The Puzzle Of Fast Fashion Competition

One of the characteristics of the joint venture model is: clothing The cooperation between brands and shopping malls will often increase the cost of businesses and push up commodity prices. The direct marketing mode bypasses the intermediate links of all agents and sells the clothes designed and produced by itself directly on the market.

The brand new MANGO direct stores really add color to the brand. The flagship MANGO store located in Shanghai 353 Square cost more than 10 million yuan, but it became the sales champion of MANGO Shanghai in the month of opening. Not only MANGO, ZARA, H&M Uniqlo 、 C&A and other companies have aggressively penetrated into second tier cities and added direct stores.

In an interview with a reporter, Karl Johan Persson, President of H&M, said that China was the country where H&M opened the most stores in 2012. "Although there are a lot of opportunities in China, the competition is becoming increasingly fierce."

H&M entered the Chinese market in 2007 and now has 64 stores, a total of 2410 stores in the world. According to the analysis of Swedish Commercial Bank, H&M's profitability in China is stronger than in any other market. It is expected that the number of H&M stores will triple in the next three years.

Inditex annual report shows that in 2008, there were only 23 stores of ZARA in China, which increased to 44 in 2009. In 2011, the number of new stores of ZARA in China reached 120, and it will expand to second tier cities such as Harbin and Kunming. Chinese market becomes ZARA overseas market One of the fastest growing regions in China. As the highest sales clothing retailer in Japan, most of Uniqlo's new stores are planned to open in the booming Asian market, including 100 new stores in China every year.

In fact, Abercrombie&Fitch and Topshop are also looking for a foothold in the Chinese market, and some Chinese brands aiming at "fast fashion" are also looking for the transformation of channel mode. However, direct marketing has also raised the requirements for enterprise management.

"The size of stores like ZARA and H&M is too large, and the cost of capital and manpower is very high. And for ordinary enterprises, it is impossible to get such a good location even if they have funds. ”Said Dan Fei, general manager of Ayanami China.

In fact, the pure direct sales model is not the mainstream in the domestic clothing circulation industry, because enterprises have to spend a lot of money on store and service management, and also have to lower commodity prices. Where does the profit come from? "Cost control can almost only be achieved from the garment manufacturing link, and the control of production cost will add pressure to the garment OEM industry, which has been dancing with shackles," said Cui Hongbo, CEO of Lianzongzhida Brand Management. However, fast fashion brands are not in place in terms of management, and problems are inevitable when the cost pressure increases.