Foreign Clothing Business Is Everywhere, Why Is There Only One Amoy Family In The Country?

Recently, we have been looking at the vertical clothing business operators, and found an interesting phenomenon:

Revolve, shopbop, wconcept, fartetch, mythersa, netporter, all of which are clothing business platform, and most of them are good. It is good for Mao's domestic Amoy department. There is no prospect for other development.

Vip.com is on the decline, the temple can be privatized, mogujie.com is half dead, such as Han holdings, and jumei.com has fallen yesterday.

Were they killed by Ali's "two election"? Domestic dress is the only one in Ali. Why?

What is the cause of this condition? Domestic clothing business, whether there is investment value? What vertical direction should be chosen? Is it the chance to stand out from the Alibaba alone?

Recently, the Chewy hot pet supplier with a market value has a market capitalization of US $13 billion. Is there any chance in China?

With the above questions, I did some research recently. This article aims to answer this question. The article is divided into two parts.

Looking back on various explanations in the past, such as high-frequency low-frequency theory, Taobao's advantage theory, category ceiling theory and so on.

What factors cause foreign clothing business to blossom everywhere, but a big domestic company?

01 why are all kinds of explanations in the past unreliable?

There are several kinds of arguments about this kind of clothing supplier, such as "orange orange" and "Bei Zhi", which are plausible. They seem quite reasonable, but they are very problematic. Let's make a simple analysis here.

1, high frequency low frequency / flow cost theory

Those who hold this argument believe that the cost of obtaining and activating consumers is relatively low due to high frequency applications, and the vertical electricity suppliers gradually lose their market in a long-term economy.

Of course, this theory is feasible in explaining why Dangdang and vip.com are going downhill. After all, the "three charges" such as marketing cost have scale effect. In the long term competition, these websites are gradually declining because of the small scale of these enterprises and the low cost of GMV. Although the frequency of Jingdong is slightly low frequency, the high price per passenger is acceptable from an economic point of view.

But this answer does not explain the question: Why are these clothing business operators not being killed by Amazon but thriving? A lot of people take this question for granted. This theory is just a logical fact.

2, category ceiling theory

People holding such reasons believe that vertical electricity suppliers are a pseudo track because the height of space determines that it is difficult to survive.

Vertical electricity providers do not have long-term value. It is still necessary to verify whether the fact is true or not. Even if it is correct, there is no foreign case.

3, Taobao's first advantage theory

Those who hold this argument believe that in the era of mobile Internet, Taobao has established the status of head App too early, while the speed in Europe and America is relatively slow, and it also gives the vertical business App a window of independent growth.

There is some truth in this point of view, but there is no argument that Amazon missed the mobile Internet era, but there is a saying that Microsoft missed.

I do not think this can explain the problem clearly, because the domestic vertical electricity supplier during the period of 08~12 is surging and surging, the wind and tide will meet, heroes emerge in large numbers, everywhere are financing, everywhere are entrepreneurs. I think it is still necessary to verify the advantages of Taobao.

To sum up, the above three arguments are discussed by many people when they talk about the development of domestic electric business. Although there are some reasons, they can explain something to a certain extent, but they are not convincing.

02 what is the cause of the clothing business supplier?

With regard to the vertical clothing business, I have read a lot of information, and I have found many good friends to do the consultation background. Let me talk about the truth I understand.

There are two main factors:

User consumption habits and the way of Amazon category expansion

Industrial clusters and characteristics

We aim to explain these two points in detail.

1, user spending habits and Amazon expansion

In interviews with a lot of friends who are familiar with fashion in Europe and America, I got some information: in the past, Europeans and Europeans did not buy clothes on Amazon.

A lot of feedback is: Europeans and Americans generally buy clothes in physical department stores and official website. Obviously, they point out that Amazon does not provide such services, nor does it cultivate users' habit of buying clothes.

Then, in the process of category expansion, clothing is ignored or even abandoned by Amazon. After raking the research report, we found that Amazon's SKU expansion is indeed the case.

From the past historical category expansion, combing clothing category may not be the focus of Amazon.

Let's analyze the absolute amount of information:

During the selection period, even in 2011, clothing sales were only 8.4%. Almost the same period, we compared the data of Ali:

This is the data situation of Taobao in 2011, accounting for 21% at that time and 2.5 times that of Amazon.

Therefore, we find that in the early middle period, Amazon did not dress up as a good business.

Let's look at what happened to Amazon in the last two years.

According to the latest situation, there are 4904 kinds of clothing in SKU, accounting for nearly 75% of the categories.

Of course, it's even more fun to see the amount.

See, Apparel (clothing) accounted for only 1% of the total.

75% of SKU accounted for 1% of revenue. (accounting student attention, here does not meet the matching principle yo, high-risk area)

What kind of attitude is this? Of course, the attitude of the recent two years has been developing vigorously, so this is the real strategic importance. (of course, the clothing category may be SKU statistics and others are not the same. Maybe a size is counted once, but relatively speaking, it still shows that SKU and revenue contribution are not matched).

Of course, we also choose Ali's latest situation:

This is the cross section data of the 618 period, and clothing category is still the largest contribution category, accounting for 18%.

At the same time, we observed that compared with the proportion of Ali in 2011 (that is the period data, the non time point), the clothing category decreased from 21% to 18%, while the 3C number increased from 16% to 17.5%. Alibaba also seized the share of Jingdong in guaranteeing the basic market.

Therefore, from the supplier's point of view, Ali and Amazon have different focus in the development of SKU category.

Amazon will focus on digital, electronic and daily necessities, while Ali is just the opposite. As far as possible, the "all-purpose Taobao" can be completed with the majority of non-standard products. This difference of gravity causes consumers not to buy clothes in Amazon. They like to go to the store. Until the last two years, with the rise of fashion business, it gradually cultivated people to buy clothes on the platform.

Generally speaking, Europe and the United States have never bought clothes in Amazon. People like to go to the physical store, and there is no monopolistic clothing platform. In addition, people will go to the clothing brand website to buy them one by one. And the domestic idea is to buy clothes, first go to Taobao, find brand direct shop.

This phenomenon, of course, is not accidental. It is directly related to the industrial characteristics and environment.

2, industrial clusters and characteristics of the two countries

Just imagine what happens if a businessman in Europe and the United States wants to make some clothes for sale.

Obviously, first of all, she has to design, then make the model, find the fabric, find the clothing factory.

The trouble in the middle is obvious. The core problem is where the clothing factory is. There are no factories in Europe and America. In many countries, there are no private factories to make clothes, and then to sell them in electronic business. And is it not a minute thing in China?

Even if foreign countries do not find factories in private form, the cost is very high. They emphasize design (Art), pay attention to creativity, so the cost is very high and the process is complicated.

In the mainland, these do not exist. What intellectual property rights, original plans, and those who block wealth are all rolled aside. The foundries are everywhere, and there are too many markets for all kinds of fabrics. In China, it may take a week to set the final version to the final factory.

I think the reason for this is that the comparative advantage between countries is the clothing industry cluster and its distribution.

Search keywords for "clothing industry".

Production accounts for 1/3 of the world, and the strength of the foundries is obvious.

At the same time, a large number of foundries were born in China, and the following ten global apparel manufacturers are listed.

01 Lian Tai Company

There are factories in Dongguan, Qingyuan, Jiangsu and Philippines.

Number of workers: 80 thousand

Foreign brands being OEM:

Ralph Lauren, Adidas, Liz Claiborne (famous American middle ranking brand), Calvin Klein, Victoria s Secret

02 joint company

(headquarters in Hongkong, main processing plant in mainland China in Dongguan)

Number of workers: 50 thousand

Foreign brands being OEM:

DKNY, J Crew, NAUTICA, Givenchy, BROOKS BROTHER, Burberry, Callaway (golf equipment)

03 Yida company

There are processing bases in Hongkong, Guangdong and Changzhou.

Own brand: send Pye

Number of workers: 80 thousand

Foreign brands being OEM:

AbercrombieFitch, Lacoste, Polo Ralph Lauren, Nike, Tommy Hilfiger

04 Jiangsu CHENFENG group (Changzhou)

Number of workers: unknown

Foreign brands that are OEM: UNIQLO, CK

05 Hongkong Yongjia group

(factories in Guangdong, Heyuan, Yunfu, Guangxi and Wuzhou)

Number of workers: 30 thousand

Major OEM brands:

Adidas is also the core garment manufacturing supply of Adidas in China.

06 Dayang creation company (Dalian)

Own brand: Genesis TRANDS

Number of workers: unknown

Foreign brands being OEM:

BCBG women's wear and suits are mainly for Europe, America and Japan, including MS, Macys, P&C, Aoki and so on.

07 Shenzhou group

(Ningbo and Quzhou have factories)

Number of workers: over 100 thousand

OEM brand:

NIKE, ADIDAS, PUMA, ANTA and leisure brand UNIQLO, etc.

08 Changjiang Garments Co., Ltd.

(Hong Kong listed companies, processing plants in Wuxi and Guangzhou, Panyu, etc.)

Its own brand: Ma Shilong and so on, and its subsidiaries have acquired the famous brands such as Ji Long Xue in France.

Number of workers: unknown

Foreign brands being OEM:

Pringle, Miss Sixty, YSL, Diesel, Marc Jacobs, Ashworth

09 Xia Meng Yi Jie group

(Wenzhou, Zegna joint venture)

Own brand: Xia Meng Piombo (joint venture brand)

Number of workers: unknown

10 Jingyuan group (Dongguan)

Number of workers: 70 thousand

Major customer brands:

UNIQLO, PINK, ATY, HM, JCPENY

Among them, we are familiar with Shenzhou International (HK:02313) and HK:02232, which are listed companies in Hong Kong stock market. Shenzhou International is a hot stock.

From the end of 05 to the end of the year, it has risen more than 60 times.

Such industrial clusters, especially the foundry factories in the southeast coastal areas, decide that the clothing business is very different from home and abroad. Early Ali seized this trend and cultivated it. Amazon chose to conform to the trend of the developed countries and choose the products of standardization and industrialization.

With the rise of fashion business, Amazon has started to force this category in recent two years. There is huge time lag in the middle, so new websites can run out a lot. As for the future Amazon can replace these websites through "high frequency and low frequency", it is not easy to say.

03 summary

In essence, the foreign clothing business is booming, but the main reason is that the industry infrastructure is different. Two excellent companies, Ali and Amazon, have captured the types of local industry characteristics, and have chosen the right SKU expansion to become the global leader in the business.

For investors, there is a question of whether there is a $10 billion vertical electricity supplier in the US version of Chewy. I am not very optimistic about the domestic version of pet business. I will have a chance to chat next time. I hope it will enlighten you.