In September, Su Ming was obviously much busier than before. He kept busy all day long. As he was about to get off work, another foreign trade company in Hangzhou called to inquire about the purchasing estimate of two plaid fabrics. Su Ming is the general manager of a fabric manufacturer in Jiangyin and has been involved in the textile industry for more than 20 years.
The number of customers inquiring about plaid fabrics has increased significantly recently, and ZARA is also contacting him about purchasing plaid fabrics. “The colorful plaids are vying for beauty. This year and next will be the explosive years for plaid coats.” Su Ming wrote this in his work diary two weeks ago. As an upstream person, he can always be the first to sense the fashion trends of the next season.
Su Ming can also be the first to capture the signals of brand rise and fall. Su Ming has had contact with some well-known domestic mass apparel brands such as Metersbonwe, La Chapelle, and Yichun. Su Ming is not surprised that some well-established domestic shoe and apparel brands have recently closed stores, left the market, and experienced sluggish growth.
Side effects of dilation
In the past two years, the tight capital chain is a common feature discovered by Su Ming. “Their biggest drawback is that payment is too slow, and the payment period must be at least three months. If the funds cannot be transferred, it is equivalent to occupying our own funds.” La Chapelle was also a regular customer of Su Ming. Last year La Chapelle Bell’s payment for goods has been delayed for a year. Starting from May last year, Su Ming slowly terminated the cooperation with La Chapelle. According to Su Ming’s knowledge, there are also large fabric suppliers that have been pressed for tens of millions of payments. , “It is true that the more you do, the more tired you are.” In contrast, the payment settlement time for export clothing brands is at most one month.
The tightening of the capital chain is the result of problems in brand operation. In Su Ming’s view, the result is The reason is largely due to the blindly optimistic judgments of local clothing brands about the market in the past few years.
“They always think that as long as they can produce it, they can sell it. If every boss thinks this way, in the end it will be Supply exceeds demand.” Su Ming told reporters that in the past few years, fabric procurement required spot production. For example, when I came to purchase today, I had a hunch that a piece of clothing could be sold for 20,000 pieces, and the demand for fabric was 20,000 meters, which would take 3-5 days to produce.
The construction period is short and the cost is high. At the same time, the sales volume is judged based on “beating the head” and “trying luck.” When the market was good in the past few years, there was no problem with mass production. Once the market went bad, it would eventually become inventory.” In contrast, Su Ming’s description of foreign brands is “rational” and “accurate in volume.” Take Uniqlo as an example. They use an order system. 20,000 meters of fabric need to be ordered at least one month in advance.
Currently, according to Su Xin’s observation, the industry has generally shifted to an order model, but the inventory accumulated in previous years is constraining This is a reality that the domestic garment industry has to face, and this epidemic has exacerbated this problem. Judging from the overall performance of the industry, as of June 30, 2020, there were 177 listed companies in the textile and apparel sector of the Shanghai and Shenzhen Stock Exchanges (A-shares), with an inventory turnover period of 232.33 (days), an increase of 35.08% over the same period last year. At the same time, in the first half of the year, the losses of companies in the textile and apparel sector reached 24.86%, and more than two-thirds of the listed textile and apparel companies’ mid-year income declined to varying degrees compared with the same period last year.
Judging from the semi-annual reports released by some listed apparel companies, Heilan House’s inventory reached 8.218 billion yuan, accounting for 10% of the current period’s The proportion of operating income is 101.43%; Semir clothing inventory is 3.957 billion yuan, accounting for 69.01%; Metersbonwe inventory is 2.053 billion yuan, accounting for 37.58%.
In the years when local clothing brands were aggressively trying to seize the market, the inventory problem was covered up, and even more To be precise, the brand originally thought that inventory was the support for corporate scale, but it did not expect that inventory would become a “side effect” and then develop into a “chronic disease” that drags people down.
Taking Metersbonwe as an example, the “agency + franchise” sales method has increased the number of intermediate links in the supply chain. Cumbersome, inefficient and inflexible. The accuracy of inventory sales forecast is poor. By the time evaluation indicators such as inventory turnover rate come out, inventory management problems are already a result and cannot be corrected. In the early days of listing, in order to expand its scale, Metersbonwe also proposed a rigid target of “25% annual increase” for franchisees.
Su Ming had intuitive feelings about the complexity and inefficiency at Yichun. “Their management system is like that of an elderly person,” Su Ming told reporters. Only two people can negotiate the purchase of fabrics. In the WeChat group with Yichun, there are at least a dozen people. “They even have to stamp and print. Two dedicated people are responsible for it.”
In addition, the complexity is also reflected in the demand for fabrics. Su Ming told reporters that the fabrics purchased by domestic brands are relatively scattered. One kind of fabric is picked thousands of kilometers away, with many varieties and small quantities. Moreover, every promotion requires fabric factories to bring new fabrics. “Designers think consumers like new fabrics,” Su Ming told reporters. I like new things, but in fact, some classic fabrics are more popular.”
Difficult to copy ”
Standing on the fabric link.It is difficult for original brands to achieve good development without sufficient funds and stable promotion channels. “Xiaoyu also said this.
Being trapped everywhere and blocked, don’t local brands have no chance? Su Ming noticed that although the industry is in trouble, there are also some new “trends” worthy of attention.
On the one hand, technology is “making suggestions” for the industry. Recently, Alibaba officially announced new manufacturing- – “Rhinoceros Intelligent Manufacturing Factory” hopes to apply digital insights in the manufacturing process to achieve true integration of production and marketing and help small and medium-sized businesses solve pain points in the production supply chain. According to industry insiders, “Rhinoceros Intelligent Manufacturing Factory” may Solve the shortcomings of the long-standing “production-based sales” model in the apparel industry, minimize trial and error costs, reduce inventory pressure, and provide stronger resilience for small and medium-sized enterprises with weak ability to resist risks.
On the other hand, Guochao has begun its road to revival; there are also some old brands that are constantly being impacted and are also desperately trying to save themselves.
In the past two years, national fashion has become the main keyword for brands to compete. The scale of China’s sportswear industry reached 114.7 billion in 2018, with a growth rate of more than 9% for two consecutive years. Li Ning relied on Taking advantage of the national trend, it has participated in the International Fashion Week for the third time. Not to be outdone, Anta has acquired many foreign brands, and even Taobao brands have won the favor of celebrities. The revival of the national trend contrasts with the decline of fast fashion.
There are also brands that are finding new ways to save themselves. Semir’s Balabala children’s clothing brand is the product of its self-rescue. After being praised by its peers In addition to the squeezed adult consumer market, it has opened up the children’s clothing market to save the curve. Peacebird breaks the data barriers of online and offline departments, relying on new online feedback to find popular products in a short period of time and pursue orders or develop new designs. Supplement; All departments have changed from the original method of receiving hot sales instructions in order to a round table discussion system, and all departments act simultaneously around hot sales…
Thousands of sails pass by the sunken boat, and thousands of trees spring in front of the diseased trees. Where is the way out for domestic brands? It is true that China’s garment industry has reached a crossroads and is going through a period of “pain and joy” transformation.</p
