Domestic apparel manufacturers unanimously denied price increases

Beijing Business Daily (Reporter Li Wei) was pressured by rising costs, and the purchase price of certain goods in the Beijing market has increased, so that the rumors that domestic clothing brands will raise their prices collectively this year will intensify. However, yesterday, local apparel brands such as Bosideng Dr. Frog and SUSIE participated in the China International Clothing & Accessories Expo have expressed that due to large sales volume and stable relationship with suppliers, the recent price adjustment is unlikely.

Yesterday, a large number of local apparel traders who participated in the China International Clothing & Accessories Expo in Beijing stated that they would not adjust their prices for the time being due to increased production costs.

According to the person in charge of Bosideng, the largest manufacturer of down apparel in China, due to the large number of retail outlets and large sales volume, the prices of raw materials supplied by suppliers to enterprises are relatively reasonable. At the same time, due to high output and relatively low fixed costs such as production lines, commodity prices will not be raised in the near future.

The person in charge of Dr. Frog, the largest children's wear brand in China, also stated that in the previous procurement, the company had already prepared for possible rising raw materials in the future. At present, the company's textile stocks are abundant, and commodity prices will remain stable.

SUSIE, which operates nine stores in malls such as Beijing Xizhimen Jiamao Shopping Center and Dongzhimen Ginza Mall, said that the brand is positioned as a fast-fashion store with a large annual sales volume and will not pass on the pressure of rising costs to consumers.

In the face of rising production costs equivalent to that of foreign-funded enterprises, large-scale domestic apparel manufacturers collectively chose to “stabilize”. In this regard, the industry analysis, in the domestic apparel sector, most of the market share has been divided by foreign brands. Especially in first-tier cities such as Beijing, because the styles are more fashionable and more famous, the consumer groups in these regions are more willing to purchase foreign famous brands. Once domestic apparel brands follow the “price increase” of foreign brands, it is not only difficult to ease the cost pressure, but it is also likely to lose their original position.

One person who does not want to be named believes that the domestic garment industry has a high profit. Even if the production increases, brand owners can accept the compressed retail profits. Moreover, the variety of clothing styles, such as subtle changes in the collar can lead to price fluctuations. Adjusting prices with style changes is more easily accepted by consumers than simply increasing prices.

Despite this, labor shortages and oil prices continued to rise, and rising commodity prices caused by rising production costs have begun to show up at some retail terminals in the capital. According to the merchants of the mainstream market in Beijing, such as Yaxiu and Xiushui, this year, the purchase price of clothing and other goods has increased, leading retailers to raise prices by about 20%. According to consumers, this year's purchase of a dozen yuan T-Shirts in the clothing market is 10 yuan more than last year.

In the same channel chain, upstream manufacturers denied price increases, while retail terminals showed price fluctuations. According to industry sources, this indicates that the manufacturer's production process is not a decisive factor in the pricing of commodities, and that the real controlling power of pricing is actually an intermediary agent.

Business experts said that since the affiliate deduction model has always been the mainstream of domestic commerce, agents have built a bridge between manufacturers and retail channels. After the manufacturer completes the production, it sells the goods to the agents to recover the pre-investment, and also transfers the operating risks to the agents. Due to the need to bear the pressure of inventory, as well as the deduction points and miscellaneous fees for entering the mall, many agents will increase the purchase price by nearly twice and enter the retail terminal.

It is reported that under normal circumstances, each consumer purchases a commodity, the agent and the brand dealer can obtain 45% and 35% of profit respectively, and the remaining 20% ​​is obtained by the retail terminal.