Fast fashion market is no longer a collective prosperity. Zara thriving, H & M, Uniqlo and Gap continued strategic adjustment, while other fast fashion brand is caught in the performance of the quagmire, fast fashion market is now in crisis.
According to Japanese media reports, the US fast fashion brand Forever 21 in Japan's first flagship store was closed on October 15. The store is located in Tokyo Harajuku, opened in April 2009, the day has attracted 1,800 consumers queuing admission Buy, and then quickly become Japan's fast fashion consumers shopping paradise.Analysis pointed out that increasingly low traffic and high rent is leading to Forever 21 Japanese flagship store closed the main reason.
Forever 21 first flagship store opened when the crowded
With the emergence of Zara, H & M and other fast fashion giants have entered the Japanese market, the emergence of Japanese local brands Spinns and WEGO, as well as the rapid rise of fashion electric business, Forever 21 core consumers continue to drain Forever 21 was founded in 1984, 30 years Grow into one of the world's largest fashion chain, now in the world more than 700 stores, but most of the United States.
Earlier rumors Forever 21 due to the continued decline in sales in Australia, its flagship store in Sydney is about to close, the shop will be replaced by Woolworths last year, the news also refers to Forever 21 retreat, since early April announced the exit from the Scottish market , Began to reduce its UK market store area, and even possible to withdraw from the British market.
In the Chinese market, Forever 21 has been in Shanghai has opened four stores, some analysts pointed out that, Forever 21 experienced a rapid expansion has also begun to fall into the performance of the downturn.There are Chinese consumers reflect the past year Forever 21 product design Not suitable for Chinese consumer demand, American short blouse and too short skirt the practicality of the discount, shop a large number of hoarding goods, traffic is also significantly reduced.
The picture shows Forever 21 Hong Kong Causeway Bay flagship store
Forever 21 closed the Hong Kong area of Causeway Bay Jinghua Center, a total of 6 storey flagship store, only to keep a small store in Mong Kok, the original flagship store will be taken over by Victoria's Secret. It is reported that the flagship store building Rent and its expensive, the initial opening has been as high as more than 1000 million Hong Kong dollars, the brand must ensure that every few months to sell a few clothes, accessories are possible to ensure profitability.
In addition to poor store performance, fast fashion in the past, time-tested creative plagiarism is also being challenged.The most notorious is Forever 21, this year has been Puma, Gucci, adidas trademark infringement allegations.
In April of this year, Puma formally filed a lawsuit in US court, saying Forever 21 copied and sold its best-selling Fenty by Puma's behavior was not only an insult to Puma and designers, but also a threat to Puma's entire business.
And then Forever 21 and Gucci for six months of trademark disputes is caused by the industry close attention. Forever 21 said in February this year, Gucci lawyers received three warning letters, asking them to stop selling some striped pattern of clothing and accessories. Month, Forever 21 decided to formally initiate a lawsuit in Gucci to the court before the request to cancel the Gucci 'stripe' trademark in the United States. In response, Gucci in August this year decided to formally prosecute Forever 21 on its iconic red and blue stripes design plagiarism The
This year, Forever 21's infringement dispute also involved the German sports brand adidas and the American Family Planning Union.
Apparel business more and more difficult to do, Forever 21 also played the idea of beauty business, not long ago formally into the makeup industry, plans this year before Christmas holidays, the first in the United States to open 10 beauty shop Riley Rose preliminary attempt , If the market response is positive, will be opened in March 2018 10 before.
In fact, not just Forever 21, fast fashion brand days are not too good recently.
Is also the first flagship store, located in Beijing Xidan Joy City, the northern end of the entrance of the H & M stores recently had the same experience, 'was removed shop' news caused an uproar .Analysis, according to fast fashion into China signed More than a decade of practice, the lease did not expire, means that Joy City braved the price of liquidated damages, but also H & M out of the pavement.
And 10 years ago, H & M first stationed in China's lively situation compared to today's fast fashion brand market position and bargaining power has been quite different.While the Xidan Joy City store is the first time in 2009, two in Beijing One of the home.
While H & M is becoming more and more slowly, according to its earnings report for the first nine months of the year ended December 31, 2011, the Group's sales rose 7% YoY to SEK133 billion, or about $ 21.2 billion Slow, lower than expected.
The picture shows Beijing Joy City H & M shop
There are more and Forever 21 positioning similar to the fast fashion brand is experiencing difficult times. British fast fashion brand New Look first quarter profit fell 60.3% .According to its first quarter of fiscal year 2017 earnings show that sales fell 4.4% To $ 338.7 million, operating profit fell 60% to £ 12.1 million, with analysts saying that due to the UK's efforts to keep the British retail industry vigilant and is now in China's radical expansion and local recession, New Look Is facing the challenge of high risk.
In China crazy expansion of swallowing the fast fashion brand New Look
Another UK fast fashion brand Next Group sales fell 2.2% in the first half of the year in the first half of July 31, Next Group sales fell 2.2% to 1.194 billion pounds, profits fell 9.3% to 307 million pounds Of which the core brand Next sales fell 8.3% to 9.93 billion pounds, the performance of the decline mainly by the physical store sales bleak influence, will continue to close 13 stores.
By the same factors, by the end of January 2015, the British fast fashion brand Topshop announced the closure of all five stores located in Japan, officially withdrew from the Japanese market. Group as of the end of August 2016 fiscal year, by the fierce competition in the market, the Group sales The amount fell 2.5 percent to 20 billion pounds, net profit fell 16 percent to 211 million pounds.
At the same time, the top shop in Austradia, Australia's Austradia days is not better than the data show that Austradia in the month ended June 28, the net loss of 3 million Australian dollars, began to enter the bankruptcy process, but the latest news is, Topshop has Decided to continue to operate the brand in Australia's existing four direct stores.
Topshop opened its first store in Australia in 2011. Its rivals, Zara and Gap, also entered Australia in the same year, while Topshop's expansion was too slow, and O'Reilly International analyst Bettina Kurnick said that with Zara and H & M Fast fashion brand, Topshop, whether in pricing, product portfolio or product update cycle, do not have the advantage.With Amazon and other large retailers have begun to pay attention to the Australian market, Topshop future will face more difficult challenges.
It is clear that high operating costs are one of the most important reasons for the crisis in the fashion crisis.With the increasing impact of the electricity industry on the industry, physical stores have become cumbersome for fast fashion, and retail research firm Fung Global Retail & Technologh released this year A report entitled 'Fast Fashion Speeding towards Ultra-Fashion' report, the European fashion business platform is to the original response to consumer demand, continue to bring fresh taste of the traditional fast fashion brand challenges. To the shelves of the shorter time, fixed time to update the product more, is the 'ultra-fast fashion' (Ultra-Fashion) for those increasingly difficult to meet the consumer.
The report provides three internal data for UK retailers that are thought to be faster than traditional fast fashion, namely Boohoo, ASOS and Missguided. The data show that Boohoo.com, ASOS and Missguided are now able to produce goods in 2-4 weeks , Zara and H & M are 5 weeks, and traditional retailers need 6-9 months.Misguided able to do a monthly launch of 1,000 new products, updated once a day inventory. ASOS can also be done in 2-8 weeks Product flow, the average time to market about 6 weeks.
These ultra-fast fashion retailers avoid the inherent problems of traditional retail, that is, product shortages and excess inventory, and the consequent price and profit margins decline.Extur fast clothing retailer's supply chain is always agile, can quickly match the inventory Supply and demand, and strictly control the inventory, in the supply shortage and price balance between the initial product design is the first small batch production, testing consumer feedback, if successful, and then fast replenishment.
To Boohoo, for example, the first time on a new time, each piece of goods inventory of about 300 or so, as occasionally added. ZARA out of 120 new every day, and Boohoo current daily number reached 200, its website A total of about 29,000 kinds of products.In addition, Boohoo design production process is 4-6 weeks, the fastest to reach 2 weeks.
Performance data also support the positive trend of fashion electricity by the young consumers sought after, the British fashion business ASOS annual sales rose 33%, according to its full year 2017 fiscal year results show that its sales year on year Up 33% to 1.92 billion pounds, gross profit close to 1 billion pounds, pre-tax profits rose 145% year on year to 80 million pounds, full-price product sales increased significantly, its own brand sales accounted for 41% .In addition to apparel products , ASOS is also constantly expanding its product category, will be extended to ski and surfing and other sports products and skin care beauty field.
CEO Nick Beighton said that ASOS is getting more and more young people's favorite, ASOS in the reporting period the number of active users increased by 24% .In fact, fast fashion opponents not only specialized fashion business, as well as Amazon so Of the public electricity business giants, the latter more and more obvious ambitions of fashion.
Not long ago, Amazon's own fashion brand The Fix on-line, officially to Zara and other fast fashion brand challenge.It is reported that The Fix first series contains a total of 45 products, priced at 49 US dollars to 139 US dollars between the new month , Now only for the Prime members launched. Amazon fashion director Kate Dimmock said, The Fix is Prime members of the value-added services, Amazon's fashion buyers will be from the fashion industry to find the most popular things, fast fashion operation to update the goods.
And Amazon announced in June this year, the release of the trial version of Prime Wardrobe 'try to buy the same service to the rapid fashion apparel poses a threat to Amazon's shopping experience to further improve, no doubt make up the electricity business can not try short board, while breaking It is reported that the Prime Wardrobe service will cover more than one million items of merchandise.
Some analysts believe that Amazon in the logistics experience and other sales of technological innovation may be more potential for the future, a solid scientific and technological support and infrastructure construction will gradually open the Amazon clothing and fast fashion between the distance.For example, Zara cited The trend of the trend of the database is likely to be Amazon from the huge customer base to collect large data to replace another analyst believes that Amazon's up to $ 1,000 stock price is based on the market for its 20 years after the value of the forecast.
In the impact of electricity business, once favored fast fashion brand has been crisis, even the industry leader Zara can not relax vigilance.
Driven by exchange rate fluctuations, the first half of this year, Zara parent company Inditex Group sales continued to rise while gross margin fell sharply, recorded 56.4%, which means that its fast fashion brand profitability is being hit, especially in the second quarter, its hair Interest rates fell to 54.8%, while net profit only recorded growth of 1.5% to 712 million euros.
Societe General analyst Anne Critchlow said: 'The second quarter gross margin lower worries, the market will pay special attention to this indicator in the next year will be how to develop, more importantly, the market has realized that the euro may be strong Continue to put pressure on sales growth.
Agence France-Presse analyst Anne Critchlow worries about the decline in profitability of the Inditex Group, saying that the volatility of the euro's exchange rate will further weaken the price advantage of Zara's fast fashion brands in the market and expect the Inditex Group's gross margin to fall further in the second half of the year.
In order to stimulate the performance growth, from 2015 onwards, MUJI began in China more than 260 categories of goods prices by 20%, and the purpose is to further expand the price advantage through the consumer layer in the Chinese mainland market, MUJI since 2014 October down the price of the product is expected to be the fastest in 2018 to achieve the basic price of China and Japan.
Spain's fast fashion Mango also announced its leisure series price cuts, down by about 15%, while UNIQLO is also the full implementation of price reduction measures, its parent company chairman and CEO Yukai has said that consumers do not agree with the new Product is equal to the high price, fashion retail environment is now very difficult, the company in this environment to improve the price is a mistake, while H & M has been to attract eye-catching cross-border cooperation models to improve the price of its goods.
In order to seek transformation, Topshop's first step to take the price strategy.In September this year, Topshop that is to see the big show is no longer released with its high-end series 'Topshop Unique' named, but changed to 'Topshop London Fashion Week' And the price is more close to the previous people after the Topshop Unique series the highest price of up to 700 pounds, while the latest Topshop London Fashion Week series price is between £ 39 and £ 650, and more than half of the new clothing has been in the official website , Are the price of not more than 200 pounds of products.
Analysts, Topshop this move confirms earlier Philip Green proposed price reduction and brand positioning and other transformation strategies, with Instagram and other social applications in the popularity of young consumers to enhance the young consumers on the Topshop high street fast Fashion brand love and dependence is gradually reduced.
Philip Green in an interview with the British "Guardian" interview also admitted that the face of the British retail industry continued to slump, Topshop high street status is no guarantee, in addition to lowering the price of Topshop products, but also speed up the digital process to deal with Boohoo.com, ASOS Such as the rise of fast fashion business.
Earlier this year, Zara suddenly closed its first flagship store in China, which is located in the former shopping center in Chengdu, China. According to the fashion headline data, Zara's clothing sales in the Chinese market since last year fell by an average of 10% to 15 %, Which may reflect from the side of the group in the Chinese market growth rate may not be expected, began to feel the fast fashion competitors and domestic apparel brands began to rise in the fierce competition.
This also means that the bottleneck into the fast fashion brand is experiencing a collective confusion, the price war is explosive.