Wen | Dou Xuan
Editor| Qiao Qian
The Hanfu industry, which is brought on fire by young people, has begun to encounter a wave of store closures in the past six months.
On March 7, the Hanfu brand Ducheng Nanzhuang announced the official closure of the store in the circle of friends, the old well-known Hanfu brand that has been in the top ten of the Hanfu output value list for the past few years, and fixed the Hanfu business that began in 2008 on the last time in early March.
At the same time, Yijin Jiudu, Huazhixi and many other well-known Hanfu brands in the circle have also announced the closure of stores and clearances. In fact, according to incomplete statistics, since the second half of 2021, nearly 20 well-known Hanfu brands have announced the closure of stores.
Some of the stores such as Lan Ruoting, Ewhadu, Ermujia, etc. said that they would close the store for adjustment or reorganization in the future, such as the brands of The Capital City Nanzhuang, Pouring Cup Order, and Nanju Weaving, and directly announced the permanent closure of the store, or transferred the brand.
Why is the Hanfu market, which is predicted to have 400 million potential users, encounter a low tide at the moment when the national tide of consumption is prevalent?
The tide of store closures under the epidemic
To the public, the names of these Hanfu brands sound strange. But for Hanfu consumers, Lihuadu, Lan Ruoting, Ducheng Nanzhuang and Yijinjiu are all well-known brands in the circle, and each has millions of fans on Taobao.
The collapse of many closed-store brands came without warning. For example, the capital City Nanzhuang, which has just announced the closure of the store, has been constantly updating, and in an interview with reporters last year, the founder Peach Blossom also revealed that he was busy building his own factory and looking for financing externally.
What surprised the colleagues in the Hanfu circle even more may be Lan Ruoting, who closed the store in the second half of last year, this brand has been the manufacturing machine of Hanfu in recent years, and the revenue in 2020 has exceeded 100 million. Even if the store has been closed in August, Lan Ruoting's output value still ranks fifth in the annual Hanfu output value list, and the two new products launched in the past two years are still among the top two in the annual Hanfu single product ranking in 2021.
The picture is from the "2021 Hanfu Product Survey Report" produced by the self-media Hanfu Information
There is news that Lan Ruoting will reorganize with another well-known Hanfu brand Chi Xia in the future, but as of now there has been no public action.
However, if you look at the revenue data, the entire Hanfu industry as a whole has declined.
According to the "2021 Taobao Hanfu Merchant Output Value Ranking" of Hanfu Information Statistics, the total output value of the top 30 has dropped by 17.32% compared with 2020. A number of well-known Hanfu brands have experienced a serious decline in revenue, in the top ten Hanfu brands in 2020, the output value of Lan Ruoting, Hanshang Hualian, Hua Chaoji, and Dongyuetang fell by 61.88%, 67.29%, 44.97%, and 72.17% respectively.
The picture comes from the self-media Hanfu Information
The decline is so large that it seems that it is not difficult to explain why so many Hanfu stores have chosen to close. An internal employee of Ducheng Nanzhuang told 36Kr that the store was closed in order to "stop the loss in time", and the treasurer of another Hanfu brand, Huajixi, also mentioned in the Weibo announcing the closure of the store that the reason for choosing to stop was because the other work income of the two founders was much higher than the income obtained from operating the Hanfu store.
This is in stark contrast to the explosive growth of the Hanfu market in previous years. According to the China Commercial Industry Research Institute, from 2016 to 2020, the size of the Hanfu market quickly rose from 370 million to 8 billion.
Taking the return of the head Hanfu brand to Hantang as an example, the sales in 2016 were only more than 6 million yuan, and by the end of 2019, the revenue had exceeded 100 million yuan, and the store was often out of stock.
However, the emergence of the epidemic has directly affected this vertical market that is still in the early stages since 2020. According to the statistics of Hanfu Information, the sales of the top ten Hanfu brands in 2020 have dropped by 23.74% compared with 2019.
A founder of the Hanfu brand told 36Kr that the impact of the epidemic is too serious, and the entire industry is currently more difficult. Quite a number of Hanfu offline stores are closed. Although the vast majority of Hanfu brands are mainly engaged in e-commerce channels, after the emergence of the epidemic, the offline activities of Hanfu in various places have dropped sharply, and the demand for user purchases has also declined, which has directly led to the deceleration of this track.
Another industry insider said that although the spread of Hanfu on social media has become increasingly mainstream in recent years, and the basic disk of Hanfu's users is still growing, it may not be as much as imagined when it is converted into substantial consumption.
In order to be able to cover a wider range of customers, many Hanfu brands have begun to add elements such as secondary yuan, JK, Iolita and other elements to their products, such as returning to Hantang, Hanshang Hualian and other brands, and have set up their own children's clothing and men's clothing lines. But for now, even in 2019, when the industry broke out, there are only three Hanfu brands with sales of more than 100 million.
The inner volume is serious, reshuffled
The overall market size expansion is less than expected, but the internal volume of the Hanfu market in the past two years is quite serious. According to the statistics of Ai Media Consulting, from 2018 to 2020, the number of Taobao Hanfu merchants rose from 815 to 1518.
In the past two years, the entire Hanfu circle has experienced a price war, which is another important reason for many established merchants to be "swept to death". Lan Ruoting, who has closed its store, was once the driving force of this price war.
In the early years, because the demand for Hanfu was difficult to support mass production, the pricing was not cheap, and a set of Hanfu was often four or five hundred, or even thousands of yuan. However, in the second half of 2018, Lan Ruoting launched the Ming system set "Taiping Youxiang", a minimum of only 199 yuan, which soon set off a buying trend in the Hanfu market, and sold a total of 210,000 sets that year, which was called "Hanfu School Uniform" by many colleagues.
Some insiders once revealed to 36Kr that the same set of styles, other brands may give 2-3 times the pricing, the emergence of Lan Ruoting, directly broke the low price ceiling of Hanfu at that time.
At the beginning of 2020, Lan Ruoting once again followed the law, launched a set of Song system "Spring Color Here" that only needed 119 yuan, sold 550,000 sets on the day of the launch, and in 2020, the output value of this single product alone reached 35 million yuan.
The official picture of "Spring Color Here", the picture comes from Lan Ruoting's official WeChat.
Through the continuous introduction of low-priced and explosive styles, Lan Ruoting's revenue in 2020 reached 130 million yuan, known as "Uniqlo of Hanfu". However, the positioning of low prices also makes Lan Ruoting's profit margins very limited. Founder Zhang Jingwen once said in an interview that in the early days, she did not make money at all, and even posted money to do business.
After Lan Ruoting, a considerable number of Hanfu stores positioned at a price of 200-300 yuan joined, setting off a trend of low-price competition, which also forced many Hanfu merchants to "kill low prices" and grab the market.
What makes this inner volume more serious is that CaoXian has transferred from the declining performance clothing industry to the Hanfu market, and its playing style is very "Pinduoduo": it does not pay attention to the original design and shape, and some stores even directly copy the original design, and replace the Hanfu process with a considerable part of the modern fashion process to reduce manufacturing costs, mass production, and then sell at ultra-low prices.
Through this low-priced and large-volume play, CaoXian soon won a third of the Hanfu market. Because of the impact of ultra-low-priced goods, some old well-known Hanfu brands have reduced their new styles and in-store SKUs last year, and some high-priced Hanfu brands have also opened a parity sub-line to join this price war.
In order to control costs and stabilize quality control, in the past two years, a considerable number of head Hanfu brands have begun to build factories by themselves, but the vast majority of Hanfu brands do not have this strength when they start.
Unlike modern fashion, which can achieve a profit margin of 100%, or even several times the cost, Hanfu may only have a profit margin of about 30% due to its small output and complex process.
The already low profit margin, and then encountered a low-priced inner volume, many Hanfu brands have fallen in the price war. Some practitioners revealed that since 19 years, he has seen a large number of new merchants enter this circle, but basically all of them are dead, and now if there is not enough strength to support, it is almost impossible to do it.
A Hanfu practitioner with the ID named QueMo broke the news in the self-media that Lan Ruoting's closure was caused by frequent price wars in the sinking market and increasing operating costs, which was no longer enough to maintain the normal operation of the store. According to the practitioner, as early as June 2021, Lan Ruoting had already begun to discuss the restructuring internally.
The fierce inner volume is also rapidly rewriting the pattern of the Hanfu market. Brands such as Ducheng Nanzhuang and Yijin Jiudu were complained by users on social platforms before closing their stores, "aesthetics are not online" and "design and quality are getting worse and worse".
While the revenue of most well-known and established Hanfu brands has declined, a considerable number of new brands have emerged rapidly. Looking at the Hanfu brand ranking in 2021, nearly half of the brands are newly entered brands. It has led the Hanfu market for more than thirteen years in 20 years, and last year's output value has reached 300 million yuan, an increase of 14% over the previous year, which is nearly three times the output value of the second-place Chixia.
Backed by the Hangzhou e-commerce supply chain, founder Xiao Cardamom himself is a well-known Internet celebrity in the Hanfu circle, good at the operation of short videos and live e-commerce. It does not rely on price advantages, but through the joint design with multiple IP such as Glory of kings and Disney, it has produced a number of star items. For example, last year's more than thirteen sales of the first "Yao meets the sacred deer", is more than thirteen and the king of glory launched a joint model.
More than thirteen original designs of "Yao meets the sacred deer", the picture comes from the official Taobao store.
At the same time, more than thirteen years last year has also obtained hundreds of millions of yuan of investment from well-known companies such as B station and bubble mart. It is reported that another head Hanfu brand that got financing last year has returned to Hantang and has also begun to look for new financing this year.
In the cold winter of the industry, sufficient funds and steady investment may also be an important condition for survival. But looking at the entire track, there are very few Hanfu brands that can get financing. Even in 2021, when new consumer investment is hot, the Hanfu brands that can get financing on the Hanfu track are only more than thirteen, returning to 2-3 head brands such as Hantang.
Some insiders revealed, "Many Hanfu brands want to raise funds, but they are not willing to lose their main control, which further leads to difficulties in financing." In addition, many Hanfu brands are still stuck in the workshop mode of operation, which is also one of the important reasons for the capital to be deterred.
An investor told 36Kr, "This track is still too small, the entire plate is a total of 10 billion, and the offline format is seriously affected by the epidemic, if you want to invest, you may still invest in a head like thirteen." ”