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The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Deep Sound Original · The author | Lü Yue

Wearing Hanfu on the streets is no longer a fuss.

After several consecutive years of high attention at the public level and the favor of young people, Hanfu quickly exploded out of the circle and stood on the limelight. On the supply side, Tianyancha data shows that in 2019, Hanfu-related registered enterprises have reached thousands, an increase of 175% year-on-year. On the demand side, iResearch report data shows that the sales scale of China's Hanfu market has surged from 190 million yuan to 6.36 billion yuan in 2015-2020, and the scale is expected to exceed 10 billion yuan in 2021.

Capital has long been moved. More than thirteen, back to Hantang, Huashou Jiuzhou, Oriyu ji and other head Hanfu brands and twelve lightyears, poetry and kaleidoscope and other three pits of collective brands including Hanfu have obtained financing, and even the cross-border Hanfu national style photography brand Pan Women's Fang has also become a capital darling.

The scale of tens of billions, the love of young people, the rise of the national tide, no matter from that point of view, the prospects of the Hanfu industry are a good and extremely prosperous. But the reality seems to be much more "calm" than the pomp and circumstance described in the report.

Since 2020, the market indexes of Hanfu, the main brands of Hanfu and the relevant managers (Baidu Index, Douyin Index, etc.) have shown a significant downward trend. According to the statistics of "Hanfu Information", the total sales value of Hanfu merchants in Taobao's top 10 sales will be nearly 900 million yuan in 2020, but this figure has also decreased compared with 2019.

The dispute over the shape of Hanfu, plagiarism and copycats, the premium of the head brand, the quality control of products, and the intensification of competition in industrial distribution centers... There are many constraints in the industry, and there are many problems under the boom.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence
The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Source: Unsplash

Cottages are a thing of the past, but they are caught in the quagmire of "price wars"

Once the most prominent problem in the Hanfu industry was the cottage.

Due to the inherent attributes of circle layering, Hanfu lovers who call each other "tongpao" not only like a certain piece of clothing or jewelry, but also have a recognition of circle culture and identity. This makes the brand awareness of core consumers extremely strong, extremely sensitive to design, layout and other issues, and the "Mountain Zheng Dispute" often appears in many social news with the phenomenon of "wearing cottage Hanfu and being accused of being on the street".

Hanfu's cottage problem is actually not difficult to understand - the industry is hot, consumption has soared, many garment industry practitioners with manufacturing capabilities but lack of brand awareness are trying to get a piece of the pie, and they do not do original design, direct copying is obviously the most worry-free way to make money. Coupled with the fact that Hanfu is originally a design that quotes ancient elements, it is difficult to directly identify some imitations after "fine-tuning" on styles, patterns, and patterns.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Source: Hanshang Hualian Taobao flagship store

In 2019, there was a turning point in the problem of copycats in the industry. The head Hanfu brand Hanshang Hualian sued a number of Caoxian merchants who directly copied the original in court, which played a rather strong deterrent effect in the Hanfu industry, and Caoxian Hanfu was also directly pulled into the bottom of the industry's contempt chain.

The risk of copycats has intensified, and brand awareness in the industry has begun to awaken. A founder of the Hanfu community platform told "Deep Sound" that 2019 is not only a hot peak of the Hanfu industry, but also a demarcation point. After 2019, the "mountain dispute" is gradually no longer the core issue of the industry. Merchants who started by plagiarism and only wanted to make quick money may never pay attention to "original design" in the past, but after taking this link into account, they actually found that it is neither expensive nor difficult to make original.

"Everybody's buying a design." According to the founder of the platform, the number of people in the Hanfu design link is uneven, and the number of enthusiasts is far more than that of professional designers. This kind of design draft produced by hobby is quite large, open the Hanfu related posts or community can see that many people are holding the design draft "selling". Therefore, the price of the design draft is extremely low, simple can be taken down for a few hundred yuan, and the relatively more designable one can only buy out of one or two thousand yuan. Some brands even only need to send samples to designers, or give a certain share after the product is sold, and they can get the design draft without spending money.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Source: Hanfu related stickers

Small and medium-sized brands can quickly enter the production process with low-cost simple design drafts. The head brand that emphasizes uniqueness and design can also be screened by professional designers after collecting a large number of design drafts, and then choose the appropriate fabric and process to make sample clothes.

Such an original design without threshold may be difficult for consumers to accept when Hanfu was still a niche circle and the dispute over form and system was quite sharp. But now with the big strides of Hanfu to break the circle, doing Han elements, doing more everyday wearable Hanfu is a major trend for the market, most brands will not be too entangled in whether the layout is absolutely compliant, and this also makes the difficulty of design reduced again.

Although the problem of copycats is no longer prominent, after 2019, the industry has ushered in a new problem - "price war".

Once Hanfu left the impression left by the public is that the production is time-consuming and the process is emphasized, so the price is high, and the price of about five hundred yuan is already a low price. But now open the e-commerce platform, dozens of yuan of Hanfu abounds, even the three-digit Hanfu is mostly in the price range of 100-300 yuan.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Source: Pinduoduo

The emergence of low-cost Hanfu is naturally inseparable from those clothing practitioners who have great advantages in the supply chain. Unlike the early brands created by interest, these merchants regard Hanfu as a regular "business" rather than a special "hobby", and how to use their advantages to reduce costs and expand sales are the most basic ideas from the perspective of doing business.

Cao County is the most typical case. With the performance costume industry base accumulated over the years, CaoXian has "transformed and upgraded" to the Hanfu industry without difficulty, and because the industrial cluster has also maintained its low-cost advantage. Locally, family workshops can also realize the "front shop and back factory" model.

Many merchants have beaten the price of Hanfu from the high-end price of more than 500 yuan, but the low-price competition has also begun, which has brought a very big impact to the Hanfu industry.

The first is the reduction of the overall gross profit of the industry, and the meager profits make many original small brands and small studios face huge survival pressure. To survive, merchants must further reduce costs, which can easily fall into a vicious cycle of reduced product quality. Some big brands originally only took the high-end line, and under the price war, they may go to the low-end of the low-priced price, and it is difficult for the brand to stand up.

Second, low-price competition is taking a toll on the reputation of the industry as a whole. When extremely low-priced and low-quality products occupy most of the market, short-term consumers may think that "preferential value", but in the long run, it will form a stereotype of the industry as a whole. And long-term low profits mean that the industry will continue to lack funds to invest in brand building, and the development path will only become narrower and narrower.

The sales problem is not solved, and the breaking of the circle is still in progress

In the market competition where many small businesses concentrate on fighting price wars, many problems in the sales process of Hanfu are also more prominent.

First of all, online sales, Hanfu merchants have to face the long sales cycle, poor quality control of these two often mentioned problems.

The sales cycle is long, on the one hand, it is indeed because the Hanfu process itself is relatively complex and time-consuming, and the overall production cycle is lengthened. On the other hand, it is also because the audience range of Hanfu is relatively small, and its sales are still considered "niche", merchants cannot order production in large quantities like other conventional clothing, and upstream foundries are not easy to take orders.

Now, the overall gross profit of the industry is low, and merchants will not choose to bear the risk of inventory backlog. Therefore, Hanfu can only adopt the model of pre-sale + tail for a long time, and determine the production volume in reverse by sales volume.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Source: More than thirteen, back to HanTang, Hanshang Hualian Taobao flagship store

The model of finding a foundry cooperation also lays hidden dangers for quality control problems. The small foundries found by small brand merchants have a limited level of production technology, and if they want to reduce costs, the production process and quality cannot be forced. Although large brands can choose and more professional foundries, they need to "one-to-many" cooperation because of more SKUs, so that the cost and difficulty of communicating with the factory or going deep into the production process are higher.

Of course, there are also head brands willing to solve problems by building their own production capacity. For example, the brand returned to Hantang's self-built cutting center, embroidery factory and sewing factory in Pengzhou City, Sichuan Province, and the production cycle can be compressed to about 45 days, and the quality control can be more refined. However, this is obviously something that very few brands can do, because the difficulty of the brand going deep into the production link is not low: the scale of the factory is small and its production capacity may be insufficient, and the brand still has to find a foundry; the scale of the factory is large, and the brand's own sales are likely to be unable to support the operation of the entire factory, and it is bound to have to take orders.

In addition to online sales, many head brands such as Hantang and Oriyuji have also opened physical stores offline.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

Chengdu Hanfu brand store

It is obviously more feasible to do a brand collection store than a single brand store. Putting aside the simplest and most direct cost of opening a store, more problems are actually focused on goods. It is not difficult to understand that there are not many SKUs of a single brand, and if they are placed in offline stores, the consumer's choice will be very small, and it is difficult for stores to ensure the repurchase rate. At the same time, Hanfu is also a non-standard "combination" product, a set often contains multiple accessories and single products, and a single brand with few SKUs will be more difficult to do offline.

Offline stores often carry multiple responsibilities such as customer recruitment, improving service experience and establishing brands, if they only appear in brand collection stores, it is actually difficult for a single brand to build a brand. However, in the view of Hanfu practitioners, it is still too early for the Hanfu industry to talk about "brand".

Because the threshold for design, production and sales is not high, there are many self-employed, small studios, and small brands in the Hanfu industry, and there are no obvious differences in their products, and these players can only say that they have their own "trademarks" rather than established brands.

In contrast, only a very small number of people who stand at the top of the pyramid like Thirteen Can be called "brands", which is not because capital blessing has gained an aura, but because these brands have their own big IP with traffic.

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

More than thirteen small cardamom, weaving feather set Xu Jiao

For those "fellow robes" who are really in the Hanfu circle, the brand founder and the model that the brand has been bound to for a long time may be IP. They may be the heads of regional Hanfu societies, or they may be well-known photographers, models or bloggers in the circle.

For example, more than thirteen founders, Xiao Cardamom, has more than one million fans on the B station, and the number of fans on Weibo has reached 5.06 million; Hanshang Hualian's model 108,000 miles is evaluated as "ten miles and a smile, the wallet collapses" in the circle; ori yuji is a brand management company and star Xu Jiao jointly created. This is actually similar to the model of internet celebrity e-commerce: the well-known KOL directly acts as the spokesperson for the brand, and the fans it has accumulated over the years are the main buyers.

Because of the characteristics of Hanfu's interest culture, the appeal of IP has always been a key element. This makes the hanfu brand want to break the circle to the public, not only rely on the KOLs in the original circle, but also go to the big IP in other fields to do joint names. The response after the launch of more than thirteen joint models with the game "Glory of the King" has been excellent, one of which is still the first popular model in the store; Han Shang Hualian and "Know It or Not" have cooperated to launch 14 joint Hanfu, and the sales growth after the launch is also extremely amazing; the return to Han Tang and "Sword Net 3" linkage, Hua Chaoji is jointly named with "Chang'an Twelve Hours".

The real dilemma of Hanfu: price war, supply chain constraints, and big IP dependence

More than thirteen are jointly named with IP such as "Qingping Le" and "Glory of the King"

The joint name with the IP of film and television games has allowed Hanfu brands to jump out of the original circle to seize more young groups, and also promoted the consumption enthusiasm of the Hanfu market. However, this is more of an exclusive play for the head brand - because the top, influential IP resources will naturally tilt to the head brand, and it is difficult for small brands to seek cooperation with large IP resources.

Whether it is production, sales, brand construction, market development, in the eyes of the industry, the Hanfu industry is still "immature": the clothing industry to make quick money people to accelerate the development of the industry, but also disrupted the situation; capital into the game, but the "small and beautiful" business model and capital want the exponential expansion path does not match. These are the problems that the industry urgently needs to solve behind the "great" forecast value.

The emergence of new business models such as Hanfu photography, Hanfu leasing experience, cultural tourism and Hanfu integration may broaden the development ideas and profit space for the Hanfu industry, and even become an indispensable part of the industry. However, these attempts have just begun, and more professionals entering the industry and the formation of a rational competitive environment may be the key to promoting the industry into a positive cycle.

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