Bosideng: The Key To Solve The Problem Is To Reduce Costs And Improve Quality.

Its share price has fallen from HK $1.2 per share at the end of May last year to HK $0.62 at the end of June 2nd this year, and its market value is HK $4 billion 961 million.

In January of this year, Bosideng announced that Gao Dekang, chairman of the board, took the stake of the Gao family holding company as the subject matter, and raised 24 billion yen (about 1 billion 424 million yuan RMB) to Itou Chuwa Citic Asset Management Corporation Ltd to solve the urgent problem of capital.

Since the company's performance began to decline in 2013, Bosideng is now in the country.

The industry has been a big ship's long-standing problems, the company's intricate management situation leads to enterprises turning around difficult.

This business case explores the deep reasons for Bosideng's dilemma through interviews, and hopes that the Chinese garment industry once again can rise again.

Product style less difficult to block the trend of impact

In the town of Bai Zhen, Changshou City, the 21 floor Bosideng headquarters building stands alone in Bosideng Industrial Park. From height, it is much larger than the surrounding buildings.

The newly completed modern building was put into use in 2014. It can be regarded as the highest landmark in Changshou City.

However, this splendid building can only represent Bosideng's achievements in the past. In recent years, the company's performance is declining rapidly, and enterprises are facing many challenges.

Data show that: in 2013, the company's performance reached its peak, with a revenue of 9 billion 325 million yuan and a net profit of 1 billion 79 million yuan, and its performance has been declining year by year.

In 2014, Bosideng revenue was 8 billion 234 million yuan, down 11.7%, net profit 695 million yuan, down 35.6%; in 2015, revenue was 6 billion 293 million yuan, down 23.6%, net profit 132 million yuan, down 81%.

This year, if the industry does not expect it, there will probably be a two digit decline in revenue.

"Clothing sector inventory is generally about 20% of revenue, calculated by Boston's 2013 revenue of 9 billion 300 million yuan. In 2014, the company faced 2 billion yuan of inventory pressure," senior planner Lu Shengzhen analyzed. "2 billion yuan inventory will have to be resolved for at least a few years, but as the performance continues to decline, the inventory pressure will increase year by year, and the pressure of funds can be imagined."

According to the information released by Bosideng, after adjusting, the total inventory of Bosideng in 2015 will decrease by two figures compared with that in 2014, but it will still reach 1 billion 910 million yuan.

This also explains why Bosideng raised 1 billion 500 million yuan in January this year by the big shareholders coming to Itochu and CITIC Asset Management Co.

As early as the middle of last year, Bosideng's major shareholder proposed to invest and expand the shares to Itochu and CITIC Asset Management Co, but the result was rarely opposed by small shareholders. However, the pressure of capital made Bosideng have to bypass the minority shareholders to continue the financing plan.

In fact, not only Bosideng, since 2010, the entire clothing industry in China is facing a strong cold wave. The rapid contraction of sports clothing brands such as Lining is proof.

"The latest news is that there are 2849 stores.

At the price of sale, the clothing brand which was once very popular in the 90s of last century is priced at only 250 million yuan, and the recession of domestic clothing brand is obvious.

Wei Gang, who is familiar with the brand operation of Bosideng and other down garments, is commented on.

Faced with the complicated market situation, how did Bosideng's decision-making level summarize the experience of the enterprise? In mid May 2016, Gao Dekang, chairman of Bosideng, briefly answered the questions raised by reporters at the 21 floor conference hall of Bosideng headquarters.

Gao Dekang said that the company's primary problem is to reduce costs, such as reducing management costs, implementing flat management and so on.

He emphasized that on the one hand, to ensure the quality of down garments, on the other hand, it is necessary to innovate in the style and improve the quality of products.

"Style is the key issue of Boston."

Lu Shengzhen analysis, "style aging, style is too single is the main reason Bosteng is in trouble."

Before and after 2010, the shock wave of fast fashion brands abroad shocked and scared all the clothing brands in China, because it shook the traditional concept of the domestic garment industry.

"The success of the domestic market includes two European brands and two Japanese brands, and their massive entry has shocked all domestic clothing brands."

Wei Gang said the four brands came from Europe's ZARA, H&M, and UNIQLO and MUJI products from Japan.

Take ZARA as an example, although it is a world-famous fast fashion brand, it is not entirely suitable for comprehensive comparison with functional clothing Bosideng, but the rough comparison between the two data is still convincing.

ZARA, headquartered in Spain, was established in 1975, but has become the world's third largest clothing business. Its killer is to keep up with the trend of "fast".

The small batch and multi style production mode makes ZARA a benchmark for the clothing industry. Its stores not only change two product styles every week, but also a garment will not be placed in the flagship store for more than two weeks.

{page_break}

Although ZARA generally does not advertise, advertising accounts for only 0.3% of sales per year, far below the average level of industry 3%~4%, but the huge number of SKU makes up for this deficiency.

Data show that ZARA can launch more than 12000 designs each year.

Although it is not clear how many styles of ZARA put into the down jacket every year, but as an important category of winter clothing, ZARA has a few styles of down garments sold in the 4 months of winter sales.

And how many styles of Bosideng's down jacket is released every year? A Bosideng data can be found, and the company runs 6 brands and 11 series products, and launches about 200 personalized feather clothing products every year.

"Bosideng down jacket has 200 SKU launches every year, which is quite a number of domestic companies. But these 200 SKU are too few and too slow in the era of" small amounts of money and rapid iteration ".

Wei Gang commented.

In the Museum of Bosideng headquarters, there are several "brilliant" samples. One of the red down coats is the sales champion of bostenden over the years. In 2006, it sold 1035976 pieces. Another dark blue down jacket was runner up, and in 2007, it sold 890497 pieces.

No doubt, these styles tell about the glory of Bosteng, but this era is gone forever.

These clothes can be used as historical souvenirs on the exhibition stand, but they do not make any sense for the rapid change of the style.

If Bosideng can not completely bid farewell to the past production and operation mode, and learn fast fashion brands to walk on small batch and multi style roads, this big ship is still very difficult to get out of the predicament.

Wei Gang analysis.

600398.SH is one of the few and rapidly rising garment enterprises in China in recent years. It emulated the advantages of foreign fast fashion enterprises such as UNIQLO, and Hai Lan's home made a success with the relatively weak men's clothing as the breakthrough point, with the characteristics of small batch production, rich style and full coverage of men's clothing.

The annual report of Hai Lan's home 2015 shows that the down sale of the enterprises only reached 1 billion 426 million yuan in that year, an increase of 31.75% over the same period.

In 2015, Bosideng, which produced 32 million 800 thousand down coats and produced more than 1/3 of the national down jacket, reached a profit of 4 billion 80 million yuan in the year when it was at its peak, which was 32.6% lower than that of the same period last year.

In contrast, in boatwear, Bosideng, known as the "king of feather clothing sales" in China, is still three times the sales volume of the Hai Lan family, which is fully covered by men's clothing.

Manufacturing industry complex causes manufacturing to become "heavy assets"

Besides bostbrand, Bosideng eiderdown has three brands: KangBo, Xue Zhong Fei and Bing Jie.

Bosideng is quite different in positioning these brands.

Kang Bo is positioned as a simple style of down clothing, showing the meaning of leisure; snow is positioned as an outdoor sports brand, and ice is positioned to reflect the trend and fashion.

But in fact, in the industry view, these four brand operation teams and operation mode are almost the same.

In view of these four brands, Bosideng set up six production bases in China, namely Bosideng down garments Co., Ltd. in Changshu, Jiangsu, and snow flying Garment Co., Ltd.; Bosideng Garments Co., Ltd. located in Gaoyou; Bosideng industrial development limited company in Sihong; Bosideng Garment Development Co., Ltd. in Xuzhou and KangBo Industrial Development Co., Ltd. located in Shandong Dezhou.

The 6 production bases, which were built by Bosideng, built a stronger manufacturing system than Boston. The importance of Bosideng's clothing manufacturing industry is evident.

Bosideng's attention to industrial production comes from the founder Gao Dekang's entrepreneurial experience.

Gao Dekang was the first self-employed businessman who went to sea to do business after reform and opening up. In 1976, he set up an independent sewing group with farmers in the same village to engage in garment processing and production.

Before the creation of Bosideng brand from 1976 to 1992, although Gao Dekang established his own business and had his own factory, he continued to do business for large garment enterprises.

Its OEM companies include "Christmas" and "Xiu Shi Deng" at that time.

It is this long-term foundry experience that lets Gao Dekang put garment manufacturing in the most important position of the enterprise.

"In a few days, I will go to CCTV to give a speech, telling consumers what the quality of feather is and what kind of duck down is best."

Gao Dekang told reporters.

He insists that grasping the quality of production is the most important part of getting out of the predicament. As long as the consumers know that the quality of bostin's down jacket is the best, they will choose bostin.

But in the view of the clothing experts, there are some misunderstandings.

"The new clothing strategy theory tells us that the best quality product is not the best choice, and the best is the best."

Wei Gang commented, "from the 80s and 90s of the last century, the Chinese garment enterprises were developed by production, and they were basically dug their own first bucket of gold, and the investment and production became their difficult feelings.

But the times are changing, now a large number of successful foreign light assets enterprises show that for clothing enterprises, the value chain has a smile curve, "design and brand, channel and sales" is the two link of the highest profitability, the most important is to seize the two core of the design and sales, as for production, this low profit link may be outsourced, because the market has a rich production and manufacturing resources.

{page_break}

Metersbonwe and other domestic apparel enterprises, foreign ZARA, H&M and other fast fashion companies are operating in this way, other big clothing enterprises in the world are basically operating this way.

The proportion of their production outsourcing is over 50%, and some even 100%.

Take ZARA as an example, the ZARA built in 1975 was mainly produced by itself at the very beginning, but with the increasing scale, it has been pformed into more and more outsourcing production.

Statistics show that ZARA has 22 factories in Spain, and about 50% of its products are completed through their own factories to ensure absolute speed.

The remaining 50% of the product ZARA is outsourced to 400 small processing plants to produce, and a factory produces only one style, which ensures the specialization of production and the high speed of delivery.

H&M, who started in Sweden, simply gave up its own production. The company completely outsourced production to 700 suppliers, which are distributed in Europe, South America, Asia and Africa.

H&M also adopts a dual supply chain strategy: to manage production through different supply chains.

The rapid response supply chain composed of European suppliers requires the delivery of the shortest time delivery to the supply chain production. The shortest delivery can be completed in 3 to 4 weeks. Another supplier chain is composed of Asian suppliers, and the basic products, the long delivery cycle, and the products with high cost and high quality can be delivered to the supply chain. The suppliers are mainly in China and Bangladesh.

For domestic enterprises, a well developed enterprise such as Hai Lan home has achieved 15 billion 800 million yuan revenue in 2015, which is more than two times that of Bosideng. Its mode is also a light asset mode, and production mainly relies on outsourcing.

In 2009, there were 129 suppliers from Hai Lan home, and 239 in 2011.

According to the data of the enterprise information center of the National Bureau of statistics, since 1995 to 2007, Bosideng's down jacket production has always been the first in the country. The question is, will such a large quantity of down jacket be given to other enterprises for outsourcing production, can the quality of the products be guaranteed?

"Although Bosideng's down jacket is large, it is no problem to outsource most of it to domestic enterprises, which is very beneficial to the management of the company, and also helps the small garment enterprises to survive. Why not?" the chairman of the Shenzhen Jin Jian Garment Co. Ltd.

There are two reasons for the conclusion of Lou Baijin. The first reason is that there is no complicated technology in the down jacket. For many domestic manufacturers, the technology is already very mature.

Second, it is impossible for enterprises to go all the way. If Bosideng avoids the management of its huge production chain, it can put more energy into the management of the design and sales chain, and concentrate on financial resources and material resources to enhance the core competitiveness of the brand.

"At the moment, the impact of the electricity supplier on the garment industry is also very large, which makes the down garment industry more competitors. They may not need to produce many down garments, but they can be sold through the Internet."

Floor hundred gold introduction.

Data show that although the competition environment of domestic garment industry is deteriorating, the down garment production enterprises are not going down.

According to the statistics of China clothing association, in 2006, there were more than 600 down garment production enterprises in China, which increased to 1051 in 2011 and increased to 1366 in 2015.

Industry estimates that this year's domestic down jacket manufacturers close to 1400.

"However, the increase of down garment production enterprises is creating opportunities for outsourcing of large down garment production enterprises. Large domestic garment enterprises such as Bosideng should seize the opportunity to pform, and why should they focus on the manufacturing industry?" Lu Shengzhen, senior garment industry planner, commented.

In fact, Bosideng's emphasis on industrial issues may not only be the case.

Bosideng production chain also has a large number of OEM business, which accounts for a large proportion, and with the decline of the company's performance, OEM business is increasing year by year, close to 20% of revenue last year.

This situation is hard to imagine in the international brand. Is it a brand clothing enterprise that takes the business of other brands as the main business?

According to Bosideng's annual report, the OEM business income of the company in 2015 was 1 billion 202 million yuan, an increase of 36.5% over 2014, and its share in revenue increased from 10.7% in 2014 to 19.1%.

In Bosideng's view, the growth of foundry business slowed down the declining trend of enterprise revenue, and supported the annual report's performance. It is a matter of celebration, but it does not seem to be the case in the industry.

"OEM business is actually a double-edged sword. The bigger it is, the more powerful your competitor will be, and the smaller your market share and the less profit it will be."

Wei Gang commented.

Layout is better than steady attack.

Considering that the sale of down garments can only be achieved in the two season of autumn and winter, and that there are no products available for sale in other seasons, Bosideng began to expand in areas beyond the down jacket, which is called the "four seasons" strategy in Bosideng, in 2009.

It would be a short list to list the brands that Bosideng created and acquired outside the down jacket in recent years.

In May 2009, Bosideng bought a wholly owned Bosteng men's brand Jiangsu Bosideng Clothing Development Co., Ltd., and entered the field of men's wear. The latter was Gao Dekang's son Gao Xiaodong.

In May of the same year, Bosideng participated in the sales of Rocawear, a street corner brand in the Greater China region.

In 2010, Bosideng founded a women's clothing brand Rui Qi.

At the beginning of 2011, Bosideng had owned 51% stake in Mogao brand and 51% of Shanghai's Rambo children's products by expanding its capital and expanding its stock to expand the business of casual wear and children's wear.

In October of that year, Bosideng bought Jesse International Holdings Limited for 892 million 500 thousand yuan and entered the field of women's wear.

In July 2013, Bosideng invested 150 million yuan to invest in Shenzhen women's clothing and got 30% rights and interests.

Despite frequent attacks on the four seasons, the effect of Boston is not ideal.

In March 2012, Bosideng terminated its business, and pferred its 51% stake in Rambo company to Rambo management, at a price of 10 million 400 thousand yuan.

In the second half of 2014, Bosideng gave up its own women's clothing brand Rui Qi, Bosideng said in its 2014 annual report: "the group plans to terminate the clothing brand with poor profitability and let group resources concentrate on core business."

{page_break}

The rest of the brand is not optimistic.

Take Bosideng men's clothing as an example, the men's wear sales exceeded 500 million yuan at the highest time, and then fell down all the way.

In 2014, Boston menswear had a sales volume of 478 million yuan, down to 276 million yuan in 2015.

Men's clothing is still the best in Boston's four seasons strategy.

In 2015, the overall sales of Bosideng non down garment business dropped from 1 billion 300 million yuan in the previous year to 1 billion 11 million yuan, with a 22% decline.

In the first half of fiscal year 2016, Bosideng non down wear business continued to decline by 6.4%, of which men's wear, Mogao and other businesses were on the decline, men's clothing was down 12%, Mogao's decline was 21.9%, and other non down garments business was down 22.2%, only Jesse rose 18.8%.

It is not too late to work, and it is expensive. Why does Bosideng's four seasons strategy work so badly? In this regard, Gao Dekang admits to reporters that the experience of mistakes is that he has not made plans and has not chosen a good team.

First expansion and contraction will inevitably lead to the turbulence of enterprises and the dispersion of people's hearts.

Did you choose a good team or didn't you trust the team?

"Every family in the family can not be twisted into a single rope, and it is the fundamental reason why Bosideng is unable to bring in and retain talented people to attack others and new recruits for their own interests and spheres of influence."

A business manager who left Bosideng due to the failure of Bosideng's four seasons strategy described the phenomena in Bosideng.

For the mistakes in Bosideng, Lu Sheng Zhen also concluded that he was not sure about the brand before the acquisition.

"One is the channel, the other is the team, including the design team and the speed of the design is very critical, especially the women's clothing."

Lu Shengzhen thinks that if women make clothes and do fast fashion, if the design speed is not enough, the stores will not be able to support them, and the performance will drop sharply after that.

In any case, the expansion of Bosteng hastily left a bad result for himself.

Shenzhen Jin Jian Garment Co., Ltd., chairman of the building 100 Jin believes that the four seasons of Bosideng is not a strategic issue, not a tactic, the biggest problem is to attack everywhere but not to highlight the key.

"Bosideng is also very helpless, because the genes of down jacket are obviously different from those of other garments. Bosideng has no talent and team reserves to leave the down jacket to expand other clothing categories."

Lou Baijin believes that the clothing industry market is very thin and very professional. You are the leader of men's clothing may not be able to do a good job of women's clothing brand, women's clothing is not the best brand of casual wear, good at fast fashion is difficult to do luxury goods, good at luxury goods may not be able to do fast.

"Bosideng is not careful in choosing the direction and attacking all over the strategy, which distracts energy, and it is very likely that no one can catch it."

Building hundred gold analysis, "in any field of clothing to create a brand takes a long time and continuous input, Bosideng should combine their own advantages and characteristics to choose a breakthrough, choose to insist.

If Bosideng can't get the time and energy to stick to the brand chosen, it is better to stick to the industry and forget about the down jacket.

Indeed, many brands that Bosteng chose at the time did not give up, such as their own women's clothing Rui Qi, such as foreign brands Luo Luo Wei Er and children's wear brand Rambo.

Statistics show that Bosideng not only expands everywhere in the garment industry outside its down jacket, but also involves many industries outside the clothing industry.

It is understood that Bosideng's revenue reached 28 billion yuan last year, while the clothing business income listed in Hong Kong was 6 billion 293 million yuan.

However, Gao Dekang has always insisted that Bosideng's main business is clothing, which has not been invested in real estate and other popular industries these years, and is sticking to its main business.

It is understood that other businesses besides Bosideng garment industry include Yi Yu expressway, Dezhou Regal Kangbo Hotel, Changshu Bosideng Super 8 Hotel, Jiangsu KangBo industrial solid waste disposal Co., Ltd., and Bosideng International Building research and development center in Shanghai Yangpu.

Positioning Brand Aging serious market positioning contradictions

Bosideng insists that the longest season brand is Bosteng Menswear, but the brand has also been losing money.

For example, in 2012 Bosideng men's clothing sales income of 480 million yuan, and in London in the United Kingdom to invest in flagship store in the market to spend 20 million pounds, plus the renovation cost nearly 300 million yuan, the loss is obvious.

Lu Shengzhen said that insistence on men's wear became a rare case of Bosideng.

Although Bosideng has invested huge sums of money in promoting men's wear, Lu Shengzhen believes that Bosten's men's marketing strategy is not right.

"Bosteng men's clothing abroad costs a lot of money to fight for international brands, but domestic stores are in the two or three tier cities, so that consumers in the first tier cities are very confused."

Lu Shengzhen analysis, high-end consumers consider Bosideng men's positioning is the two or three line city brand, naturally will not condescend to buy.

The original positioning of high-end Bosten men's clothing, if only through the domestic investment and wholesale development to open up the market, positioning will naturally fall below the middle end.

"Now, the market of Bosteng men's clothing has been confined to the northern cities of Hohhot and Taiyuan. Can such high-end brands do it?" Lu Xin Zhen questioned.

{page_break}

Wei Gang believes that Bosteng men's failure has two main reasons: first, the aging of Bosideng brand has seriously affected the brand of Bosteng men's clothing. Consumers will think that the latter is a brand similar to that of Bosideng. The second is that with the increasing anti-corruption efforts in the country, the turnover of men's clothing brand is falling rapidly, and the positioning of men's clothing seems to be more suitable for the civil servants aged 45 or so.

"Someone once asked Bosideng management to change the brand to" B&D ", from a shirt of more than 500 yuan to a moderate price, from 200 to 400 yuan, which is similar to the price of G2000 of Hongkong clothing enterprise, and produces relatively fashionable style, and moderately differentiated to avoid the negative influence of Bosideng brand aging.

But Bosideng's policymakers did not adopt it.

Wei Gang introduced.

Bosteng men's contradictions intensified the result of the backlog of goods, the price is greatly reduced.

Recently, Bosteng men's clothing has been sold on TV direct sale, and T-shirts and shirts have been reduced to 398 yuan and four pieces.

"However, the general direction of the four seasons strategy of Bosideng should be correct.

Continuing to insist on men's clothing is still right for Bosteng. The failure of the past is even a costly tuition.

Lu Sheng Zhen commented, "after all, Bosteng men's clothing has been accumulated through some years' huge money promotion and has gained some popularity. In the future, if we can find a suitable channel mode, brand mode and a good team, we can still do it."

He said it might be helpful to consider some unconventional brand marketing methods.

For example, the spirit of jewellery is an example of successful marketing with the help of TV drama "carat lovers".

The reason for the failure of the "four seasons" is the lack of planning to visit Gao Dekang, chairman of Bosideng.

Bosideng clearly declared the strategy of four seasons and opened up the field beyond the down jacket for at least seven or eight years. Gao Dekang, chairman of Bosideng, participated in the two sessions this year. He also indicated that the proportion of non down jacket business would be raised to 50% in the future.

But in fact, Bosideng's strategy of four seasons has been frustrated. According to the semi annual report up to September 30, 2015, the income of non down garment business is 393 million yuan, down 6.4% from last year.

It accounts for 15.3% of total business.

It is far from the past plan.

In mid May, in Bosideng's 21 floor building in Changshu headquarters, Gao Dekang accepted an exclusive interview with reporters and made a brief summary of Boston's management twists and turns in recent years.

Planning for future mergers and acquisitions

Reporter: now the clothing industry is facing difficulties. Many businesses are closing up and cleaning up their stocks. Bostin closed thousands of stores last year. What do you think are the reasons for the difficulties?

Gao Dekang: competition has intensified.

One reason is that the original clothing enterprises do not know much about down garments. Now more and more, and some enterprises that do summer clothing and spring and autumn clothing have begun to make seasonal garments, and they have entered the field of down garments.

Another reason is the participation of e-commerce providers.

The original down jacket is hundreds of thousands of enterprises are doing, now has the Internet, some enterprises only do tens of thousands of pieces each year can be sold.

Inventory is a problem that many enterprises are facing. There is stock pressure. As long as we digest the inventory, we must reduce the income, because the price of products should be reduced.

That's why so many corporate performance is bad.

But in any case, I believe that quality is the life of the down garment enterprise. Eventually, we will recognize the brand, not just buying a brand.

This year, I will go to CCTV to give a speech to explain what is good down clothing and what is good duck down.

Reporter: Bosideng has been doing the four seasons for many years, and the result is not obvious. What experience do you think you can sum up?

Gao Dekang: I think planning is not done well. After that, the action must be slow, the steps must be in place, and the talent can be done in place.

This requires that planning must be done beforehand, and planning must be carried out, otherwise it must not be done.

In addition, teams should be implemented, and they should have responsibilities. No team would rather not.

Reporter: Bosideng has been involved in men's wear, women's wear, children's wear and casual wear field. Is this a long battle? We've cut off brands such as Rui Qi and Luo kvir. Does this mean that we will choose the key direction of four seasons in the future?

Gao Dekang: we will not give up all of these fields.

The key is to have the right team and do it.

I think Bosideng is just a platform to operate any clothing items on this platform.

{page_break}

The key to solving difficulties lies in reducing costs and improving quality.

Reporter: what are the reasons for the continuous decline of Bosideng's performance? What are the ways and measures?

Gao Dekang: I think the first reason is cost. We should reduce costs, such as flat management and lower management cost.

Because management is not the first line of production design.

Second, we need to ensure and improve quality.

Bosideng attached great importance to quality. Of course, improving quality includes improving the fashion of products and innovating in design and creativity.

My feeling is that we should be an enterprise of the times. The enterprises of the era mean that clothes are to be worn by the people of the age. Therefore, we should use young people to be the enterprises of the times, because they understand the times and are different from ours.

Reporter: last year, you once again took over the company from the professional manager and took charge of the management of the company. Do you have the idea of choosing a professional manager again?

Gao Dekang: I intend to take a good team, stand the last post, use 3 to 5 years to set a strategic direction for the enterprise, this is what I think is the most important thing.

I want everyone in the enterprise to know what we are doing now and what to do in the future. This year's problems must be solved next year.

It is very important for an enterprise to plan every year and implement it every year.

Reporter: what are your reflections after taking over the company again?

Gao Dekang: in the past year, I can say that I sink and concentrate on the electricity supplier.

Bosideng used to do pretty well in the electricity supplier, but I feel there is a change now.

Originally said B2C, that is, you sell products to individuals on the Internet, now become C2B, that is to say, the products you produce must be carried out according to the needs of consumers. I think this is the biggest change.

Observe that garment enterprises should be good at grasping the changes of the times.

Bosideng began to rise in 1995 and became the overlord of the down garment industry. It became the benchmark of the domestic garment industry. It once held the title of "China's most brand value clothing enterprise" and "the most valuable garment enterprise in China".

In the early history of Bosteng's pioneering work, he also experienced the fate of almost bankrupt.

It was in 1994, when Bosideng blindly expanded production and loans to banks 8 million yuan, resulting in a large backlog of products, inventories reached 20 million yuan.

Gao Dekang first took advantage of the anti season selling method in the clothing industry, and in 1994, he left the stock at the Wangfujing department store in Beijing at the turn of spring and summer.

It is said that the 5 million yuan payment was recovered by Gao Dekang. Although it only recovered the 1/4 of the stock, it ensured that the enterprise returned the loan and passed through the difficulties.

In 1996, the enterprise sold over hundreds of millions of dollars.

The most beautiful battle of Boston is between 2003 and 2005.

During this period, Bosideng put a lot of TV commercials to win the CCTV king.

According to the data released by the media at that time, the advertising cost of Bosideng around 2003 was 130 million yuan, 180 million yuan in 2005, and 220 million yuan in 2009.

In terms of output, Bosideng's turnover in 2003 was only more than ten billion yuan.

"The private enterprises in Jiangsu and Zhejiang have much more business vision than state-run enterprises and enterprises in the north, but they dare to take out 10% or even 20% advertisements of their revenues."

Lu Shengzhen, senior planner of garment industry, is deeply touched.

Bosteng's early competitors and many, for example, in the 90s of last century, there are Jiangxi duck, Beijing iriran, Hebei snow Chi, Shanghai's feather and upper feather, and so on, the victory of advertising war made Bosideng finally throw off her opponent.

Recalling the past, Gao Dekang is always pouring out. He is accustomed to taking lessons from the way he has gone through and solving the problems faced by the enterprises.

For the reason why the enterprises could win in the fierce competition at that time, Gao Dekang thought that the first thing was to seize the quality of the products. The second was to make innovations in the use of pigments, and took the lead in the use of imported matte pigments instead of the brightly colored pigments made in China.

Decades of ups and downs have brought valuable wealth to China's first generation of entrepreneurs such as Gao Dekang, giving them plenty of experience and perseverance in the face of setbacks.

But the key to Boston's problem is that it is not enough to reflect on enterprise management only from its own experience and find the direction of the enterprise.

Because times change too fast, past successes do not apply to the present.

If we can not look at the enterprise from the perspective of the times, we can not grasp the opportunity at last, and the enterprises will be faced with lagging behind and declining.

Advertising on CCTV is a killer in the era of fierce competition and lack of propaganda. But now all kinds of publicity channels have been scrambling for it. CCTV monopoly has long gone.

Anti season sales are only tactical means. In the 90s of last century, few enterprises would shake the market if they used them. Now they are overused by clothing companies.

Today, the rapid development of information technology has brought great changes to garment enterprises. This change not only changes the management of enterprises, but also changes the strategy and structure of enterprises.

Take a look at the description of ZARA. In fact, this description of the clothing industry is already familiar.

In terms of the quick response system, ZARA stores sell their sales information to headquarters every day, and send two replenishment orders to headquarters every week based on current inventory and sales expectations in the next 2 weeks.

In terms of distribution.

ZARA's logistics distribution system is very developed. About 20 kilometers of underground conveyor belt delivers ZARA products to the cargo distribution center in La Coruna, Spain. In order to ensure punctual arrival of each order, ZARA uses optical reading tools to conduct product inspection and selects and inspected more than 60 thousand pieces of clothing every hour.

With the help of fixed pport trucks and two air pport bases, the arrival time is: Europe's chain stores 24 hours, American chain stores need 48 hours, Japan is between 48 hours and 72 hours.

Facing the changing times, garment enterprises need to innovate in mode and structure.

If we do not innovate, we will be eliminated.

{page_break}

Hai Lan's house has two characteristics.

One is the home of Hai Lan, which does not produce or participate in the design. Instead, the supplier chooses his design to the sea Lan House to select the next order.

Moreover, if the two sale season does not sell, the supplier must agree to return the goods.

The other is that the franchisee has to pay 1 million yuan to join the fee. After paying the franchise fee, they still need to pay the salaries of the shop assistants. Moreover, they do not need to participate in the management and management of the store in person.

Hai Lan's home promised that the 1 million yuan membership fee will be returned within 5 years.

These two characteristics are controversial in the industry, and there are many people who support and doubt it.

"Some people believe that Hai Lan's home has squeezed suppliers, and they do not bear the cost of inventory, but in fact, many small and medium garment producers in China are still on the edge of bankruptcy. For them, the largest order of retail terminal system is the biggest help, which is a reasonable combination of production resources."

An insider analysis.

On the other hand, letting franchisee pay rent and staff costs and pay large margin is criticized by some industries as a way of financing in disguised form.

However, there are many people in the clothing industry who believe that this is a great innovation because the two or three tier cities have many such resources, the ability to get the best location, the lack of sound investment channels and the integration of these social capital.

Anyway, the strategy of Hai Lan's home is controversial, but it is indeed a bold innovation based on the actual situation in China. This innovation mode may not last forever, but so far, it has helped the success of Hai Lan's home.

What Bosideng lacks is innovation at this strategic level.

"Four seasons" is very important for Bosideng brand itself. Single season products can not effectively enhance consumer brand loyalty and consumer stickiness.

However, the four seasons of Bosideng brand, the other three quarter positioning is just to fill the gap in the season, the idea is wrong, we should base ourselves on training new consumer groups.

Wei Gang commented that "the design and design of down coats should be considered in conjunction with the other three seasons, and the younger generation of products will lead to younger brands."