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    Business News

    Why can't Chinese mainland brands like Zara-style fast fashion brands?

    For the modern apparel retail industry, the Spanish brand Zara (Special Reading) is a model. They have an average of 11,000 styles per season, while most other brands have 2,000 to 4,000 styles. Zara customers average 17 visits a year, compared to 3 to 4 other brands. Zara averages 2 to 4 weeks from development to new listings, and H&M averages 3 to 5 months, while most Chinese local brands currently have a period of 6 to 9 months. Rich product selection and high-speed commodity turnover make Zara the target of Chinese local apparel brand competition.

    However, many Chinese brands that claim to be fast fashion (special reading) do not seem to grasp the root cause of Zara's ability to achieve fast fashion. So much so that China has a number of "fast fashion" brands with famous points but no facts. In fact, Zara is fast because of its flat organizational structure, large and direct retail formats, and its own supply chain system supported by high technology.

    The manager of most retail stores, if they need to report any questions to the company headquarters, or report any work, usually through their supervisor - the regional manager (district head), then the district governor reports the retail (sales) manager, and then The manager reports the brand or business director. For the retail industry, the store manager is actually one of the important positions. But most companies set them as levels. The authority of the store manager is basically limited to selling goods; managing the store staff; maintaining the display; the store can not go wrong.

    Most of Zara's single-store sales have reached 100 million yuan. To manage the scale of such a store, the store manager needs to have the equivalent of a general manager of a small and medium-sized enterprise: in addition to the daily work that the general store must do, such as selling goods; warehouse, personnel and cash management, they differ from ordinary store managers in their Goods management rights. This privilege includes ordering, replenishment and goods display. In this way, these front-line staff can issue replenishment orders to the company in a timely manner according to the actual sales situation. In other brand companies, these jobs are basically completed by the Commodity Department of the company's headquarters. The flaw in this process design is that these people sitting in the office can only wait for the system data to react and make judgments, and the efficiency is significantly lower. Zara's store manager will meet with the Spanish headquarters every 1-2 weeks to discuss new product design, sales feedback, replenishment needs, etc., and it is difficult for general brand managers to have such opportunities to directly communicate with relevant departments of the company. This makes the Zara store's problems in the first line can be fed back to the company's top management in a quick time. Undoubtedly, all this also shows that Zara's manager is extraordinary: they must graduate at least undergraduate, understand English, excellent execution, hard work, and working overtime until early morning is commonplace. Of course, the treatment that matches them is also top-notch in the industry. In first-tier cities, the store manager of a brand store generally receives a monthly income of 5,000 to 6,000 yuan; Zara's store manager is more than 10,000 yuan.

    For the time being, no matter whether the Chinese local brand can give the store manager the same rights and responsibilities. In fact, Zara is able to set up such an organizational structure, which is closely related to its retail model. Zara basically stores 1,000 to 2,000 square meters, and is located in the commercial center as much as possible. The vast majority of offline clothing brands in China, the retail format is mainly department stores. Although department stores are currently facing unprecedented challenges, they are still the main form of retail in China. For malls that pay attention to the performance per square meter, the area they provide to brand companies is extremely limited. For such small and medium-sized stores, Zara's store manager model is difficult to promote. The performance of the brand single store sold in the mall is only a few million yuan a year. It is impossible to produce hundreds of millions of benefits like Zara, and it is impossible to allow the brand company to hire high-ranking store managers with high salaries. The Chinese clothing brand, which is dominated by franchisees and supplemented by direct sales stores, lengthens the length of the entire information decision-making process and determines that Zara's organizational structure cannot adapt to Chinese brands.

    Another advantage of Zara is its excellent supply chain system. The founder of Zara decided to do fast fashion very early, so he did not hesitate to invest in the supply chain system and related information technology. They have their own factories and more than 60% of the world's products are supplied by their own factories. These factories are all located near the headquarters. At the same time, it also cooperates with some workshop-style family factories in Europe. These small factories provide considerable convenience and flexibility for small order testing. Usually, Zara will first put the new model in some stores to test sales feedback. These orders are small in number, so they happen to be completed by a small factory. Subsequently, after the order test is successful, they will immediately make up the order and increase the order quantity, and it will be completed by the factory or the cooperative factory. Most local companies in China do not have their own factories, but outsource production. Even with its own factory, it is far less professional than Zara in the construction of the supply chain system. In order to continuously optimize its ordering and replenishment processes, accurately predict sales, and optimize inventory management, Zara will work with international top universities such as MIT (Massachusetts Institute of Technology) to explore optimized inventory management for them. mode. This is the weakness of Chinese companies. Although there is no shortage of institutions of higher learning in China, the research in many disciplines is divorced from the actual needs of enterprises. Chinese companies do not believe that academics can bring better benefits to their own businesses, but they do not have the ability to self-organize the system. This is why Chinese local clothing brands are difficult to replicate Zara's fast fashion.

    In short, Zara's case is only to show that many times our domestic brands may only be effective in the East. They know it, but they don't know why. Such imitation may only be a waste of time and effort. Of course, this is not to say that Chinese local companies can't get a fast fashion model, but they must explore a path that suits their brand positioning and business model. In fact, there are individual Chinese local brands that are already exploring their own fast fashion path. For example, the Handu clothing house, which is a brand of Amoy, breaks the situation of the design department, the production department and the sales department in the traditional organizational structure. By setting up a three-person team department - "designer, production order, marketing," They were originally in a state of unity and integrated into one department. Accelerate product development and time to market through a small team of integrations. La Chapelle relies on the “partner system” of the store to make traditional store employees only responsible for sales, profit from wages plus sales, and conversion to stores requires control of operating costs and profitability. In return, shop employees can share the profits of the store like shareholders. This actually encourages every shop member to regard the store as their own company rather than working as a working person. This incentive system has greatly improved the efficiency of the company's operations, which in turn has made "fast" possible.

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