In-depth investigation
The transformation of traditional wholesale markets
Editor's note
Affected by e-commerce, the days of the traditional wholesale market are not as good as each year. Coupled with the impact of the epidemic, many shopkeepers worked with the market to seek a breakthrough. This is not only a hurdle that many young entrepreneurs must collectively overcome, but also a political proposition for local governments to implement the "six stability" and "six guarantees." There are 33 professional wholesale markets in Yaohai District, Hefei City, Anhui Province. Can they turn crises into opportunities and force changes within the industry and embark on a road of transformation? China Youth Daily and China Youth Daily reporters conducted in-depth investigations and interviews using this sample.
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When Si Guangkun, a post-90s Didi driver, learned that the reporter was travelling to the clothing wholesale market for interviews, he shyly revealed another layer of his identity: "I'm actually a small clothes seller. I drive Didi when I have time. Drop'self-help'."
Si Guangkun initially ran a store in Hangzhou. He returned to Hefei in 2016. He initially rented a shop in Anhui Baima Clothing City to engage in clothing wholesale. After contacting e-commerce, he returned to retail, combining online and offline. Currently, he has opened two stores in a commercial complex, but since the outbreak, the store business has been very cold. Running around looking for supplies during the day and being an online car-hailing driver at night is his normal life now.
The White Horse Clothing City mentioned by Si Guangkun is the largest clothing wholesale market in Anhui Province. In Yaohai District, Hefei City, 33 similar professional markets have been formed around Hefei Railway Station. They are basically "buy the whole country and sell the whole province." , Operating textiles and apparel, department stores, food and daily groceries, home building materials, etc., in 2019, the total transaction volume reached more than 60 billion yuan.
As a retailer, Si Guangkun's current dilemma undoubtedly reflects the reality of the upstream professional market.
Affected by the impact of e-commerce and the epidemic, traditional professional markets are facing double challenges. Can they turn crises into opportunities, forcing changes within the industry and embarking on a path of transformation? This is not only a hurdle that many young entrepreneurs must collectively overcome, but also a political proposition for local governments to implement the "six stability" and "six guarantees."
Recently, reporters from China Youth Daily and China Youth Daily conducted an in-depth investigation.
Once "buy the whole country and sell the whole province", now the distribution function is diminishing
Since the reform and opening up, Zhejiang, Guangdong and other places have taken the lead in the emergence of many trade fairs run by small traders, and later evolved into a professional market dominated by wholesale and retail. A few professional markets located in first-tier cities have grown into regional, national and even international commercial distribution centers with distinctive features and considerable advantages.
However, due to conditions such as location and number of customer groups, most professional markets located in provincial capital cities have limited radiation capabilities and often assume the function of a “secondary market”, with wholesalers acting as the “provincial representative” (the provincial general manager). Agent).
Wu Renyou, a Wenzhou born post-70s entrepreneur, was once in charge of the operation of a well-known sports brand in Fujian. In that era of conflicting brand marketing, he witnessed the magnificent achievements of the professional market and the "provincial generation" to open up the national market. Back then, an inconspicuous space could be the "investment window" of the province, behind which was a business legend. "At that time, brand owners did not have a national distribution system and could only rely on these'windows' to go to the whole country."
However, after the outbreak of the new crown pneumonia, Wu Renyou discovered that many merchants in the professional market downstairs of the Hefei company began to withdraw. "The life of the traditional wholesale market is not easy. The year is not as good as the year. The market service ability and experience ability are getting weaker and weaker. The empty rent rate is very high. If it is not transformed, it will become an'empty city'." He sighed.
In fact, people in the industry are soberly aware that in the Internet age, the information of buyers and sellers is gradually symmetrical, and the trend of disintermediation is increasing. Retailers and consumers can skip physical stores and wholesalers and directly obtain goods from manufacturers through online channels. The wholesale link is no longer important.
Since 2019, Si Guangkun has been trying to "cross" the wholesale market, specifically going to Hangzhou, Guangzhou, and Shenzhen to find manufacturers. Basically, he makes a trip every month. He is greedy for the dark and often has swollen feet. However, he manages more than 70 clothing brands, one piece can save 15%-20% of the cost. "In the past, when replenishment was needed, the wholesaler did not have enough storage and had to find the manufacturer to deliver the goods, and then transfer it to me, which often delayed business opportunities." He added.
How to transfer? Each has its own tricks
The traditional professional market has obviously reached the moment when it has to be transformed. How to transfer? Each company has come up with its own problem-solving ideas.
The post-80s Sun Xianhong is the head of Hefei Sijiqing Garment Wholesale Market Commercial Management Company. He has been engaged in management work in the adjacent professional market for more than 10 years before and deeply understands the pain of transformation. After he joined the company, he led the business management team to formulate the most thorough reform "prescription".
This clothing store presents a "mix and match" layout. The second floor is still the world of clothing stores. On the third floor, 6 stores specializing in hotel supplies have settled, and several are under renovation.
"Thinking about changes began in the second half of last year. In the future, businessmen of hotel ceramics, stainless steel products, kitchen equipment, coffee machines, and linens will come in to create a full-format boutique hotel supplies wholesale and retail distribution center." Sun Xianhong said frankly, although the transformation consumes energy, Financial resources and risks, but if you don’t take this step, you may not be able to survive.
"The reason why I chose to switch to hotel supplies is that this industry is less affected by e-commerce and has market prospects." According to him, when customers buy hotel supplies, hundreds or thousands of items are often involved, and they must go to physical stores. Weighing and material selection. In addition, there is no large-scale distribution center for hotel supplies in Hefei. Hotels and restaurants in Anhui Province can come to purchase, and city and county wholesalers can also come to purchase.
"Clothing wholesale and retail stores are mainly mom-and-pop shops, with low technology content and low thresholds, and most of them wait for customers to come to the door." He analyzed that by comparison, the investment threshold of hotel supplies is higher, which tests the financial strength and management level of operators. It is necessary for the operation and management personnel to go out, bring in customers and improve the quality.
At present, the business format of the 1-4 floors of Sijiqing Garment City is undergoing transformation, from the original clothing wholesale and retail to the hotel supplies wholesale and retail. The transformed construction area is about 15,000 square meters, and the total project investment is about 50 million yuan.
"On the transformation of the professional market, positioning and direction are very important, and investment is also very important. Finding customer resources and distribution channels is the kingly way." Sun Xianhong said.
In Wu Renyou’s view, existing agents can also "transform" into retailers, and then become a distribution link in the retail system, and at the same time become a "node" on the Internet marketing path. The shorter the coming, the more competitive the price of the goods.
"At present, the brand side and the retail side are changing, and the era of large wholesale has become the era of large retail." He founded Dianmao Network Technology Company to help traditional wholesalers turn to online "new retail" and provide one-stop service technology stand by. "In this way, wholesalers in professional markets do not need to open physical stores, but can also conduct distribution and retail through the Internet."
The most thorough transformation: restructuring the industrial chain
"The era of'earning the price difference' in the wholesale market is over." Wang Denghou, who is over 60 years old, is the creator of the White Horse Clothing City and the "veteran" of the Anhui clothing industry. In his view, the most thorough and fundamental transformation of the professional market is to restructure the entire industrial chain of clothing design, production and sales, and truly realize that the self-owned brands produced in Anhui will be sold nationwide.
Under the impetus of Wang Denghou, nearly 80 agents in the clothing city have been successfully transformed. The self-operated clothing brands such as Impression Tree and Anna have entered the national market, but this is far from what he expected.
"Anhui is a major textile province and a major clothing processing province, but independent brands do not have core competitiveness. The production plants are mainly OEMs. For example, most of the clothing brands in Hangzhou are produced in Anhui. We transport Go out, and come back in again." This is a pity that has been weighed on Wang Deng's heart for a long time.
"Is it possible to produce original clothing in Anhui? I don't know how it was before." Starting in April this year, Wang Denghou took his colleagues and designers to visit and investigate, and traveled to more than a dozen industrial parks in the province. He found that spinning factories, bleaching and dyeing factories, weaving factories and other supporting factories are all available, and they have the basic conditions for developing the garment industry.
The research in coastal areas made him feel even more excited: “There are nearly a thousand Anhui business households engaged in the business of noodles and accessories across the country, and well-known Anhui fashion designers are active in major design institutions.” From this, the conclusion can be passed. External and original design to drive the transformation of Anhui garment processing plants from OEM (OEM) to ODM (Original Design Manufacturing), thereby promoting the upgrading and transformation of Anhui clothing wholesale market.
However, industrial transformation cannot be separated from the support of talents, especially young talents at the top of the industry. For this reason, Wang Denghou began to frequently meet up with young designers and mobilize them to "return" to their hometown.
Ding Cencen, a native of Xuancheng, has been working in Anhui Baima Original Design Brand Base for nearly two months. After graduating in 2015, she has stayed in Hangzhou, engaged in original brand design and wholesale style design. She lives in Yuhang District, where clothing companies and factories gather, and work is very convenient.
This year, Ding Cencen met Wang Denghou when she returned to visit relatives in the hometown. After the two exchanged, she refreshed her knowledge of Anhui's clothing industry and decided to come back and give it a try. In the past month or so, she has traveled to several cities in northern Anhui to help the factories there in fabric layout and style design. "I hope to develop together with more Anhui designers and contribute to the transformation of Anhui's clothing industry. ".
The 29-year-old Fuyang designer Yang Yang is also from Hangzhou. These days, she is busy handing over the designed samples to Wang Denghou, who will contact the industry chain to confirm whether the version meets the standard and whether it can enter the market.
"Many Anhui designers have hometown feelings. When they see the potential of their hometown, more'family members' will come back." She also plans to continue to open her live broadcast studio after returning home. Many hometown colleagues spread design concepts and methods.
"If we can promote the return of more young designers, it will bring orders to return, help solve the dilemma that industrial workers have no work to do, factories are stopped, and design works lack souls, and it will help to form an organization that buys the whole province and sells the whole country. Pattern." Wang Deng said confidently.
"Creating the second generation" succeeded, subverting traditional management thinking
"The key to industrial transformation is the change in the concept of the operating subject. If you stick to the old thinking, you can't turn it around." Guan Fangwei, 33, is regarded as an "old man" in Baima Clothing City. He has witnessed the old-fashioned "mom and wife shops" around him. "The exits one after another.
In many traditional professional markets, the first batch of operators are owners of the original shops. They have a low level of education. They rely on good markets and wait for customers to come. Now they lack confidence in embracing the Internet. Over the years, many "landlords" have sublet their shops to young people with more business thinking, virtually "shifting gears" for the transformation of the professional market.
After graduating in 2016, Guan Fangwei moved to Baima Clothing City and rented a 40-square-meter shop on the third floor to operate creative stationery. Now his image display shop has an area of 2,000 square meters. In recent years, the business has become better and better, and the categories have become more and more complete. It has represented 50 cultural, creative and stationery products and radiated 11 direct-operated stores.
"Customers come to buy stationery, not just for cheap, many are impromptu consumption, because the environment stimulates the impulse to buy, they buy when they like it." Guan Fangwei not only has a unique vision in product selection and assembly, but also pays special attention to the shopping environment. Build. What he can't understand most is, "Why are there a mess in a wholesale store? A wholesale store can be as beautiful as a mall store, and it must actively transform to meet the needs of customers."
In his view, in the Internet era, the information of goods is "transparent", and what matters is the shopping environment, customer experience and after-sales service. These conditions are precisely what e-commerce cannot provide. Therefore, some categories in the professional market will not suffer too much. "These small items can only be prepared by us. Besides, if you urgently need a pencil, will it take two days to wait for the e-commerce to ship it?"
Unlike Guan Fangwei, Zhu Lei born in the 1990s was a "second generation" who entered the professional market and was "forced" to take over his father's class. The father and son worked hard for 17 years and accumulated stable customers and channels. At the moment, they operate two image stores in China Green Plaza, represent 15 underwear brands, and supply 1,700 stores.
Zhu Lei majored in biology at University. After preparing to take over his father’s business, he did not rush to stand at his counter immediately. Instead, he immediately applied for a clothing company in Nanjing to learn warehouse management, and then went to Changsha to learn online stores. Operations.
"When I went out to study, I discovered that well-known clothing chain stores pay special attention to the design of lighting atmosphere, and the display of underwear also needs light to set off." Zhu Lei, who was born in engineering, learned the knowledge of aesthetics design by himself, and transformed the lighting of the store by himself. And regularly urge distribution stores to update display racks and containers.
He is well aware of the importance of technology, so he introduced a sales management system to dynamically manage distribution and inventory through a database, and even designed his own program to analyze the "sales trajectory" through a data model.
"What goods and sizes sell well, we must be aware of it, adjust the purchase ratio in time, and feed this information back to our orderers." In Zhu Lei's view, "we should treat them as our own franchise The store provides guidance, everyone is a community of interests and must achieve a win-win situation."
"The moment the customer pays is not the end of the transaction, but the beginning of the transaction. It is very important to maintain the customer's stickiness." Zhu Lei continued to transmit such views to his father. He arranged for commissioners to conduct after-sales return visits to customers, collect feedback, adjust business directions in time, and improve service quality.
"These seemingly redundant jobs also invisibly increase operating costs. My father asked, how come the business is big, but there is less money?" Zhu Lei explained to him: "Making money is to invest in services and become friends with customers. Long-term business."
"No merchant can complete the transformation alone"
Born in the 1980s, Bao Fenghua has long been an agent of business men's clothing and fashion men's clothing. He has opened dozens of specialty stores and tried various business models. Since 2016, he has another mission on his shoulders-the chairman of Anhui Baima Garment City Chamber of Commerce, leading more than 600 member companies on the road of transformation.
In addition to building a learning exchange platform for members, Bao Fenghua seized every opportunity to reflect the current business pain points of professional market operators. "Most of the fixed assets are commercial shops. Who would buy so many houses? But the current reality is that bank loans only recognize residential mortgages. I hope that relevant departments can introduce financial support policies for small and micro enterprises." In addition, he has also repeatedly asked The management department of the commercial complex urged that during the epidemic period, we should not only pursue the rate of return on investment. Only by reducing rents can we avoid high vacancy rates and allow the entire industry to have business.
"No single merchant can complete the transformation alone. Transformation is a matter of the industry and the government." He said with emotion, "The government is the banner and weather vane. The government needs to take the lead, integrate professional market resources, and rely on the current Anhui fashion district to lead. The overall transformation of all parties will promote the stable development of the market."
It is understood that starting from 2018, Yaohai District of Hefei City has planned to build an "Anhui Fashion District" around the most concentrated clothing professional market, and build a "balanced development in the eastern and western districts, a system of wholesale and retail, and the integration of market and urban life. A three-dimensional business ecosystem that meets new consumption and new demands. In 2019, the district was awarded the honorary title of "China's Famous Clothing Trade City".
A few days ago, the brand incubation project led by the government and promoted by enterprises-Anhui (White Horse) Original Design Brand Base is also in the countdown stage for opening.
The project consists of an exhibition hall for surface materials, an exhibition area for original brands, and a live broadcast base, and introduces design studios and original design brands, docking production plants, and aims to incubate Anhui independent brands and explore new retail models. At the same time, the Baima clothing wholesale market will be transformed from the outsourced type to the original type, which will promote the upgrading and transformation of the clothing industry in the province.
"There are 33 professional markets in the whole district, with more than 20,000 business households, involving the livelihoods of thousands of households. This is the focus and key point for the implementation of the'six guarantees' and the implementation of the'six guarantees'." Party Secretary Huang Weidong analyzed that from a historical perspective, for the old industrial zone, the professional market is not only the development potential, but also the difficulty of transformation. It cannot be bypassed from the perspective of urban development or people's livelihood and employment.
"The transformation of the professional market is a systematic project. It must be empowered through new technology and business innovation, and it must also focus on increasing, supplementing, and strengthening the chain, so that the industrial chain will become wider and longer." He emphasized.
China Youth Daily and China Youth Daily reporter Wang Lei and Wang Haihan Source: China Youth Daily