Exploring the Hanfu Base Camp in Cao County: It’s not easy to get popular, "be sure to make a net profit of 20%"
Hanfu, JK clothing (Japanese-style school uniform for female high school students), and Lolita clothing are also called the "Three Sisters of Bankruptcy."
If you customize a high-end Hanfu, you may need tens of thousands of yuan, which is a heavy burden for consumer groups between the ages of 18 and 30.
Shandong Cao County (belonging to Heze City) is aiming at affordable Hanfu, with product prices between 100 and 500 yuan, quickly occupying the market.
Public information shows that the Hanfu products sold by local e-commerce companies in Cao County have accounted for one-third of the national Hanfu sales.
"The latest data may exceed 35%. Cao County's performance clothing sales accounted for about 70% of the national share, but under the epidemic last year, performance clothing was unsalable, and many merchants switched to Hanfu." A head performance clothing factory in Daji Town, Cao County The person in charge told a reporter from China Business News.
Li Fugui, the person in charge of a Hanfu e-commerce company in Daji Town, told China Business News that Hanfu is becoming more and more popular today. As long as you can penetrate the market and understand customer needs, you can basically make a steady profit without losing money. "The net profit of each style can be 20%. the above".
The iiMedia Consulting report shows that in 2020, Chinese Hanfu enthusiasts will maintain a high growth rate of more than 70% for four consecutive years. The Hanfu industry's market sales in 2019 exceeded 4.5 billion yuan, a year-on-year increase of 318.5%.
The booming market has attracted many merchants, but the Hanfu industry in Cao County is still in the stage of making a fuss, and it is hard to speak of brand power.
A reporter from China Business News found during a visit to Cao County that many Hanfu e-commerce companies had financing gaps. Due to lack of collateral, it was difficult to obtain loans of more than 500,000 yuan from banks.
“The industry lacks integration. There are many Hanfu e-commerce companies in the home workshop style, and the financial information is not complete. The local banks have not done large-scale industry credit granting. We only provide sporadic credit services for a small number of e-commerce companies." The person in charge of the branch told China Business News.
Explosive money is difficult to concoct, how to make steady profits without losing?
In 2013, Li Fugui was 24 years old. After graduating from university for a year, he had a bad time in the big city. Hearing that many people in his hometown made some money in the costume business, he decided to go back to business.
As early as 2008, there were people in Cao County who were engaged in the clothing business, mainly wedding dresses and photo clothing, which were supplied to photo studios in the south.
Around 2010, e-commerce began to rise, and several townships in Cao County began mass production of costumes, and later focused on the Hanfu market.
Li Fugui said that he had been in the costume business for more than 6 years and switched to Hanfu last year.
There are many reasons.
Under the impact of the new crown epidemic, the performance industry has been greatly impacted, and the survival and development of performance clothing is facing unprecedented severe challenges.
"In the first half of last year, the number of middle-aged and elderly performance costumes sold by many merchants dropped by about 80% year-on-year, and even more merchants did not even sell a single children's costume." He said.
In addition to the epidemic, another reason for Li Fugui's transformation is that the seasonal sales of costumes are very strong, the spring and autumn shipments are large, and it is difficult to prepare novel styles and enough goods in the short term.
He is also under pressure, and a lot of hair fall during the peak sales season every year.
Hanfu is just a general term, covering thousands of years of style evolution. The details of clothing and the craftsmanship of accessories are also very particular.
And what consumers are looking for is probably just a certain type of hot product.
Li Fugui said that last year he launched a relatively popular Hanfu in the store, which sold more than 100,000 pieces at once. At that time, he was "very happy" and felt that all the hard work was worth the effort.
It is the dream of every business to produce explosive Hanfu, and a lot of hard work is required behind it.
"However, it is difficult to predict the explosion of styles." Li Fugui said, for example, last year the popular Hanfu made in Song Dynasty, focusing on simplicity, rationality, elegance and generosity.
Horse-face skirts were the most popular in the first quarter of this year (there are four skirt doors inside and outside, the outer skirt doors are decorated, and the inner skirt doors are decorated with little or no decoration, which is the most classic style for women in the Ming and Qing Dynasties).
Stores can never predict what the next model will be popular. Only by staying close to market changes and having an in-depth understanding of customer needs can they only make money without losing money.
"We have built a number of fan groups, and opened Weibo, Douyin, Kuaishou, Xiaohongshu and other online platforms. We usually attach great importance to interaction with Hanfu fans and find out their needs through topic settings. When fans made suggestions, we listened to their feedback patiently and handed them to the designer. After we got the first draft of the Hanfu design, we would discuss it with the fans again and again.” Li Fugui said that Hanfu cannot be built behind closed doors and must not be separated from the market.
Cao County is a small place, and everyone has no strength to engage in offline activities, but on important festivals, many e-commerce companies will send postcards to each fan with blessings.
Li Fugui also said that, generally speaking, each Hanfu e-commerce company will support several workers on its own.
After proofing the Hanfu, let your own workers process 80-100 pieces.
If the sales volume is relatively large, then contact a larger local or foreign processing plant to increase production.
"The Hanfu circle says it's not big, but it's not small. Customer's word of mouth is the most important."
He said that to "treat every customer as a friend," this sounds imaginary, but over time, the market will reward it.
Credit needs have not been met
In recent years, regulatory requirements have required large state-controlled commercial banks to give full play to the "head goose" effect, achieve a significant year-on-year growth in the balance of loans to inclusive small and micro enterprises, and control the comprehensive financing cost of credit at a reasonable level.
At present, in many areas, state-owned banks are beginning to sink, and collectively grant credit to industrial clusters, and the local characteristic economy has become a "sweet and pastry" for banks to compete for.
Although the low-end Hanfu in Cao County has been selling well, the reporter of China Business News found that, up to now, various financial institutions have not entered the Hanfu business in Cao County on a large scale.
"The houses of Hanfu e-commerce companies are basically self-built, and it is difficult to mortgage the land and factories. Banks generally provide credit loans between 300,000 and 500,000 yuan. For smaller e-commerce companies, banks are afraid to borrow; However, large enterprises have a large demand for funds, and 500,000 yuan is not enough." said a local branch head of a large state-owned bank.
Li Fugui said that last year he borrowed a 300,000 yuan credit loan from a local bank through the green channel of "expatriates returning home to start a business" with an annualized interest rate of 5%.
But his business expansion needs more funds.
"Because the company started to make JK uniforms this year, the company has some shortages of liquidity funds. In addition, it plans to start cross-border e-commerce, but if the goods are exported to foreign countries, the billing period is usually about 50 days, which requires higher funds. We are more than minded but not strong enough." Li Fugui said, "And banks are generally cautious and dare not lend too much money. We are small in scale and cannot give banks practical protection."
In addition to the small scale of production and insufficient collateral, the person in charge of the above-mentioned bank said that another reason why local financial institutions are not optimistic about the Hanfu industry is that there is a strong copycat style.
Although Caoxian Hanfu has a large share in the domestic market, most of them are on the low-end route, and the originality ability is insufficient.
For example, in 2019, a well-known Hanfu brand was plagiarized, and the boss directly brought a team of lawyers to Cao County to bring the plagiarism Hanfu merchants in Cao County to court.
Many local Hanfu merchants paid a lot of "tuition fees."
"After 2019, Cao County Hanfu's attitude towards originality has changed greatly. Our original designs are mainly from professional design companies and art majors undergraduates. The design companies are very professional, but the asking price is higher. Although the students at school lack painting experience , But can better understand the current young people's thoughts, and it is easier to design products that are close to the market." Li Fugui told the CBN reporter.
"In the next few years, the company's plan is to expand the flow of domestic (market) first and then foreign (market), get the recognition of banks, and obtain greater credit support. We have done OEM for foreign countries before, mainly "Ha The clothing derivatives of "Lee Potter" and the anime "Demon Slayer" sell well, but the net profit of each piece is only a few yuan. I hope that in the future, we can cooperate with foreign cultural industries and IP to expand the clothing business. Go overseas and get more profits." Li Fugui said.
(At the request of the interviewee, Li Fugui is a pseudonym)
Author: Chen Hongjie