Traditional And Old Clothing Industry "Wear Out" New Business Opportunities.

130 listed companies, 37% online shopping penetration and over 2 trillion and 300 billion market scale, there are still many promising opportunities in the traditional and old garment industry. What are the new characteristics and opportunities of the fashion industry in 2019?

　 1. The charm of the first category of Internet Retailing

Before analyzing the clothing industry, let's look at two interesting information. First, clothing is very old, but it is called "the eternal sunrise industry". China is the largest clothing producer and exporter in the world. Second, it is very "Internet", KPMG research shows that in 2016, 21% transactions contributed to the largest category of Internet retailing, and penetration rate of online shopping reached 37%, far exceeding the average value of the overall retail industry.

Qing Tong capital concluded that the "sunrise industry" and the top category of Internet retailing still have huge industrial evolution and market prospects. This article will study the opportunity track mainly from the perspective of brand clothing.

Clothing trillion market size, showing growth rebound. In 2012, China's apparel industry experienced a "stock" crisis, and entered the inventory cycle. In 2017, it was revival. Tung Tung capital research found that in 2019 1-6, the retail sales of clothing businesses above the limit reached 475 billion yuan, an increase of 2.7% over the same period last year. According to Euromonitor data, the scale of China's clothing market as early as 2017 has reached 2 trillion and 300 billion yuan, and the compound growth rate of five has reached 6.1%.

　　 Two. Brand clothing 2019 investment and financing market analysis

The garment industry has been developing for more than 30 years, and has experienced wholesale, primary retail and mature retail stages. There are 2 important points in time: the rise of the electricity supplier in 2010 affected the development of the entire garment industry; in 2012, -2017 went to inventory and the industry entered the adjustment period. Then, what is the performance of the apparel industry in the capital market through its marketization process?

The clothing industry has already run a large number of listed companies. The wind data of Qing Tong capital collate, as of September 2019, there were 48 A shares and 82 Hong Kong stocks in clothing listed companies, which are relatively mature in the capital market.

Throughout the past years, the clothing industry listed companies, in 2017 can be described as a large number of listed new year, 27 clothing companies successfully Shanghai, Shenzhen, Hongkong three major stock exchanges, the creation of a single year new textile and apparel listed company's new high.

Looking at the level of investment and financing in the primary market, public data show that in 2019, a total of 7 clothing projects were financed in August. Qing Tung capital research found that from the point of view of the round, 6 projects occurred after the B round, and the capital was concentrated in the middle and later stages.

In terms of quantity, from 2017 to August 2019, a total of 57 projects were financed, including 34 in 2017, 16 in 2018 and 7 in 2019. The projects are mainly concentrated in Beijing, Shanghai, Zhejiang, Guangdong and Fujian.

The study of Qing Tung capital found that the number of financing decreased, and capital favored the middle and late projects. The reason is that the capital market is more rational for the clothing industry. The early clothing brand is very uncertain. It faces three problems: channel pressure, explosion pressure, inventory and capital pressure.

The original brand can make one or two explosions based on the designer background, and get a certain scale of revenue in a short time. However, the garment industry is updating rapidly, and the consumers are changing rapidly. The ability of the new brand to continuously launch the explosive payment is very uncertain.

It is easier to get capital support by running out of a certain size of clothing brand, more mature product matrix, better echelon, plus advantages of various distribution channels.

The overall development of the garment industry is relatively mature, and the main track has already run a large number of listed companies. The new opportunities are mainly focused on the subdivision of the track. How to continue to create explosive funds and reduce inventory control costs is emerging brand opportunities.

The overall revival of the brand apparel industry in 2017 coincided with the fashion of the country, blowing the clothing market in recent years. Behind the tide, what are the new changes in the consumption concept of the new era, from the dimensions of design, production, supply and demand, and the apparel industry?

　 Three. Tide: Chinese brand + Chinese style

The "national tide" has jumped into the public view since 2017. Tsing Tung capital research found that the concept of "chao chao" is widely interpreted and has no unified definition. It can be summed up in two dimensions: Chinese style + Chinese brand.

Next, the capital will gradually explore the influence of the "national tide" on the overall garment industry from two perspectives, the consumer side and the brand end.

Domestic brand acceptance increased: consumer purchases increased by 14.8% over 2016.

Consumer acceptance of domestic brands to enhance. The study of Qing Tong capital found that from 2016 to 2018, consumers' acceptance of domestic brands could be viewed from 3 dimensions.

1) the penetration of national tide brands increased rapidly, rising to 38% in 2019, but only 25% in 2017.

2) the positive impression of domestic brands increased. In 2018, 84.4% of respondents had a better impression of domestic brands.

3) increased consumer spending. In 2018, a survey of Chinese consumers' preference for domestic brands showed that 75.8% of respondents increased their consumption of domestic brands in 2018, an increase of 1.5% over 2017, an increase of 14.8% over 2016.

There are 2 main reasons behind the improvement of domestic brand acceptance: on the one hand, after 90 and after 00, the consumer concept emphasizes self, longs to create its own unique style, and has a deeper understanding and identification ability for brands and products. They are more open and inclusive to local brands, and do not care if they import local brands.

On the other hand, factors such as Chinese manufacturing, identity and quality improvement influence. Domestic brands gradually occupy the minds of younger generation of consumers, and also bring positive benefits to the development of domestic clothing brands.

　　 Big brands enhance their sense of design, sportswear rise

From the perspective of brand development, there are 2 obvious points in the action of the national tide: 1) the sense of design is stronger and stronger. 2) from the category dimension, sportswear leads the fashion of the country and the rise of minority clothing.

China's famous brands began to take the design route, emphasizing the sense of design and boosting the "national tide". Lining and Bosideng design with Chinese style, landing in New York fashion week. Anta, noble bird, and Hai Lan's home have launched a new fashion to attract younger generation.

At present, most of the leading trends are sports brands. Sportswear is heating up rapidly among young consumer groups. According to AI media consulting data, the sales volume of China's sports shoes and clothing market in 2018 was 46 billion 500 million yuan, an increase of 12%, and online channel sales increased by 14 billion 400 million yuan, an increase of 8%.

Small clothing, such as "antique" clothing, has been growing rapidly, and has become a new trend of Z generation. On the street, you can see the Z generation wearing antique costumes, and the trend of ancient wind clothing is towards constant wear.

Tsing Tung's capital analysis reveals that the rise of sportswear and niche clothing is also related to its category characteristics. Compared with women's clothing, its category width is small, single SKU is easy to measure; it focuses more on comfort and functionality, and the design iteration pressure is relatively small, which can effectively extend the style life. Small clothing is sold in advance mode without stock pressure.

No doubt, these two categories are in line with the development logic of new brands, breaking through the 2 pain points of brand clothing: explosive speed, inventory and cost.

　 Four. The 3 opportunities track analysis of brand clothing under the national tide

In 2017, the tide of -2019 brought about good results and interacted with the trend of brand clothing differentiation and development.

Sportswear has sprung up and small clothing has sprung up. What other clothing subdivision tracks have attracted attention? How did their underlying logic take effect? What are the new opportunities for development in 2019?

　 Sportswear suddenly rises.

Sports industry is recognized as one of the best racetracks in the industry. China's sportswear market is growing rapidly, and its growth rate is far ahead. In 2018, China's sportswear market exceeded 40 billion US dollars, up nearly 20% compared with the same period last year. The growth rate has been accelerating since 2014, and the consumption structure of clothing has changed. In 2018, the proportion of sportswear to total clothing consumption rose to 12.8%, while that in 2013 was only 8.8%.

Sportswear consumers have a high degree of coincidence with age. The consumer insight of the 2019 sports apparel industry found that the majority of the consumers were after 90 and 95, of whom 35 accounted for nearly 9.

The Z generation has become the main consumer of the Internet and new brands. The Z generation's online payment habits, Internet dependence, positive consumption, cultural confidence, labels and interests have brought great opportunities to new brands.

Sports apparel racecourse, foreign brands and domestic brands dominate, Adidas, Nike, Anta ranked three in the market. Traditional big brands have strong path dependence in brand tonal and innovation, and are not enough to respond to changes in the consumption habits of ordinary consumers. The problem of slow turning of giants has provided room for survival for other emerging brands in the rise of sports apparel subdivision track.

Sports fashion as a subdivision of sportswear has begun to shine. According to Chi Chi research consulting, sales of Chinese sports fashion apparel reached 52 billion 10 million yuan in 2017, an increase of 8.6% over the same period last year, and sales of sports fashion footwear reached 63 billion 630 million yuan, up 14.8% from the same period last year, and the growth rate was relatively high.

Sports fashion has become an important category to promote rapid growth. The current demand for sportswear is no longer functional, but emphasizes the combination of functional and fashion design. On behalf of the brand, there are Particle Fever particle fanaticism and so on. Its products combine the technology function with the fashion sense, and from the production, the design, the idea to the cultural many aspects fusion, redefines the domestic label.

China's sports apparel market is expected to reach US $65 billion 900 million in 2023, and the composite growth rate will exceed 10% in the next five years. The market scale will account for over 16% of the total apparel market.

Sports brand has its advantages from the perspective of product iteration. Compared with casual wear and constant clothing, its speed of iteration is relatively slow, which can effectively extend the life of explosion. Category is less than women's clothing and men's clothing. For start-up companies, it's easy to get a single amount, focusing on scale effect and easier to run out. The new sports brand is expected to create more professional and explosive market share through intensive efforts in the field of subdivision.

　　 Non sexual dress: new category breakthrough

Neutral wind has become a new trend of clothing consumption in recent years.

From the perspective of apparel industry chain, asexual clothing can be seen as a breakthrough of new category. It creates a neutral version of the same sex, achieving SKU reduction, reducing inventory and cost.

There are 3 main categories of neutral wind consumer groups: the first category, the new male, the male aesthetic awakening, the old men's brand image aging, unable to meet the young people's demand for fashion and fashion style; the second category, the new women, under the influence of the men's and women's rights movement, the female social position is more independent, the female and the cool girl image are very popular; third, the vertical crowd has just need for the neutral clothing, such as LGBT, lovers, university students and so on.

Women are getting cooler and cooler, and men are getting more and more sophisticated. Taobao data, since 2019, the number of women buying suits has significantly exceeded men's, while men's search volume for perspective clothing and lace has also increased. In women's search keywords, "loose" has become a common word; men's search for common words is "tide".

The emergence of asexual clothing is mainly manifested in two aspects: on the one hand, with the help of the big name neutral wind, many brands merge men and women's clothing, and fast fashion giants ASOS, Zara and H&M have launched a series of sex free clothing.

On the other hand, the rise of domestic neutral brands, such as bosie Boxi, settled in Tmall in the first month of 2018, breaking millions of yuan, and strong demand for neutral clothing in the domestic market.

Another advantage of asexual dress is that it can be overlapped to men's clothing and women's clothing in two markets.

The capital market data show that the market scale of women's clothing industry in China reached about 923 billion 200 million yuan in 2017, an increase of 5.8% over the same period, which is expected to surpass trillion yuan in 2019. In 2017, the retail market of men's clothing market reached 676 billion 100 million yuan. In 2020, the retail market of men's clothing market is expected to reach 979 billion 300 million yuan. No sex clothing, breaking through the traditional pure men's clothing and women's clothing, the same SKU can achieve sales in the two big markets.

　　 Rise of minority clothing: clothing selection for Z generation

When the personality is in the right place, more young people tend to show their individuality with the minority dress. Minority clothing, including Lolita, Hanfu, JK uniform, etc.

The popularity of antique clothing is promoted by the national tide. Hanfu is one of the most popular choices. Tmall's "2018 Hanfu consumption crowd report" shows that the number of Chinese clothing purchased in 2018 increased by 92% compared to the same period last year, and the total consumption volume of the Han clothing market has exceeded 2 million. Publicly available data show that the total industry size is about 1 billion 90 million yuan.

The most prominent feature of the minority clothing user group is young, vertical and circle. Such as Lolita enthusiasts, known as Lo Niang, Hanfu fans, called each other "Robe".

Consumers of minority clothing have a strong sense of identity and belonging. Data show that in 2019, there were more than 2000 Hanfu culture associations in the world, compared with more than 1300 in 2017, the growth rate was 46%. Niche clothing user circles, the greater the stickiness, prone to re purchase.

The number of Hanfu businesses continued to increase. According to Hanfu information data, there are 815 Han Chinese clothing businesses in Taobao stores in 2018, an increase of 24.43% over 2017.

Han clothing businesses are distributed throughout the country, the Pearl River Delta, the Yangtze River Delta and Sichuan provinces are the main areas. Meanwhile, the number of merchants in every region and every city is increasing, including 116 in Zhejiang, 141 in Guangdong and 110 in Jiangsu.

Hanfu has been favored by capital, such as Yi Xing Hui, who cut the Hanfu market by weaving the feather brand, and completed the angel wheel in 2018.

Hanfu sells products in a special way, and sells in advance, which is different from the traditional clothing distribution mode. There are 2 forms of pre-sale: one is to make presale with sample clothes before each sale, and then to produce and deliver after a certain amount of orders. The other is to implement the earnest cash payment system. If the amount of the deposit is not up to the expected standard, it will flow into the group.

The advantages of these two forms lie in solving the long-standing problem of clothing industry: inventory and capital pressure.

Accelerating and popularizing the flexible supply chain in China provides a supply base for niche clothing and other niche productivity.

Flexible supply chain can achieve multiple, small and fast production to achieve low cost capacity. At present, the traditional supply chain is constantly digitalized. Taking Amoy factory as an example, in 2018, we planned to transform 200 digital factories to improve the flexible supply chain, and will open it to more than 30 thousand garment factories.

Objectively speaking, Hanfu clothing belongs to the minority clothing. It is still at the initial stage, and has a large distance from the mature garment enterprises, but its market growth is very fast. The annual growth rate is more than 100%.

There is no doubt that the demand for small garment front-end is enough, there is a low cost supply at the back end, a unique way of survival for production, flexible supply chain support, and the cluster industrial chain relying on this carrier has huge imagination.

　　 Five. Conclusion

Based on the above studies, the capital analysis revealed that there are still many promising opportunities in the traditional and old garment industry.

There will be an opportunity to become the next blue ocean market around the three major points of pain, including the continuous iteration of the explosive payment, the pressure of inventory funds and the pressure of distribution channels.

Relying on the rising brand strength and product strength of Chinese brands, the new trend and inspiration will undoubtedly be injected into the clothing industry. Combining the design of the national tide with the solution of the three major pain points, we summed up the three opportunities track of the apparel industry: sportswear, asexual clothing and minority / national costume.

With the further maturity of the investment and financing environment in the primary market and the increase of investment and financing projects in the middle and late stages, the apparel industry will be expected to usher in a new group of Unicorn enterprises.