Shanshan Group: Fruitful Achievements in the Strategy of "Multi-Brand, Internationalization"

Company Name Shanshan Group

Zheng Yonggang

Main business clothing

Established 1989

★ outstanding performance:

Starting in September 2001, the "multi-brand, internationalization" strategy has been in
The brand's layout, Shanshan's transformation has been recognized by the market. In 2005, Shanshan clothing sales increased by 25.8%, profits increased by 59%, and part of global procurement and global orders were achieved. Regardless of scale or profit considerations, Shanshan has implemented a multi-brand strategy for many years and has achieved a leap from high yields to bumper harvests and began to enjoy the joy of harvest.

★Core Logic:

Clothing embodies the precipitation of culture and history and cannot be obtained through compression. Therefore, it is difficult for China to create international top brands in a short period of time. Shanshan began to implement the "multi-brand, internationalization" strategy. Through controlling (instead of agency, surpassing the routine practices of many other Chinese companies) 9 international apparel brand joint ventures in China, the brand advantages and advanced management and design concepts of foreign top brands, and the low cost and high cost of Chinese companies Combining quality with a large sales channel to achieve "Bohai to the sea"--build a brand pyramid with its own international top brands. At the same time, Shanshan also reserves 13 own brands, and the brand pyramid has begun to take shape.

★ Mode path:

Case study

In recent years, Shanshan Group has maintained a quiet low-key. This low profile continued until the 2006 China International Clothing & Accessories Fair held in Beijing.

At this expo, 22 brands of Shanshan have exclusively occupied Hall 9 of the Beijing International Exhibition Center. The entire exhibition hall, Shanshan independent brand apparel booths and joint venture brand apparel booths are located. From formal wear to outdoor leisure wear to golf special clothing, from sports and leisure oriented to mass consumption to international top brand clothing, Shanshan's brands cover most of the subdivided apparel markets.

At the same time, Zheng Yonggang, chairman of Shanshan Group, stated in a high-profile that “clothing will always be our main business, and we will upgrade it to a fashion brand industry. I believe that after 8 to 10 years, domestic apparel brands will go out of the country in batches. I hope The second trend that can lead the reform of the domestic garment industry."

After years of silence, Shanshan once again played a high profile. All this stems from its "multi-brand, internationalization" strategy that has begun to bear fruit: In 2005, the total sales of 9 international brands owned by Shanshan have exceeded the peaks of Shanshan and they have all achieved profit; Shanshan's The clothing sales of 13 independent brands have increased by 25.8%, profits have increased by 59%, and some have achieved global procurement and global orders.

Apprentice International Brand

"Building Shanshan as a truly international brand is my life's dream!" As the overlord of China's fashion industry for many years, Zheng Yonggang is obviously reluctant to meet the achievements in the Chinese market.

However, with the end of the shortage economy era and the large number of international brands entering the market, the Chinese market has undergone fundamental changes. Around 1999, domestic brands such as Shanshan, Youngor and Luomeng were successively invited out of high-end shopping malls in big cities. These national brand names have not been washed out of the country, they have been killed in the local market by international brands.

No longer alone, Zheng Yonggang thinks this is the inevitable result of the development of the times. "Fir is a special brand for the world. It's a special case of a shortage economy." He believes that the real brand is like a pyramid. The top Italian luxury brand, there are only 5 stores worldwide, "and our county town is laid The outlets are indeed popular brands. I say that this is not a brand name. At best, it is just a folk card."

The huge gap between ideals and reality stimulates Zheng Yonggang and his Shanshan. Zheng Yonggang visited Paris more than a dozen times. He felt the cultural connotations of those famous international clothing brands that have accumulated for decades or even hundreds of years. In the end, he had to accept a cruel reality: For a long period of time, China could not produce a truly international brand name.

The unprepared loss in the end of the shortage economy era led Zheng Yonggang to understand that the fight for the garment industry in the future will inevitably be a competition among international big brands. As a leader in China's clothing brand for many years, how can Shanshan get the admission ticket for the future duel?

"I have the self-knowledge that China is not yet able to create internationally-renowned brands in the short term. We mainly study with international brands and use them to expand the international market." This kind of cutting-edge "self-awareness" has implied that Zheng Yonggang is passive. Among the many ambitions. Thus, Shanshan chose "sleeping with the enemy" and "multi-brand, internationalization" strategy emerged.

In September 2001, Shanshan Group's "multi-brand, internationalization" strategy was officially launched. In the same month, Ningbo Jie Ai Xi Garment Co., Ltd. was established. This is a joint venture established by Shanshan Group, jointly with Italy's Faro Group and Japan's ITOCHU Corporation. It operates the Italian brand Malang Essani in the Chinese market.

Shanshan part of the joint venture company holdings list

Name of joint venture company operating brand Shanshan Holdings

Jerzy Marco Azzali 65%

Lecq Sportif (big cock) Shanshan Participation Shares 20%, Shanshan Rongguang Participation 30%

Ningbo Shaye Callaway (Callaway); Pinky&Dianne49%

Ningbo Renoma Renoma 61%

Ningbo Lubiam 60%

For this kind of cooperation, Zheng Yonggang repeatedly emphasized: "We are a joint venture, not an agency brand." In Zheng Yonggang's view, companies in France and Italy have brand advantages and design capabilities, while Shanshan is familiar with the domestic market and has low cost. Quality production advantages. "Our cooperation is a combination of these four core competencies and equal cooperation." Zheng Yonggang emphasized that "Firshan has always held a controlling position in joint ventures with these international brands."

With equal cooperation with international brands, Shanshan has the advantage that other domestic enterprises can not match: agree with the concept of international standards, Shanshan good quality reputation, high quality, low cost manufacturing advantages and the advantages of network channels woven in 3,000 stores . When many international brands want to enter the Chinese market, this advantage of Shanshan is transformed into the basis for cooperation between the two sides.

In fact, Shanshan is not the first to cooperate with the international famous clothing brand. But it can truly operate international brands. Shanshan is the first one. At present, Shanshan is operating nine international brands in joint ventures or partnerships with companies such as Itochu Corporation of Japan and De Santer Corporation. Among them, some of the joint venture brands that Shanshan is absolutely holding have a good profitability, and brand owners have repeatedly asked for additional shares.

At the end of 2005, Shanshan's nine international brands all made profits. Some fast-growing brands, such as Reynolds, entered Shanghai Oriental Plaza within two months, and its single-month sales reached 890,000 yuan, ranking fifth among 18 similar brands in the mall.

For the cooperation with international brands, Zheng Yonggang is very optimistic: “In these years, Shanshan was not doing OEM for international apparel companies, but through the introduction of international brand operations, absorbing international brand culture, in the process of cooperation with international brands. Train your business talents and design talents."

Shanshan's business model is not the first one. It just transplants mature models of international apparel companies. From industrial manufacturing to brand operation, Shanshan is catching up with the development track of the international apparel industry. The cooperation with international brands is a process of learning. It focuses on driving independent brands through international cooperation and making Shanshan a truly international brand.

Reserve own brand

In the Shanshan brand's layout, cooperation with international brands is only a catalyst for Shanshan to promote the growth of independent brands. The independent brands are the most important point of interest for Shanshan.

Shanshan's large and small independent brand companies mainly have two types: one is a company authorized by Shanshan brand, and the other is a company invested by Shanshan Group. At present, Shanshan already has 13 independent brands. With its own capital advantages and resource platform, Shanshan has become an incubator for independent apparel brands.

Shanshan part of its own brand holdings list

Original Brand Shanshan Holdings

Italian Tanino (outdoor sports and leisure) 70%

Machi Fort (Business casual Men's clothing) 50%

Philippine LE TUTU (Ladies) 90%

Bellerson Corporation (pregnant and baby clothing) 60%

Roses Micro Corporation (urban white-collar women's clothing) 51%

Shanshan Home Textiles 80%

For brands with potential for development, Shanshan often invests funds in holding, but generally only conducts independent audits and inspections of its finances, and does not participate in its management and personnel appointments and dismissals. This is done to give the original brand operator maximum space. However, Shanshan also has a "one-year deficit, two-year flat, and three-year profit" requirement for these brands. If it cannot win losses, Shanshan will no longer invest in additional investment. Therefore, though Shanshan's own brand companies have great freedom, the pressure is also everywhere.

At the same time, Shanshan also provided these independent brands with a platform for entering high-end shopping malls, as well as opportunities for learning and improving design and operational capabilities. Every year, Shanshan Group organizes the person in charge of the original brand to visit Japan, South Korea, France and other places to visit Shanshan's cooperative enterprises.

Shanghai Jijia Garments Co., Ltd. is a clothing industry company of Shanshan Holdings, which operates the imported brand Majibao. Through the smooth learning and communication channels provided by Shanshan, Jicai has started to position and operate the Majibao brand in accordance with the international brand model. The entire management team has completed its internationalization. Its product director is a Hong Kong designer with decades of experience, and executives are professionals who have been immersed in Taiwan for many years. At present, Jijia has been profitable for two consecutive years. Its sales store has already exceeded 60, with more than 10 monthly sales of 50-600,000, and the highest single-day sales record of 170,000 yuan.

Ma Jibao's growth has strengthened Zheng Yonggang's confidence to go in accordance with the established model. He revealed that in the next step, Shanshan may give Jijia an international brand, "when Makiki Fort wants to learn anything, he can learn it."

Learning from foreign brands is a long-term process. There are too many things to learn from brand design, brand control, brand release, and day-to-day management. According to the plan, Shanshan set this process to 3 to 5 years. After stability in learning ability, in 2007 or so, Shanshan will increase the operation of its own brand. Zheng Yonggang has a firm grasp of the future: "At that time, after years of nurturing and competing with self-owned brands, there has been a certain foundation. I will graft the talents cultivated by international brands into the past and increase investment. Success is a matter of course."

Ultimate dream

The success of one international brand and the rise of the original brand further highlighted the urgency of reviving the core brand of Shanshan. Zheng Yonggang also had "premeditated measures" for this.

At the China International Clothing & Accessories Fair, which was held in Beijing on March 28 this year, Shanshan Group launched a sports casual brand "Firty Modern." The brand operates in the manner of international brands, creating a style of leisure, sports, and street sports. The goal is to enter the center of large and medium-sized cities.

The key brand of Shanshan, which has always been mainly in formal dress, is the reason why this time the strong launch of the casual brand "Shushan modern" is aimed at injecting new vitality into the old brand of Shanshan, which represents the suit in people's minds. At the same time, Shanshan has introduced many international brands of leisure sports in these years and has accumulated considerable experience in this area.

Zheng Yonggang's ultimate dream is to build Shanshan into a truly international brand. He disclosed that after the introduction of "Firshan modern", the next step will be to introduce international first-line brands, learn to do the operation experience of international brands that are being installed, and then use them to raise the brand value of the core brand Shanshan Dress.

International brands need the accumulation of culture and history. There is no time for two or three decades to establish an international brand. "The Shanshan brand is already 16 years old and has gone through such Phoenix Nirvana. It is more successful than other young brands." Zheng Yonggang said.

[Analyst Reviews]

Huang Jiangwei, marketing planner, brand management expert, special researcher of the journal

For Shanshan, different people will have different evaluations from different angles and different times. Perhaps this is the status quo that an innovator needs to continuously face.

Shanshan's brand road has gone through a period of five years from the initial prototype to the small scale of today. When today, he once again high-profiled in public view with the status of 9 famous international joint venture brands and 13 independent brand owners. Time. One word we cannot ignore, this is "time". There is no way that the Shanshan has no way to find the road; there is no Shanshan persistent perseverance; there is no Shanshan to accept criticism, perhaps today's status still stays on yesterday's blueprint.

Success has some accidental factors, but it will go through some inevitable process. When Zheng Yonggang clearly realized the gap between Chinese brands and international brands, he learned and learned from the resources replacement and win-win cooperation. It not only reflects the pious and listening of the learners, but also maintains the independence and reservedness of a chaser. The international brand is successful, but he also needs the support of friends for the Chinese market. Zheng Yonggang has seized this demand and formed a trust, mutual trust, complementarity and mutual win with international famous brands within a very short period of time at a low cost. Partnership.

"Students barbarian skills to control the barbarians", Shanshan did not forget that the purpose of learning is to learn from, is to absorb, "the meat will be eaten into their muscles" in order to better play their own advantages. From puzzles to envy, from learning to application, from imitation to innovation, Shanshan has been paranoid in his own planning.

For more Chinese companies, they should learn from the Shanshan: a long-term sense of crisis in their own development; convert their advantages into resources for more resources, better opportunities; from the initial stages of imitation Advanced stage transition of independent innovation.