The big names in the student days have declined one after another.
After La Chapelle, Jeanswest, and Daphne, this time it is the turn of women’s clothing brand Egger…
Women’s clothing brand Egger filed for bankruptcy and reorganization, and many styles were sold at 10% off during Double 11
Another former clothing giant fell silently.
Tianyancha shows that Shanghai Aige Clothing Co., Ltd. has been filed for bankruptcy and reorganization by Shanghai Luzhou Knitting Clothing Co., Ltd. last year. The handling court is the Shanghai Third Intermediate People’s Court, case number (2019) Shanghai 03 broke No. 155.
According to the information in the civil ruling, Shanghai Luzhou Knitting Clothing Co., Ltd. (hereinafter referred to as “Shanghai Luzhou”) He once went to court with Egger Company over a processing contract dispute. In December 2018, the court issued a civil mediation agreement, in which Aige Company paid Shanghai Luzhou 4.4973 million yuan. However, Aige Company failed to fulfill its relevant obligations, so Shanghai Luzhou applied to the court for enforcement. In March 2019, the final execution procedure was terminated because there was no property available for execution in the name of Aige Company.
Therefore, in July 2019, Shanghai Luzhou applied to the court for bankruptcy liquidation of Aige Company on the grounds that it could not pay off its due debts. On October 8, 2019, the court issued the Civil Ruling No. 03 Po 155, ruling to accept the bankruptcy liquidation case of the debtor Aige Company and appointing an administrator. In March this year, bankruptcy documents were served on Iger.
Not only that, Shanghai Yingmo Clothing Co., Ltd., a branch company established when Egger entered the Chinese market in 1994, also applied for bankruptcy and reorganization at the same time.
So far, the two companies have been involved in more than 1,500 legal proceedings in total, mainly focusing on labor disputes, Labor contract disputes, processing contract disputes, sales contract disputes, etc., and has been listed as the person subject to execution and the person subject to execution for breach of trust many times. In addition, its general manager and legal representative Lu Yixun has been listed as a restricted high-spending person by the court.
On Double 11 this year, a “Double 11 Special” message released by the Shanghai Bankruptcy Court’s public account even disposed of Iger’s remaining assets at a “10% off” price.
The name of the store where this batch of clothing is put on the shelves is “Shanghai Egg Manager Specialty Store”. Currently, there is only one product left in the relevant online store, priced at only 39.9 yuan, with sales of more than 200 pieces.
There were once more than 3,000 stores opened, but now the Chinese market has completely failed
As one of the first batch of overseas clothing brands to enter the Chinese market, Iger’s localization strategy is not unsuccessful. It adopts a business model of “local procurement, local production and local sales” to better meet the needs of the Chinese market. To this day, when talking about their impression of Egger, many consumers still mistakenly think that it is a “fake foreign brand”.
In fact, Etam started with underwear and socks in 1916. Although it is a French brand, its founder is German. In 1994, Egger officially entered the Chinese market and opened its first physical retail store in Shanghai in 1995. In the following nearly 10 years, Egger had a smooth journey in China. As of 2012, Egger had opened 3,460 stores in China, reaching its peak.
Eiger’s most glorious period was from 1999 to 2007, when its performance in China could maintain double-digit growth, while the profitability of France was not strong, and China The development of the region compensated for the brand’s performance in Europe, but now the situation is exactly the opposite.
But since 2012, Iger’s performance has begun to decline off a cliff. In 2012, Egger Group’s operating income in the Chinese market dropped sharply from 25.4 million euros in 2011 to 1.5 million euros. The company attributed the reason to the development of distribution channels, fierce market competition and unattractive products.
In the second half of 2014, the company began to close stores in China one after another. By 2017, Egger’s stores in China had shrunk to 2,442. Now in 2020, Egger has almost disappeared in China. Without a trace. After all, “slow” brands cannot compete with the “fast fashion” wave.
Some analysts believe that there are two main reasons for Etam’s decline in fierce competition. First, the company’s main method of expansion in China is franchising. The rapid growth of stores was once regarded as A powerful tool for increasing revenue, but over-expansion also brings hidden dangers. Problems such as customer diversion, inventory backlog, low efficiency of retail outlets, and profit sharing among franchisees have arisen one after another with the increase in the number of retail outlets. In addition, its early production model of licensing brands and agent production had loopholes, which also led to a steady stream of subsequent products.Interest disputes, laborious work.
Second, its speed of change cannot keep up with the overall industry trend. While domestic brands such as Peacebird and Oshili continue to make efforts, Etam is still standing still. Especially after fast fashion brands entered China, their rapid expansion in China also significantly accumulated Iger’s market share. Iger’s product designs are far less attractive and cost-effective than Uniqlo, H&M, ZARA, Forever21, etc.
In order to save performance in the Chinese market, Iger tried to introduce underwear stores. In November 2015, the first Egger underwear store officially opened, but it was still unable to save the brand’s decline. In 2015 and 2016, the operating losses in the Chinese market of the Egger Group reached 7.4 million euros and 19.4 million euros.
While the Chinese market was in total decline, in August 2017, Etam Développement (hereinafter referred to as “Etam Group”), Etam’s parent company, finally officially delisted.
Netizen: Youth is over
For many people born in the 80s and 90s, despite the changes in the times and the emergence of various trendy brands, Iger It is still the “White Moonlight” that impressed them most in their youth. Therefore, it was undoubtedly a bolt from the blue when I suddenly saw the news of “women’s clothing brand Egger went bankrupt” on a hot search after a long time.
Some netizens recalled that wearing Eiger was a very honorable thing when they were students. Many female college students were proud to own an Eiger dress, but as time went by, the glory was gone. Things that cannot keep up with the times will eventually be eliminated.
But more netizens still lamented: The trendy brands of their student days have become so popular, and their youth is over.
The “big names” of childhood have become the tears of the times
In fact, under the impact of the new retail model and e-commerce, Iger is not the only one who has been photographed on the shore. The big brands of contemporary young people’s student days have declined one after another…
Jeanswest, which officially entered the mainland market in 1993 and once swept through China like a tornado, is now showing signs of decline in its business in China. It has laid off more than 6,000 people, closed more than 1,300 stores, and its performance has declined by more than 65%.
La Chapelle, founded in 1998 and known as the “Chinese version of ZARA”, also declined rapidly after achieving the goal of “the first domestic A+H dual-listed clothing company” . After the high point of revenue of 10.4 billion yuan in 2017, La Chapelle closed 4,391 stores in 2019, with an average of 12 stores closed every day, while carrying a debt of up to 7.3 billion yuan. La Chapelle’s stock price also suffered a setback along with its performance. In the three years since its A-share listing, the company’s stock price plummeted 75%. The latest stock price was only 1.86 yuan, and it was on the verge of delisting.
Daphne, the “shoe king” founded in 1990, has also completely withdrawn from physical retail. From 2016 to 2019, the company suffered a total loss of nearly HK$4 billion in five years, and its stores plummeted from 6,881 at its peak in 2012 to less than 300 today. What is even more embarrassing is that in the secondary market, the company has fallen by 97% since its historical high of HK$11.17 per share in 2012, and its market value has shrunk by nearly HK$20 billion.
In this regard, some analysts pointed out that under the impact of the new retail model and e-commerce, if old national brands do not actively seek strategic transformation and upgrading and abandon the asset-heavy mentality, they will eventually fail over time. Gradually being left behind under the impact, the reshuffle of the entire domestic clothing industry may continue.
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