Do domestic garment industry suffer from internal and external problems?

When the Wahaha Group's second generation Zong Jiali, New Hope Group's second-generation Liu Chang, and Huawei's second-generation Meng Wanzhou have already emerged in their respective companies, the second generation of clothing manufacturers in China's traditional manufacturing industry is gradually leaping up. On the stage center.

The difference is that compared to other industries as a whole, the domestic apparel industry has experienced several years of decline. There are luxury brands such as Armani, under the double attack of Zara and other overseas fast fashion, domestic clothing giants Cross-border transformation and self-salvation are performed every day. Under such circumstances, the burden on the shoulders of clothing companies' second generations is even heavier.

The second generation came

As the New Year opened, the Haishu Group announced the succession of the second generation. On February 8, Zhou Zhiping, the son of Zhou Jianping, the chairman of Haishu Group, was formally appointed as the president of Group Co., Ltd.

According to public information, Zhou Lizhen was born in 1988 and is only 29 years old. He studied at Tsinghua University and majored in finance. After graduating in 2010, he worked for an overseas investment fund management platform focused on investing in the Chinese market in Shanghai. He worked at Haishu Group headquarters two years later and worked successively in the advertising department, commodity center, and information center. And electricity providers and other departments.

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Within the Haishu Group, many people have called him "Marshal."

Do not let the eyebrows. A few months before "Marshal", another second generation in the clothing circle has already taken over the responsibility of the company. She is Hu Jiajia from Smith Barney.

In addition to gender differences, Hu Jiajia and Zhou Lizhen took over the business operations of the company is also a world of difference.

“The House of Haishu can be said to be the most bullish company listed in the apparel industry last year, but Smith Barney has already left the altar.” said an anonymous reporter who told the New Financial Observer.

In the first half of 2016, the net loss of Smith Barney reached 60,109,800 yuan.

In November of the same year, Meibang issued an announcement that Zhou Chengjian, the 51-year-old founder, resigned as chairman, director, member of the board of directors, and president of the company. Among them, the positions of chairman and president will be taken over by his daughter Hu Jiajia.

After resigning, Zhou Chengjian will not hold any position in the company. This type of completely free handedness is rare in the industry.

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The industry generally believes that this is related to Zhou Chengjian’s previous involvement in Xu Xiang’s case. "This move can be seen as an account of the external capital market, of course, does not rule out internal forced behavior." The aforementioned industry sources said.

In conjunction with the news, there was news of a 100% stake in Smith Barney, a subsidiary of Smith Barney, which was the second subsidiary to be sold within two months.

The purpose of the sale is self-evident. Since Smith Barney’s loss began in 2015, if it continues to lose money, it is very likely that it will be ST in the future.

However, Hu Jiajia, born in 1986, Bachelor of Marketing at Aston University and Master of Marketing and Fashion Marketing at Marangoni College in London, may have been prepared for the current mess.

Hu Jiajia began working at Smith Barney in 2011 and successively rotated positions in the president's office, footwear development and operation department and many other departments. This five-year period is exactly the time when Smith Barney gradually fell from the altar and began to fall into trouble.

Transfer on the road

“These two companies are publicly handed over, and there are also some special circumstances related to the company itself. In fact, most of the apparel companies have been training the second generation. It can be said that the second generation of the companies are on the way to succession.” said the industry insiders said .

Zhao Huakang (a pseudonym) is such a successor who is on the road. His understanding and familiarity with family businesses started from a very young age.

Zhao Huakang, 29, is a clothing company in Tianjin responsible for marketing and e-commerce business. His father is the company's chairman and general manager.

According to his memories, he had very few opportunities to meet his father before the age of seven. Their family is a southerner, because his father had been working in Tianjin in his early years and he could not return home several times a year.

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"During 1994 and 1995, my dad opened a garment factory in Tianjin and settled me and my mother after they settled in." Zhao Huakang told the New Financial Watcher.

During the 6 years of junior high school and high school Zhao Huakang’s winter and summer vacations were spent in the factory. "When Dad met some customers in high school, he took me with him. At the time, he only introduced people to me and said that I was his son. I basically didn't talk much. I just watched how they communicated."

After graduating from high school, Zhao Huakang went to London to study and specialize in marketing, during which he worked in an international clothing brand store.

In 2010, Zhao Huakang returned from school. At that time, he had no intention of deciding to work for his father’s company. “I have been in the factory since I was a child. Many things have become tangible, and it is not easy for my dad to do such a big business. I think I should help him share some of it. Of course, I started from the most basic salesperson." Here, his words carry a hint of pride.

In the following years, Zhao Huakang worked in various departments until today responsible for marketing and e-commerce business.

Today, Zhao Huakang does not have a formal position in foreign countries, but these two businesses are still solely responsible for him. "On the one hand, my major is marketing and I have experience working overseas; more importantly, I start from the grassroots level step by step. People in the company are also more convinced," he said.

As for when the company will formally take over the business, he said frankly: “My dad never talked to me about this issue. I think he still feels that I don’t have enough heat and I want to exercise again.”

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Wang Quanlai, secretary-general of the Tianjin Garment Merchants Association, told the New Financial Watcher: “At present, many second-generation local apparel companies in Tianjin have participated in the day-to-day operation of the company. Most of them are engaged in professional-related or Internet-related business. Successions may only be a matter of time. The problem."

Difficult choice

Most of the local apparel companies in China were established and gradually developed in the 1980s and 1990s, such as the Meibang, Semir, Lilang and Septwolves.

According to Yang Dayi, president of Ultima International Brand Investment Group, the material in that era was relatively scarce, and demand was greater than supply. “Many clothing companies rely on their manufacturing and replication capabilities to create today’s market size and influence.” Financial Watcher said.

Nowadays, the fashion market has developed rapidly and has undergone great changes compared with the past.

“The most important thing is that the consumer groups are changing. After the original 70/80 consumer groups are gradually getting old, and after 90/00, they are becoming new consumer groups. The update iteration of this consumer group has also produced huge demands for apparel companies. The change requires these companies to seek upgrades and changes," said Yang Dazhao.

Zhao Huakang has a deep understanding of this point.

"To tell the truth, including my dad, there are some old employees working hard with him. Their way of thinking is really old and it is difficult to adapt to the current young consumer groups."

He further exemplifies: "For example, nowadays, the Internet age is all in IP. It used to be that the spokesperson used to advertise and promote products. It is passive. Now it is the interaction between the brand and the consumer, from the consumer economy to the fan economy."

Zhao Huakang insists that it takes time for the older generation to make this change. "They are hard to adapt." Especially for apparel companies closely related to fashion, leaders are more sensitive to the perceptions of the market and consumer groups.

Therefore, he feels that the current clothing companies need the help of the second generation. "Aside from the succession of the shift, at least the second generation of thinking can bring fresh blood to the company and help the development of the company," he said frankly.

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Mr. Shen, a former professional manager of a large-scale clothing company in China, said to the new Financial Observer reporter: “For the generation of Chinese garment companies, the best destination may be the second generation of the family.”

He has been a professional manager for nearly 3 years and he has a deep understanding of this. He believes that many generations of family-owned companies do not have that vision and mentality to ask professional managers. "The competent companies will invite internationally-renowned strategic consulting companies to guide their work and give advice, but they can willingly pay a big price for a career. There are still very few managers, and some companies even prefer to be acquired by other companies, retreat from their own money, and are not willing to hand over the company to so-called outsiders."

However, he also does not deny that the integrity and courage of some professional managers are not enough, and managers themselves have such problems.

In contrast, the second generation of a company may not be as good as a professional manager in some respects. "But at least one hundred percent of the trust can be obtained and there is no ability to say it. From the parents' perspective, the second generation has this qualification to take over the business." He said frankly.

Pros and cons

“It is easier to accept new things, understand new market demands, and be able to use the Internet to manage the company with new thinking.” This is what Yang Dazhao sees as the biggest advantage of the second generation. In contrast, a new generation is more vulnerable to its own experience and past working methods.

Take Haicang House as an example. At that time, a generation of Zhou Jianping invited Wu Dawei, Yin Xiaotian and others to frequently bombard television media, enough to allow this brand with a relatively high price/performance ratio to take root in third and fourth-tier cities.

Now faced with new consumer groups, coupled with the prevailing background of the Internet, Haicang House has also adjusted its brand positioning, and its products are actively moving closer to “rejuvenation and fashion”.

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In the marketing strategy of the second generation Zhou Lijun, those splendid spokespersons are not the protagonists. The title sponsorship of various online variety shows is the key. In April last year, Haicang’s home also tried the IP market and jointly launched “Madagascar” series of derivative products with Oriental DreamWorks. "These strategies must have been influenced by Zhou Lijun's thinking." The aforementioned industry sources said.

But the coin has two sides.

After all, the younger generations are young. Although they generally receive a good education, and some have gone abroad to accept the baptism of a globalized market and look far ahead of their generation, the second generation with overseas background may not be able to adapt to the Chinese business environment. Especially family businesses.

At this point, Zong Junli and Zong Qinghou are very different when managing the company. The former is hard to accept the concept of their parents' family culture. What's more, these second generations "have not had an entrepreneurial experience, and many times lack the ability to make independent judgments. Many things are not easy to implement." The aforementioned industry sources pointed out.

In this regard, Yang Dazhao has a different view. He believes that the acquisition of knowledge and the experience of experience will be easier nowadays, and the companies that the generation of people had built up over the past decades have already matured in terms of culture, management system, and information system. He made a metaphor: "The experience of creating a generation is to build a car, drive a car, and the second generation is a driver. Just learn good driving skills and control an already made car."

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However, skills such as management experience and personal life are not learned in the MBA classes and need to be practiced in business management. In reality, even if the second generation succeeds, it is rare for fathers to be completely laissez-faire and not at all concerned. For example, Zhou Jianping currently serves as chairman of Haishu Group.

“Even if there is no position, it is affirmative as the fathers’ mention of the younger generation. After all, this is a company that is working hard on its own,” said Mr. Shen.

In announcing Zhou Lijun’s appointment, Zhou Jianping wrote his son’s “Building Achievements” gifts. He believes that all generations of generations have the same expectations as Zhou Jianping for the second generation. For the second generation of apparel companies, the future is not easy.

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