September 12, 2004
A radical shake up is needed among Chinese garment manufacturers if the country is to take a share of the top end market.
This was the message from officials and industry experts at the Dalian International Fashion Festival which opened in Dalian on Friday. And they urged Chinese firms to sharpen their competitiveness in both domestic and overseas markets.
From the perspective of the technology employed, brand and added values, "the Chinese garment industry is in an inferior position when competing with enterprises in developed countries," said Long Yongtu, secretary-general of the non-governmental organization Bo'ao Forum for Asia.
China continues to focus on the low-end market, while the high-end remains dominated by big overseas firms, the former Chinese vice-minister of Foreign Trade and Economic Co-operation told a garment culture forum on Thursday in Dalian.
"To solve the problems, the most important thing is to make our own brands well received in the world market," Long said.
As China opens up to the outside world, the country is fast becoming one of the largest markets in the world.
"This large market has created good opportunities for nurturing Chinese brands," said Long.
In response to a question about profits in the domestic garment industry, marketing strategist Milton Kotler, chairman of US-based Kotler Marketing Group said: "In the market, producers' profits become less and less. They stand at 3 per cent at present, compared with more than 10 per cent in the past."
"In the whole value chain, production amounts to 10 per cent, distribution takes up 50 per cent while brand accounts for 40 per cent," said Kotler.
Foreign businesses have done a better job in the Chinese market by setting up distribution outlets and bringing in well-known names, such as Gianfranco Ferre and Dunhill.
"We will invest heavily in the Chinese market in the coming years," said John Durnin, chief executive officer of Richemont Luxury Asia Pacific Limited.
His company has opened 58 stores in 35 cities in China in the past 11 years selling Dunhill menswear.
"China is a young market, but people are just getting used to luxuries," said Durnin.
The Dalian International Fashion Festival and Dalian International Garment Fair - a key part of the festival - provide an opportunity for the domestic fashion industry to learn from the advanced experience of their overseas counterparts, said Li Shuzhen, director of the fair's organizing committee.
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