Casual Clothing Brand No Longer Young, Fast Fashion Attack

As the 2016 semi annual report has been released one after another, the achievements of the major listed garment enterprises are also clear.

According to wind statistics, as of August 29th, a total of 40 apparel companies on the A stock market reported half yearly earnings, reporting a total inventory of 34 billion 852 million yuan at the end of the year, while the total net profit was only 4 billion 853 million yuan, and the inventory pressure was enormous.

The same business pressure also exists in Hong Kong.

Brand.

Giordano International (00709.HK) released its semi annual earnings report. As of June 30, 2016, the group's combined sales amounted to HK $2 billion 532 million, down 7% from the same period last year, and the profit attributable to shareholders was HK $204 million, a decrease of 2% compared to the same period last year.

As an old Hong Kong capital

,

It has been highly sought after by post-80s consumers.

However, in recent years, in the mainstream business circles of the first and second tier cities, Giordano has almost disappeared.

In fact, not only Giordano, Baleno, and burglung have once called the three giants of fashion clothing, but their momentum of development is much worse than before. Why are Hong Kong brand names no longer?

The trend of Hong Kong costumes is declining.

Since the 80s of last century, Giordano has experienced birth, growth, popularity and decline.

Public information shows that Giordano was established in 1981, and was listed in Hongkong in 1991, and officially entered the mainland market in second.

For many 70 and 80's consumers, Giordano was once the pronoun of youth and fashion, and the most prosperous business district in the city is always lacking.

The shape of a store.

In 2013, Giordano reached HK $5 billion 848 million and opened 2642 stores worldwide.

However, the good times are not long.

Sales in recent three years have declined to varying degrees. In 2015, the number of outlets decreased by 81, and its sub brand EULA also announced that it had stopped operating.

According to Giordano's performance report, 76% of its core brands came from men's wear, while 24% came from women's wear.

As for the decline in sales in the mainland market, Giordano said it was due to the unusual cool weather in the spring of 2016 and the closing of poorly performing stores, resulting in a 10% decrease in sales in the Greater China region.

But Giordano seems unwilling to fail.

Recently, Giordano announced that it will open 100-200 franchises in the mainland in the second half of this year and launch a free alliance mode.

It is understood that

At present, there are 896 stores in the mainland, of which 536 are franchisees, which means that the number of shops that Giordano will complete in the second half of the year will reach nearly 1/4 of the existing stores.

This action has been interpreted by many people as a means to digest inventory.

The reporter called Giordano Hongkong headquarters and Guangzhou branch on joining and other related issues. As of press time, no reply has yet been received.

Semi annual reports showed that although the company's inventory decreased by HK $100 million in the first half of the year, it still reached HK $392 million, while receivables and other accounts receivable amounted to HK $542 million. The operating cost even exceeded the cost of HK $260 million.

Although the gross profit margin increased by 2.4% to 59.6%, the semi annual report also acknowledged that the mainland contributed 25% of its sales, while profits accounted for only 19%.

In fact, not just Giordano,

The two brands of burshlung have also had a bad time.

Baleno, who once invited Andy Lau, Zhou Runfa, Maggie Cheung and other stars as spokesmen, was sold for 250 million yuan by the parent company Hongkong de Yongjia group at the beginning of this year because of the plight of continuous losses and the failure of pformation. The company is Shanghai Hui Ye Industrial Co., Ltd., which is a business mainly engaged in investment management consulting, electrical and mechanical equipment and accessories, computer hardware and software development and so on.

The same is true in burshilong.

Recently, 00592.HK announced a profit warning in the first half of 2016. It is estimated that the profit attributable to shareholders of the group will be reduced by 75%-85% compared with the same period last year.

The decline was mainly due to a decline in the number of passengers and a strong Hong Kong dollar, which led to reduced consumption of tourists in Hongkong and Macao, as well as local consumption in many core markets.

Ding Yun, head of consultancy partner and retail research center, believes that the fast fashion brand is looking at the single store operation capability in the early stage of development. With the expansion of the scale, the headquarters needs to make standardized replication management, including the output of the talent store manager and the integration of the supply chain.

Ding Yun said that the advantages of Giordano, Baleno and other traditional Hong Kong fashion brands lie in the ability to control the traditional supply chain, that is, the strong cost control. However, due to the lack of research on consumer demand, there is no change in fashion consumption to grasp the upgrading trend.

In the view of Ding Yun,

In the final analysis, the decline of brand lies in the lack of creativity of products and the lack of large scale experiential stores of aggregated people. It can not really understand the needs of front-line customers and the strategies of competitors.

In recent years, the stores of Giordano, Baleno and burshlung have moved to the two tier business district, some even to the shopping centers or supermarkets in the community.

Fast fashion of Chinese and foreign "attack"

According to an industry network salesperson, in the 90s of last century, there was little competition for domestic leisure fashion brands. For example, men's clothing was the mainstream of clothing at that time.

The demand for young consumers is not satisfied.

Giordano and other brands entered the mainland at this point in time, filling the gap in the market, so they developed very fast.

Subsequently, a lot of leisure and fashion products appeared in China.

Brands, such as Semir, Smith Barney, Mark Ed Faye, CABBEEN and so on, have H&M, ZARA, UNIQLO and other fast fashion entering the Chinese market internationally. "They have a relatively high degree of convergence in price and fashion, while the original Hong Kong brand system lacks innovation, which is far behind these new brands."

Clothing retailers from Spain

In recent years, the growth rate of China's performance has been impressive. Its parent company Indidex group has achieved the fastest growth in three years in fiscal year 2015, sales reached 20 billion 900 million euros, while the group net profit was 2 billion 875 million euros, achieving a 15% growth.

Behind the rapid development momentum, the secret of success may lie in the rapid response to the market trend.

According to public information,

Each season has an average of 11000 styles, with an average of 2 to 4 weeks from developing to new products; the other fast fashion giant, H&M, has an average of 3 to 5 months to develop new products.

Wang Dan, who has long experience in the clothing industry, told reporters that the development cycle of domestic clothing brand goods takes 6-8 months, which is far behind ZARA.

"Buying clothes is actually a perceptual consumption.

The fast fashion brands abroad are strong, and the products are updated very fast.

The consumer group is 18-25 years old, and the consumption demand of these people is very high, but the economic strength may not be very strong, and the affordable price is more attractive to them.

The industry believes that the current 20-99 yuan basic products of Giordano can be bought at similar prices in ZARA, H&M and other fast fashion. Therefore, consumers are more willing to choose international brands when the price difference is not large.

And younger consumers will pay more attention to the matching of fashion products.

"Leisure fashion brands demand high tide flu, which will have a great impact on product development and marketing."

A staff member who once worked in a sales office in Giordano told reporters that many brands such as Giordano and Baleno have not known Giordano and Baleno after 90 years. This kind of casual wear brand, which is the main product quality in the past, can not get the favor of the young people because of their lack of individuality and publicity.

In fact, in addition to facing

The branding of brands and the rise of e-commerce also have a lot of impact on traditional clothing retailing.

According to the statistics of the joint venture network, including

The 7 clothing listed companies, such as Lang Zi, CABBEEN, Daphne, and American Apparel, closed nearly 1000 stores in the first half of 2016.

From the semi annual report released by major enterprises, most enterprises will increase the development of the electricity supplier sector in the second half of the year to offset the weakness of physical store sales.