a 9% growth rate based on fixed exchange rate. It was far away from the old rival, the world's largest apparel retailer, Inditex SA Indo Textile Group, and the net sales growth rate of the Inditex SA Indy group from February 1st to March 7th was 15%.

In the first quarter, H&M group's revenue actually recorded an increase of 8.2% to 50 billion 624 million kronor, which was 46 billion 791 million kronor in the same period last year.

During the period, the H&M group's profit after tax was recorded at SEK 2 billion 545 million, or 1.54 kronor per share, compared with 3 billion 613 million Swedish kronor, or 2.18 Swedish kroner, a 29.6% decrease in the same period last year.

The group said the first quarter profit slump was mainly caused by increased purchasing costs and write downs.

Gap releases revenue warning or closes more than 1/4 stores

Clothing retailer Gap Inc (NYSE:GPS) issued a quarterly revenue warning, saying sales in April dropped from $1 billion 210 million in the same period last year to $1 billion 120 million, and sales in the first quarter dropped from $3 billion 660 million to $3 billion 440 million.

Quarterly earnings per share are expected to be 31-32 cents.

Analysts surveyed by FactSet expect earnings per share to be 44 cents, earning $3 billion 540 million.

In addition, Gap intends to streamline its business.

Specifically, the company will conduct surveys on global, but mainly Old Navy and Banana Republic stores outside the North American market.

Last year, Gap announced the streamlining of its retail chain of the same name, plans to close more than 1/4 of the shops, and seems to intend to take similar measures to other clothing chains.

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Half flame and half sea UNIQLO overseas expansion plan shattered

As Asia's largest apparel retailer, fast fashion chain giant UNIQLO parent Xunmei group 2016 has a bad start in the new fiscal year, and its net profit fell sharply by 16.9% compared to the same period last year.

Among them, Japanese domestic performance and overseas market performance based on Greater China were not up to standard, and operating profit decreased by 12.4% and 14.2% respectively.

Affected by this, XXX group also lowered its annual profit and revenue forecast for the 2016 fiscal year.

According to the fast forward group's fiscal year 2014 financial results (as at the end of August 2014), sales in the Greater China region (including Mainland China, Hongkong and Taiwan) for the first time exceeded 200 billion yen (11 billion 140 million yuan) mark, an increase of 66.5% over the same period. The performance data of the Greater China region, known as the engine of growth, greatly enhanced UNIQLO's confidence.

But the expansion of UNIQLO in the US and Europe has been frustrated, and the biggest market in Japan, great China and South Korea has been hit hard by the global warming winter.

Originally trying to dominate the world through overseas expansion, except for the Asian market, its plan for 2020 basically failed.

Fast fashion will erupt price war? Zara India market test water price

Spain's fast fashion giant Inditex group's Zara is starting to cut prices.

According to India market sources, Zara cut prices by 10% to 12% in the past year to better compete with H&M, a fast fashion retailer in India. The commodity price of H&M, Sweden's fast fashion giant H&M, is about 150 rupees, which is about 22 dollars, while Zara's commodity price starts at 33 rupees.

Although Zara is a fast growing clothing brand in India market in recent years, its number of stores is around 100, but sales growth has shown signs of slowing down in one hundred million.

According to the 2015 Trent annual report, the turnover of Zara India market dropped by 23%.

Why is the decline of fast fashion brand declining?

"After 80" has gone, "after 90" is not keen to have been fashionable heights, and why is it now abandoned?

Fast fashion in the past few years, unlimited scenery, entered the Chinese market in 2006 (ZARA in 2006, H&M is 2007, 2010 GAP also came), suddenly in department stores and supermarkets monopoly retail market set off huge waves - at that time, the young main force, "80 generation" people rarely see such a big brand design sense, the price and the people's brand, and the product turnover speed is very fast, to meet the "80 after" people's innovation and change mentality.

But after a flash of 10 years, after 80 years of age entered the age of 30, everything changed.

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Fast fashion trap performance slough reduced to no bottom line discount shopping mall

After sharing the retail market dividends easily, with the lack of brand connotation and the lack of quality charm, they are lost in the fast changing Internet business era.

Min Guangya, a retail expert, said that fast fashion brands are pushing consumers to imitate some of the big brands in a faster fashion. But from the speed point of view, fast fashion is not fast. The so-called "fast" is more like a false proposition. After all, the seasonal pattern of clothing sales is not going to change. With the downturn of global retailing, fast fashion has also lost its immunity.

What's worse, fast fashion offers the risk of discount and inventory clearance, so that it immediately becomes a hypermarket from a white collar fitting room and begins a vicious circle.

At present, fast fashion brands are paying for the "no bottom line discount" behavior.

Due to the continuous discounts throughout the year, H&M and GAP have been branded as "discount anywhere and anytime" in the minds of consumers. The influence of brands is rapidly declining.

Among them, GAP was rated as "one of the 10 fashion brands most likely to disappear in the next 10 years" by Forbes in 2014, forcing GAP Global CEO Jeff Kirwan to speak out.

The Chinese market is the Straits of the fast fashion group.

Although fast fashion brands are shrinking globally, the Chinese market is still a battleground for fast fashion brands. In the case of saturated stores in first tier cities, fast fashion brands are aiming at the two or three tier cities.

While the North American market closes stores and layoffs, GAP is expanding the Chinese market.

GAP said that there will be 40 new stores in China this year.

UNIQLO also said that this year it will maintain 80 to 100 stores in China every year.

H&M expects to open 60 to 80 new stores in China this year.

ZARA, who has opened 166 stores in China, says it is temporarily maintaining a tight and cautious shop strategy. The growth rate of stores in the next few years is between 6% and 8%.

These new shops are mainly concentrated in two or three line cities.

Ma Gang pointed out that in order to maintain the growth of performance, fast fashion brands only expand the number of categories and shops.

When the stores in the first tier cities are saturated, new stores can only be opened to the two or three tier cities.

This kind of channel sink will be faced with the puzzling effect of reducing efficiency.

At this stage, it is neither the best nor the worst.

Xiang Sheng, executive director of Xiang song capital, pointed out that in the background of the downturn in the consumer sector, the fast fashion brand's expansion in the trough period may increase the impact on current profits.