Lost, Slow And Fast Fashion Brands

Fast fashion brands do not seem to be in a slump. According to the latest report released by fashion agency Thredup, 25% of female consumers say they will no longer buy fast fashion clothes from 2019, most of them young consumers. Of the more than 1000 women surveyed by Thredup, 58% thought that waste should be reduced this year. Another 42% said they would reduce waste by buying second-hand goods.

Faced with the lack of market demand, fast fashion brands are finding their own way out, for example, ZARA is strengthening digital stores and UNIQLO in manufacturing content influence.

This is good news. The combination of digitalization and retailing is a trend in the future. What needs to be seen is whether the commercial accumulation behind the digitalization is based on efficiency improvement or is the strategic shift of physical stores being cold?

Over the past decade, the international fast fashion retail brands represented by H&M, ZARA, GAP, UNIQLO and so on have entered the Chinese market successively. With the advantage of low price, rapid change, and providing consumers with fashion trends, they have seized the market share of China's local clothing brands. At the same time, with the rise of shopping malls and shopping centers in China, the rapid expansion has been achieved.

After enjoying the rapid expansion bonus, the fast fashion brand has lost the enthusiasm of concern recently.

According to multi data, sales of fast fashion brands continued to slow down in 2018, and share prices and valuation of H&M and ZARA fell. The news of fast fashion brands' withdrawal, reduction of store area and shop decoration constantly. "Confusion" has become the definition of media and fast fashion brand. To judge the future development of an industry, we should not be hasty. A short period of adjustment may also be the start of the next outbreak. Besides, some brands are still the star shops in the business district.

Fast fashion is slowing down

Just in the past 2018, fast fashion shop in the second tier cities consumers in the eyes of the attractiveness of the gradual decline, "shutting down" action makes the entire fast fashion industry in the shadow.

In January, the fast fashion brand GAP will be withdrawn from New York CBD. In September last year, ZARA closed its first store in New York. C&A is also being sold shortly or will be acquired by Chinese companies. In addition, New Look plans to close about 10% of the UK's 60 shops to save rent costs.

Behind the fast fashion brands' frequent closes and slowing down stores, they have become cruel and cruel.

In February 23, 2018, the Inditex group of ZARA, the parent of fast fashion brand, lowered its target price on the same day, and predicted that the gross profit margin of the group will further decline by 5%, resulting in a sharp drop of 7.06% to 25 euros in the day, a three year low and a 5 billion 900 million euro in market value.

In the first quarter of fiscal year ending November 2018, the operating profit of the fast retailing group of UNIQLO parent company decreased by 8.1% to 104 billion 665 million yen, or 970 million 200 thousand US dollars, less than 118 billion yen of market expectations in the first quarter of 2019.

Why is fast fashion brand closed?

According to statistics, H&M, a fast fashion brand that has entered the Chinese market early, has opened its first store in Shanghai since April 2007. By the end of November 2017, after 10 years of development, all the brands of H&M group reached 506 stores in China, the number more than 2 in the number of stores, next to 536 in the United States.

In February 2006, the first flagship store opened in Nanjing West Road, Shanghai, and the momentum for ZARA to open shop in China was also very fast. Before 2011, there were only 119 stores in the country, but in 2011, 156 new stores were opened in one year, and 121 in the following year.

The rapid expansion of stores led fast fashion brands to quickly occupy the Chinese market from 2011 to 2012. H&M, UNIQLO and other brands also began to carry out the enclosure movement by increasing sales and increasing sales.

Affected by the decline in performance, H&M revealed that the number of shops opened in 2018 will be reduced. It is estimated that all brands will open 390 stores and close 170 stores a year, which will be reduced by half compared with 388 in the 2017 fiscal year.

If China's demographic dividend has achieved the status of fast fashion brands in the world over the past decade or so, the adjustment of consumer awareness and consumer agencies in recent two years has repeatedly blocked fast fashion.

1. "fast" effect weakened, sequela revealed.

China's Internet has been circulating "only fast can not break" the conclusion, crowned with "fast fashion", fast not only reflected in the fast consumption level. As we all know, the fast fashion brand represented by ZARA has strong supply chain management capabilities, and the time from design to production is very short. It effectively meets the consumption needs of the modern information society. But there is an old Chinese saying that "radish is fast and not washed". The quality of fast fashion brands is already common, and some media predict that some brands will be seen on the 315 of tomorrow.

Moreover, the brand loyalty that comes soon will be precipitated. Previous studies have shown that consumers buy fast fashion clothes because of their favorite fast fashion brands or favorite styles, rather than buying good brands, and the emotional connections between brands and consumers are weak, and consumers are easy to lose.

2. local brands resuscitation, fast fashion brand competition intensifies

Fast fashion brand in China for more than ten years, during this period, MJstyle, hot air and other Chinese local fast fashion brands rapidly rise, and gradually impact.

According to China clothing net report, from 2016 -2017 new well-known fast fashion brand stores new situation, domestic fast fashion brand hot wind and MJStyle in 2016, respectively, with 160, 101 expansion speed ahead of other major brands. By 2017, MJStyle had expanded its 200 stores faster than H&M, UNIQLO, ZARA and other international brands, occupying a certain market share.

With the capital's positioning for the domestic fast fashion brand's holdings and more niche customers, and the deep influence of the electricity supplier, the shaping of the domestic clothing brand has been gradually recognized by consumers. Meanwhile, a number of Internet brands have been promoted gradually, and are widely touted by consumers, such as the Korean clothing house, the Jiangnan cloth dress and so on. Jiangnan cloth clothing has been very eye-catching in recent years. At present, there are 49 shops in the capital market, and its performance has been better in the capital market. The stock price has risen 67% in the past 6 months and its market value is about HK $8 billion 600 million.

To be sure, the learning and decision-making between local brands and consumers are showing a trend of mutual influence. The intensive cultivation of brands and the increase of investment in subdivision have affected the pattern of garment industry.

3. upgrading of consumption and upgrading of quality

Chinese consumers have gone through the age of blind pursuit of western fashion, more rational, and the demand for quality is gradually improving, and the market influence brought by consumption upgrading is being released.

There is no denying that the upgrading of consumption has been mentioned in the government's height. This year's government work report has a clear description. Consumer escalation, consumers pay more attention to quality. Some analysts have pointed out that industrial upgrading and upgrading of consumption will spawn more market opportunities.

As consumption continues to escalate, the interest of young consumers in China after 90's 00 is gradually declining on international fast fashion brands such as ZARA and H&M. Tide card has become a new force.

Perhaps there is no evidence to support the relevant data, but one idea is that the upgrading of consumption has promoted the revival of the old Chinese clothing enterprises, such as Lining who landed in New York fashion week some time ago and Anta, which was snapped up abroad. With the increasing demand for personalization and fashion, the brand that can highlight the concept of the times is once again favored by consumers. It is an indisputable fact that China's local design capability is improving. After the product quality problem is solved, the sense of design will be a major competition.

4. pressure from real estate business

In the era of commercial complex competition, the process of fast fashion brand draining into shopping malls assists the development of fast fashion brands in China. However, fast fashion brands have encountered problems through the rapid development of these years. Under the commercial overdraft business value, the homogenization of all kinds of formats and the vitality of fast fashion can last long.

The picture gradually seen by consumers is that when the fast fashion brand can no longer drain the commercial complex, the drawbacks of the business model also emerge, and its brand can not become the core. The introduction of new retail, let the entity store revival, the commercial complex gets warmer, and is the international fast fashion brand in China "spring" still?

Fast fashion era

Business is a reincarnation. In those days, the popularity of international fast fashion brands was accompanied by the downturn of China's local brands. This cycle will continue.

Competition is always accompanied by business development, but it is not the destroyer of business. The real opponent is this era. The times always choose the color. Huang Mingduan, the founder of big RFA, said when he left office, "defeated all the opponents, but lost to the times." Zhang Quanling, a former CCTV reporter, said in a speech, "when the age abandons you, you will not even say goodbye."

Respecting this era, it may be the best attitude for fast fashion brands to get rid of the haze of development.

Industry analysts suggest that fast fashion brands will continue to accelerate the pace of adjustment in the future, including joining e-commerce platforms, launching new high-end brands and playing joint names. Fast fashion needs more innovations and changes to meet the needs of the market to the greatest extent.

Last year, H&M, which had never contacted the electronic business platform, began working with Tmall. Previously, ZARA, UNIQLO and other brands have opened the way of online business platform. However, such online and offline channels do not significantly slow down the overall industry decline.

Embrace electric business, develop online business, let fast fashion brand taste "sweetness".

The electricity supplier is not the only way to respect the times. Insiders also pointed out that although the e-commerce platform helped to solve the inventory problems to some extent, the new logistics cost brought by the new e-commerce business will also test the integration power of the supply chain.

In fact, on the way of spanformation, many fast fashion brands have also launched their own secondary line products.

For example, in August last year, ZARA opened an independent retail store for children's clothing in Britain, mainly selling household goods and interior decorations. GAP's first independent children's clothing store in mainland China opened its doors in Yintai, West Lake, and H&M launched a more expensive high-end clothing brand. Forever21 went to the beauty industry and opened a beauty store. In addition, in order to further publicize the opening of new stores, C&A has opened a flash store in its store area to attract more young people's attention.

The market will not be flopping, but the enterprise will really fall. Maintaining a sense of crisis is the most real feeling for the brand to come close to the times.