Garment sales channels in the mainland have developed from the department stores, specialty stores and rural markets of the past to multiple sales channels, ranging from warehouse-style shopping centres, supermarkets and chain stores, specialised garment markets, mail-order, TV and online sales.
Department stores: In the past, large department stores were the main channels through which garments were sold. In recent years, as e-commerce has flourished, retail sales of garments in department stores have been declining. According to Euromonitor, garment sales in department stores accounted for 41.2% of the overall garment market in 2013, but this figure dropped to 26.4% in 2018. Meanwhile, the market share of online garment sales rose from 7.3% in 2013 to 31.8% in 2018.
Specialised garment markets: As a mature model for the distribution of garment products after years of development, these markets are achieving good economic results and social influence, while establishing a sizeable industrial base. China’s main specialised garment markets are located in three regions:
South China region: Represented by Guangdong and Fujian, the specialised garment market in the South China region enjoys the advantages of having an early start, a free flow of information, favourable geographic location and a solid industrial base. In Guangzhou, a specialised garment market has been formed, consisting of a Liuhua cluster centred around the Baima garment mart and a Shahe cluster centred around Shadong. More than 10 wholesale centres are located within the Liuhua garment wholesale commercial district. Humen Town in Guangdong is another area where a lot of garment wholesale activities take place. Fumin Commercial Building and Huanghe Fashion City are two prime examples.
East China region: The garment wholesale markets in East China are mainly found in Zhejiang, Jiangsu and Shanghai. Thanks to the geographic location and excellent development model of the Yangtze River Delta, the East China region garment economy has, in some ways, surpassed its Pearl River Delta counterpart. Notable examples of specialised garment markets include the Qipu Lu garment wholesale market in Shanghai, Merchants Mall in Changshu, Light Textiles City in Keqiao, the Woollen Sweater Market in Puyuan, Sijiqing Market in Hangzhou, and the Leather City in Haining.
North China region: The specialised garment markets in North China are mainly clustered around Beijing, Tianjin, Hebei and Shandong. Currently, the Muxiyuan Commercial District in Beijing is most representative of the specialised markets and is the largest garment distribution market north of Yangtze River. The main trading markets for textiles, garments, footwear and headwear in Shandong include Jimo Garment Wholesale Market, Zichuan Garment City, Zibo Zhoucun Textiles World and Luokou Garment Wholesale Market in Jinan.
Specialty stores: Selling in specialty chain stores is now a main model of branded garments sales and quite a number of enterprises are adopting a combination of franchised stores and self-operated stores. This can compensate for the shortcomings of not having sufficient control in franchising, while avoiding the risk of investing too much in self-operated stores. Large, powerful brands tend to prefer self-operated stores so as to maximise brand influence. Many brands are stepping up efforts to develop specialty stores as a way to raise profile and enhance image.
Some major garment specialty stores have now been reinvented as smart stores. Their facilities include ‘smart interactive screens’ offering suggestions on how to mix and match clothing as well as discount information, as well as ‘3D dressing mirrors’ allowing virtual fittings in front of a display panel to help save consumers fitting time, and ‘RFID tagging’ to manage inventory, enhancing warehousing management quality and accuracy of product information.
Garment supermarkets and discount stores have become a new component of the garment retail landscape. Garments sold in supermarkets are usually not the trendiest, but prices are more affordable and quality is more assured. There are also some garment brands which want to capitalise on the popularity of supermarkets to raise profile and boost sales. In discount stores, brands can maintain their advantages while offering discounted prices as in wholesale markets.
Store-in-store model: As the name implies, these are stores established in other stores, mostly large-scale retailers such as department stores. Store-in-store for fashion is basically a particular brand specialty store, with its form and management usually freer than other concession counters in the same store. They are, however, not as completely free from restrictions as if they were independent because they still have to align with the overall operation of their respective hosts. The decoration of a store-in-store usually has a unique style of its own in order to highlight the cultural characteristics of the brand. The heavy shopper traffic of gigantic stores is often the main attraction for manufacturers to set up stores-in-store there.
Online shopping market: China’s online market has already come of age. According to figures from the National Bureau of Statistics, the size of China’s online shopping market reached RMB7,019.8 billion in 2018, up 25.4% year-on-year and accounting for about 18.4% of total consumer goods retail sales. According to market surveys, the garment e-commerce market was worth RMB820.5 billion in 2018. Brands and channel businesses are scrambling to start e-commerce mainly because it allows cost-saving as well as tracking of market and customer data, and is a major channel for inventory clearance.