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    European And American Fast Fashion Faces The Challenge Of Rush Out Of The Red Sea. What Do You Think?

    2019/12/18 11:48:00 0

    Fast Fashion

    Following Forever 21 and New Look, the sub brand Old Navy of American Apparel Brand Gap will also disappear in the Chinese market. Recently, Cape announced that its Old Navy will be withdrawn from the Chinese market from 2020 after its independent spin off, and will focus its efforts on the North American market in the future to maximize its efficiency. The report shows that the company is facing a decline in sales and profits.
    It is reported that the sub brand was founded in 1994 and landed in China in 2014. In March of this year, he announced that the Old Navy brand would be split into an independent listed company. It is expected that the splitting transaction will be completed by the end of next year. In addition, the GAAP group will close about 230 stores in 2 years.
    At the same time, the latest performance data disclosed by the Cape group is not satisfactory. In the third quarter of this year, the overall sales of Cape group decreased by 2.2% to 3 billion 998 million US dollars, compared with 4 billion 89 million US dollars in the same period last year, and net profit was 140 million US dollars, down 47% compared to the same period last year. The same store sales of sub brands Old Navy and Banana Republic are all negative. Old Navy's decision to quit China has also made some consumers feel unprepared. "This brand is located in the prominent position of several shopping malls in Beijing. It feels that the price is higher and the quality is not bad." Ms. Lee told reporters at the new China Jingwei that in recent years, many fast fashion brands around the world are facing the risk of closing stores or retaining customers in discounted promotions. She feels that her choice is becoming less and less. In the Tmall flagship store, the highest priced single item is a T-shirt priced at 99 yuan, which shows less than 2000 monthly sales, while the second month sales volume is only more than 800. The sales volume of Tmall's flagship store is the highest, and the monthly sales volume is more than 15 thousand.
    Do you remember the Forever 21 officially withdrawn from the Chinese market in early May? Originally thought that the American fast fashion giant who had been in the fire for more than 20 years was only in Waterloo who had been caught off guard in China. It did not expect that it was the beginning of a complete "death". In..9 month, Forever 21 declared for bankruptcy protection, and stopped operating in 40 countries and shutting down most of its stores. Forever 21 was founded by a Korean couple in California. The brand quickly opened up the US market because of its precise positioning, easy price, quick product updates and fast logistics. In the thirty year, Hedong and thirty years Hexi, the international brand went to the magic city seven years ago, and then launched an inland city strategy. It was popular with countless young girls by virtue of price advantage and the tailoring of no big name. However, now, clear up, withdraw, continue to close shop until completely withdraw from the Chinese market!
    In December 2018, the British clothing brand New Look, which had been stationed in China for 4 years and threatened to open 500 branches, also officially withdrew from the Chinese market. Its 2018 annual report shows that the group's annual operating income is 1 billion 348 million pounds, the lowest value in five years, and the basic operating profit also has a loss of up to 74 million 300 thousand pounds.
    In recent years, the current situation of fast fashion brands has repeatedly been shut down. According to insiders, the industry has been developing blowout in the Chinese market with the advantages of following the trend, paying close attention to the price and being quick and quick. However, when the market is in a state of saturation, enterprises need to reduce their scale, improve their quality, upgrade their brand's updating and changing speed, and attract consumers with new images and products.
    Ma Gang, an apparel industry expert, told Xinhua in an interview that at present, the fast fashion industry is faced with the challenge of how to rush out of the Red Sea, including how to better product localization and the stratification of consumers. "Because of the difference between the market environment and consumers, some brands do not agree with each other. Brands need to match different products and marketing strategies for consumers in different channels and regions. " Ma Gang emphasizes.
    It seems that the fast fashion in Europe and the United States is facing the challenge of coming out of the Red Sea. What do you think?

    Source: Qingfeng finance and Economics

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