The fast fashion camp is divided. Unlike ZARA, which completes the design and production process of clothing within two weeks, Uniqlo now takes the completely opposite approach. The design and production cycle of its clothes usually takes about a year. Uniqlo abandons the fast fashion label, is it no longer one of the top four fast fashion brands in the past? Still in need of transformation and upgrading, this issue’s special feature is a panoramic scan of Uniqlo.
UNIQLO focuses on high-quality clothing and does not want to be synonymous with cheap
The fast fashion camp is divided. Unlike ZARA, which completes the design and production process of clothing within two weeks, Uniqlo now takes the completely opposite approach. The design and production cycle of its clothes usually takes about a year.
In order to provide consumers with “non-disposable and high-quality” clothing, Uniqlo launched a LifeWear series in 2013. Tadashi Yanai, CEO of Fast Retailing Group, said: “Unlike fast fashion, which only focuses on new trends, Uniqlo focuses on something completely different. In the concept of the brand, LifeWear refers to high quality, fashionable styles, affordable prices, and comfort. Daily clothing. “The CEO once said that Uniqlo will become the world’s number one clothing retail brand by 2020 and is currently expanding at the rate of opening 100 stores in mainland China every year.
Uniqlo continues to close stores in the United States, becoming increasingly weak and losing to Primark
Japanese brand Uniqlo may suffer a second setback in the U.S. market. Not only did the company’s 200 store plan for 2020 released in 2013 fall through, but due to fierce competition, Uniqlo has closed 5 U.S. stores since January.
According to the New York Post, Uniqlo has closed five stores in Dambree, Connecticut, Cherry Hill, New Jersey, Willow Grove, Pennsylvania, Northridge, California, and Staten Island, New York.
In response to the setback in the development of Uniqlo’s U.S. market, some investors have called on Fast Retailing Group to withdraw from the U.S. market again. However, some investors also said that continuing to stick to the U.S. market will help enhance the brand’s influence and popularity, allowing it to sell at higher prices. Other markets earn higher profits. Based on the current situation of Fast Retailing Group, it is obvious that the suggestions of the former part of analysts are more realistic, while the suggestions of the latter part of analysts have been proved to be wrong, and Uniqlo is correcting its price increase strategy.
Uniqlo wants to transform, and fast fashion will be blamed for any disagreement
Uniqlo has far-fetchedly defined “fast fashion” into the concept of “poor quality”. What is its intention? It always feels like it reveals a strong flavor of conspiracy. Let data and facts speak for themselves.
Let’s first take a look at UNIQLO’s financial statements for 2015 and 2016: The consolidated financial report (International Accounting Standards) from September to November 2015 released by Fast Retailing, the parent company of UNIQLO, showed that the net profit was only 48 billion per day. Yuan, down 30% year-on-year, with profits falling for the first time in five years in the September-November financial quarter. Sales were 520.3 billion yen, a year-on-year increase of 8%.
Fast Retailing’s financial report for the first half of 2016 showed that Fast Retailing’s global sales rose to 1.1116 billion yen (approximately RMB 60.87 billion), but operating profit fell 33.8% year-on-year to 99.3 billion yen (approximately RMB 5.98 billion). billion), at the performance report meeting, Yanai Masaru said: “This period’s performance is unqualified, only 30 points.”
The data of the two years are worth pondering, with sales increasing and net profit declining. Strategically, it is expanding, and the number of directly operated stores is increasing, but overall profits are declining.
During this period, the net profit data of similar brands H&M and GAP have also fallen one after another. The domestic fast fashion brand Baleno has directly made the headlines of Tencent Finance a few days ago, “The smash hit domestic clothing giant fell and was sold off for 250 million yuan.” . It seems that “fast fashion” is really going to die, and pessimism and self-help are flooding the entire clothing retail market; coincidences and opportunities make the entire clothing retail market seem to be brewing something unknown.
UNIQLO intensifies its efforts to restructure, improve brand fashion and create a clothing empire
Recently, Japanese clothing brand Uniqlo is preparing to use its mass production capabilities to create a clothing empire and fill its shelves with affordable, high-quality products, such as down jackets, underwear and T-shirts.
This retail company with 1,734 chain stores and products in 17 countries now wants to defeat Western giants Gap, H&M and Zara and become the world’s largest fashion manufacturer.
In the ultra-competitive casual fashion market, size matters, but it doesn’t guarantee success: Analysts say Uniqlo’s biggest challenge is carving out its own brand identity, rather than just offering high-quality, affordable products.
Ten reasons why Uniqlo doesn’t want fast fashion labels
1. The novelty of fast fashion among Chinese people has passed. The so-called fast fashion does meet the needs of the first and second tier markets, but it cannot penetrate into the real Chinese market of the third and fourth tiers;
2. The label of fast fashion means that we are more sensitive and agile in grasping fashion trends, focusing on speed and freshness, and truly selling clothes like bread, for one-time consumption;
3. Fast fashion brand clusters. After several years of market testing, consumers have fully experienced the so-called fast fashion style in Europe and the United States.In fact, it is just a cheap brand with a fashion label;
4. The so-called fastness of fast fashion brands cannot meet consumers’ lifestyle needs. On the contrary, their homogeneity and low cost performance have seriously restricted their domestic sales growth;
5. Fast fashion brands, including Uniqlo, are popular and affordable brands in their home countries. However, in order to reflect their superiority in the Chinese local market, their brand positioning is being elevated, and they deliberately avoid connecting with local affordable brands such as Smith Barney, Semir, and Yichun;
6. The improvement of brand positioning has indeed satisfied the consumption needs of consumer groups who are ignorant of fashion in recent years. It just caters to the desire for foreign brands in the transformation stage of domestic channel models to shopping malls. Super local brand treatment is given to such so-called international brands. Opportunities for the rapid development of fast fashion brand groups, and the establishment of entry barriers for local affordable brands by shopping malls have also led to the emergence of international fast fashion brands;
7. The failure of Uniqlo’s first entry into the local market led to a higher brand positioning when it entered the Chinese market for the second time. It just catered to the good opportunity for the transformation of the domestic channel model at this stage and saved Uniqlo’s business crisis caused by the decline of the domestic market;
8. UNIQLO’s products are versatile and are not as fast as other European and American fast fashion brands in terms of fashion trends. Their prices are also slightly lower than those of European and American fast fashion brands, making them more cost-effective. This is only reflected in knitted products;
9. After 3 to 5 years of rapid development in China’s first- and second-tier markets, UNIQLO has clearly understood that continuing to wear the so-called fast fashion label brand will not really help UNIQLO sink into the third, fourth, fifth, and sixth tiers. Fashion or fast will not help China’s third, fourth, and fifth tiers. Liupu is really not too important to the consumer public. Low-price, cost-effective and versatile brands are the mainstream demand;
10. How far can UNIQLO go when it comes to its third choice? Giving up fashion brands and returning to affordable national brands in Japan means the loss of the fashion consumer groups that have accumulated in China’s first and second tier markets, and the importance of the brand. Plastic needs a process, and it must also face competition from many affordable brands in China. Does Uniqlo have the patience? Or does Uniqlo have the opportunity?
We will continue to track how Uniqlo will transform and upgrade after giving up its fast fashion brand, and how the fast fashion brand market will be involved in more intense competition…
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