Why Do Local Fashion Enterprises Indulge In Overseas Treasure Hunt?

Or because of domestic clothing. brand With the increasing lack of attractiveness, many enterprises have focused their attention on international brands. These local companies are trying to climb up the value chain through international takeovers.

According to the world clothing and shoe net, Shandong Ruyi group plans to buy British classics from Hongkong YGM trade at a price of 120 million US dollars. Windbreaker Brand Aquascutum. At present, Ruyi group is conducting a due diligence investigation, hoping to reach a final agreement within the next few weeks. In 2012, YGM offered Aquascutum at a price of 15 million.

　 Transformation fashion group

Shandong Ruyi science and Technology Group Co., Ltd. (hereinafter referred to as Ruyi group) is the predecessor of Shandong Jining wool textile factory, founded in 1972, and is currently one of the largest textile manufacturers in China. From 2014 to 2015, Ruyi group ranked first in the top 500 of China's textile and garment industry.

The Ruyi group, which is focused on clothing front end, bought the French luxury clothing group SMCP 1 billion 300 million earlier this year. The latter has fashion brands Sandro, Maje and Claudie Pierlot. There are 1118 sales outlets worldwide, of which 906 are direct and 212 are cooperative. Its brand clothing It belongs to light luxury.

In less than half a year, the Aquascutum brand came out. Compared with the French fashion brands, Aquascutum has a longer history. The British tailor John Emary, who invented waterproof wool fabrics, was founded in 1852. Like the British but more famous Burberry, Aquascutum's windbreaker was the first military product, but soon became a fashion brand.

Reporters found that the announcement of the YGM trading company in Hongkong found that as early as October this year, it had issued a message that it had signed a memorandum of understanding on the sale of Aquascutum, which suggested that the price should be 120 million dollars, and that the final price of the spanaction would not exceed 5 million US dollars, and had already collected a $5 million deposit which was not refundable to the "recommended buyer", but the document did not disclose the specific information of the buyer. YGM's clothing business includes five brands: in addition to the biggest brand Aquascutum, there are Ashworth, J.Lindeberg, Michel Ren and Guy Laroche. Among them, Aquascutum has 146 retail outlets worldwide, with the largest number in mainland China and 96 in the world.

Although the two sides have not yet confirmed the news, the reporter did not respond to the telegram. However, a senior clothing industry veteran who knew the situation told the first financial reporter that the buyer was indeed Ruyi group. He told reporters that the two sides of the spanaction have a profound source. When YGM officially became Aquascutum's owner, Renown was the franchisee in Japan. Shandong bought Renown in 2010.

"Creating a fashionable high-end garment brand is still hard to achieve in the short term." Qiu Yafu, chairman of Ruyi group, has said that China's garment industry is still far behind developed countries in terms of innovation and design capability. In other words, the acquisition of overseas brands has become a "shortcut". According to the plan, the company plans to become a textile and fashion comprehensive enterprise.

　 Local enterprises are keen on overseas "treasure hunt"

Although the acquisition of Aquascutum is no longer an overseas brand, unsuspecting consumers will still think it originated from the UK, which is a good cut from a marketing storytelling perspective. As Qiu Yafu said before, everyone's consumption psychology is not yet accepted by high-end brands from China. "If it's a brand of France and Italy, people will think it is high-end."

However, the director of the company, deputy general manager and Secretary of the board of directors, Lan Di, said that the international brand is much less hindered when entering the shopping mall. It is rather difficult for domestic brands to negotiate with channels.

This also explains why many domestic enterprises will go overseas to "treasure hunt", and this situation is especially strong in 2016. According to Bloomberg data, the total amount of overseas acquisitions by Chinese companies has reached 502 billion since 2016, which is more than doubled from 24 billion 300 million US dollars in the same period last year.

For clothing and related accessories brand, according to the first financial reporter is also aware of a few. In addition to the acquisition of Ruyi group, Vigna S also announced that he planned to buy 5 billion 700 million yuan to buy Korean fashion brand Teenie Weenie in China, while he contributed hundreds of millions of dollars to buy German brand Laur L, American Ed Hardy and French brand IRO at one go.

For different enterprises, the acquisition is obviously a supplement to their business, for example, Ruyi group is extending its business domain from the textile manufacturing field to the high-end brand clothing field. And the song is clearly a derivative of its own product line. Laur e l is all career women, Ed Hardy is the American street breeze and IRO are full of French sentiment, and through the acquisition of the song, it also spanformed from a single brand clothing company to a multi brand group.

The advantage of domestic enterprises is that they can spanfer their production to factories closer to home and lower cost when acquiring international brands with clothing as the core, thereby increasing profit margins. At the same time, they can also increase sales with brand charisma and their ready American and European distribution channels.

These local clothing predators are obviously optimistic about domestic consumption.

Li Juan, CO head of Fuxing fashion group, said that although the growth of domestic apparel industry is not as good as that of the past ten years, the growth rate is slowing down, but the trend of overall growth remains unchanged. From the perspective of market space, the rise of the middle class and the convenience of the electricity supplier make the consumer groups gradually subdivided and precise. The layout of the low price, fast fashion and multi class is still the mainstream, but the light luxury brands from Europe and America will gradually gain people's heart because of its fashion design, exquisite selection, acceptable price and good taste.

But not all overseas brands are "treasures". Taking a look at those companies, their reputation and performance are different, some are on the rise, others are on the bright side. In addition, how to continue to maintain the brand "honor" is a difficult problem for domestic companies to overcome. Like Japan's problems, the "made in Japan" in 1970s also has a negative image. Today's "made in China" also has this problem.

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