(Article taken from Business Week and was published on January 11, 2008)
Vente-privee.com is a six-year old French company that holds invitation-only closeout sales over the Internet—and attracts a million unique visitors a day who buy, on average, 40,000 items daily. It is named for the frenzied invitation-only private designer overstock clothing sales that are held in Paris and known as ventes privees. Fashion houses had found ventes privees as a reliable and time-tested way to get rid of overstock. But now such luxury labels and even consumer products companies are increasingly turning to the online alternative for such inventory-clearance over the Internet proving to "have created an entirely new channel for brands". The company has already attracted more than 600 brands including such names as Givenchy, Dolce & Gabbana, and Armani Casa. Now such exclusive brands are being joined by mass-market sellers such as Adidas, Swatch, and Mattel. For such brands, the lure is a greater control over protecting their brand image thanks to Vente-privee.com's exclusive merchandising contracts along with greater efficiency while also earning twice the margins than would have been earned via more traditional closeout sales methods.
Overstock is unavoidable in manufactured goods, thanks to everything from fashion misses to production planning mistakes to unexpected weather. On average, it amounts to between 5% and 10% of all merchandise—and sales of inventory closeouts top $30 billion annually in the U.S. alone. With a neverending supply of overstock along with Vente-privee.com's unique combination of exclusivity, selection, price, and value-added merchandising is paying off for the company. Realizing the opportunity within this niche, others are trying to jump in on the game, however, having built up strong relationships with brands, Vente-privee.com is expected to continue outshining all others (competitors) that try to follow their lead. In fact, the company even claims to be 30 times larger than its nearest rival.
It is important to continually keep up with the latest retail trends, in particular, those that relate to fashion. Good to know how designer brand overstock is redistributed in a timely yet profitable manner. Such e-commerce is only going to continue growing in the future.
Friday, February 27, 2009
"A Textile Capital of China is Hobbled by the Downturn"
(Article taken from the New York Times on February 27, 2009)
Shaoxing, China is a coastal city 100 miles southwest of Shanghai that took off in the 1980's as small businesses producing chemical fibers took over its rice paddies. Since the 80's, Shaoxing has become one of the world's largest textile centers. It's 20,000 textile and garment factories were bustling, always bustling with workers at least 6 days of the week producing goods sold at big American retailers such as Wal-Mart and Gap. Now with the economic downturn, textile companies are struggling to survive and many factories in this Chinese city are being forced to shut down as owners face mounting debts and bankruptcy. Beijing issued a dire warning in December: As many as two-thirds of the country's apparel and textile companies could go broke in 2009. Some companies have seen a third of their orders being cut within the last few month while others have seen even larger losses. Beijing has been paying close attention to the troubles facing the textile and apparel industry- it is a $450 billion industry that employs over 20 million workers-making it crucial to China's economy.
With this said, the government has already issued a $586 billion economic stimulus package to help keep factories open. Beijing has also responded with a series of measures to aid textile producers, including: tax credits & rebates, forcing state-owned banks to approve low-interest loans to factory owners, lowering of water fees, and more. However, the struggle is being further complicated by a new labor law along with fierce competition pushing up young migrant workers wages by more than 30 percent in the past 2 years along with fabric and textile buyers from America and Europe coming to expect cheaper prices, year after year. Experts warn that what happens in cities like Shaoxing "could be a barometer of China's trading might, and a window into its social conditions". With millions of migrant workers losing their jobs in a string of coastal towns, Beijing is becoming increasingly concerned about social and political unrest.
Industry officials are staying optimistic stating that "China's textile industry will continue to thrive because of textile-cluster cities like Shaoxing that dominate a particular end of the business by specializing and competing fiercely on price". I believe such attributes of China's textile industry are what they must focus on to be able to even possibly survive the worst economic downturn in three decades for this Asian country.
Within the apparel/textiles industry it is important to understand the recent trends in globalization and to be observant of the effects that the economy is having on a global level and to relate how this affects this industry and the retail sector as a whole.
Shaoxing, China is a coastal city 100 miles southwest of Shanghai that took off in the 1980's as small businesses producing chemical fibers took over its rice paddies. Since the 80's, Shaoxing has become one of the world's largest textile centers. It's 20,000 textile and garment factories were bustling, always bustling with workers at least 6 days of the week producing goods sold at big American retailers such as Wal-Mart and Gap. Now with the economic downturn, textile companies are struggling to survive and many factories in this Chinese city are being forced to shut down as owners face mounting debts and bankruptcy. Beijing issued a dire warning in December: As many as two-thirds of the country's apparel and textile companies could go broke in 2009. Some companies have seen a third of their orders being cut within the last few month while others have seen even larger losses. Beijing has been paying close attention to the troubles facing the textile and apparel industry- it is a $450 billion industry that employs over 20 million workers-making it crucial to China's economy.
With this said, the government has already issued a $586 billion economic stimulus package to help keep factories open. Beijing has also responded with a series of measures to aid textile producers, including: tax credits & rebates, forcing state-owned banks to approve low-interest loans to factory owners, lowering of water fees, and more. However, the struggle is being further complicated by a new labor law along with fierce competition pushing up young migrant workers wages by more than 30 percent in the past 2 years along with fabric and textile buyers from America and Europe coming to expect cheaper prices, year after year. Experts warn that what happens in cities like Shaoxing "could be a barometer of China's trading might, and a window into its social conditions". With millions of migrant workers losing their jobs in a string of coastal towns, Beijing is becoming increasingly concerned about social and political unrest.
Industry officials are staying optimistic stating that "China's textile industry will continue to thrive because of textile-cluster cities like Shaoxing that dominate a particular end of the business by specializing and competing fiercely on price". I believe such attributes of China's textile industry are what they must focus on to be able to even possibly survive the worst economic downturn in three decades for this Asian country.
Within the apparel/textiles industry it is important to understand the recent trends in globalization and to be observant of the effects that the economy is having on a global level and to relate how this affects this industry and the retail sector as a whole.
Friday, February 13, 2009
"A Morningstar for Manufacturing"
(Article taken from the Next Innovation section of Fast Company, March 2009 issue)
Panjiva brings intelligent search and better information to the fashion industry's hunt for suppliers. It all began when Josh Green needed a component supplier in China for an electronics firm that he had been working for. With this special assignment it struck Green the lack of information and transparency available to sourcing professionals
Realizing this need, Green sat down with his friend James Posta, a computer scientist at MIT. Posta felt he could design software that would do for importing [of information] what Google has done for the Web: make search smarter. So in 2006, the duo founded Panjiva. They began with the apparel industry and gathered data from more than 200 sources- governments, private certifiers, not-for-profits. Then they digitized, cleaned, and collated the obtained data to create detailed snapshots of more than 70,000 suppliers, with each being rated from 1 to 100, based on criteria such as the supplier's environmental record and experience serving the U.S. market.
The company charges for database subscriptions and sells reports on individual suppliers. Panjiva has attracted a roster of stellar, diverse fashion icons including Diane von Furstenburg along with almost 90 apparel companies, such as Elie Tahari, J.Crew, Reebok, and Wal-Mart. Green and Psota never intended for their business to be fashion-only and are hoping to broaden their database to include other industries. In fact, Green has had discussions with brands in several other industries including food, housewares, and office supplies and he expects Panjiva's database to eventually have profiles of several million suppliers in a wide array of industries. The keystone to success for Panjiva is trustworthiness- if even one rating is incorrect or bogus it could potentially cause their reputation to plummet.
This article is important to me because as an apparel major, I need to stay up to date to know the latest in trends within the fashion supply chain.
Panjiva brings intelligent search and better information to the fashion industry's hunt for suppliers. It all began when Josh Green needed a component supplier in China for an electronics firm that he had been working for. With this special assignment it struck Green the lack of information and transparency available to sourcing professionals
Realizing this need, Green sat down with his friend James Posta, a computer scientist at MIT. Posta felt he could design software that would do for importing [of information] what Google has done for the Web: make search smarter. So in 2006, the duo founded Panjiva. They began with the apparel industry and gathered data from more than 200 sources- governments, private certifiers, not-for-profits. Then they digitized, cleaned, and collated the obtained data to create detailed snapshots of more than 70,000 suppliers, with each being rated from 1 to 100, based on criteria such as the supplier's environmental record and experience serving the U.S. market.
The company charges for database subscriptions and sells reports on individual suppliers. Panjiva has attracted a roster of stellar, diverse fashion icons including Diane von Furstenburg along with almost 90 apparel companies, such as Elie Tahari, J.Crew, Reebok, and Wal-Mart. Green and Psota never intended for their business to be fashion-only and are hoping to broaden their database to include other industries. In fact, Green has had discussions with brands in several other industries including food, housewares, and office supplies and he expects Panjiva's database to eventually have profiles of several million suppliers in a wide array of industries. The keystone to success for Panjiva is trustworthiness- if even one rating is incorrect or bogus it could potentially cause their reputation to plummet.
This article is important to me because as an apparel major, I need to stay up to date to know the latest in trends within the fashion supply chain.
Friday, February 6, 2009
"The Motorola Sparrow: Retail's Handheld Powerhouse"
The Sparrow is a wireless palm-held device (still in prototype stages) featuring a touch sensitive back panel that keeps the screen free for viewing with the other side serving as a bar-code scanner and a credit card processor- among other things- and being a Motorola product, the Sparrow, also serves as a phone.
The Sparrow was given its name because of it's small, fast, and simple design and capabilities. The concept for the Sparrow began in 2006 when Motorola bought Symbol Technologies, a maker of bar-code scanners. At this point Motorola asked New York-based design consultancy Aruliden to help envision how their expertise could help serve the retail sector specifically. Aruliden cofounder, Rinat Aruh, states "The technology was already there- that's the beauty of the device" and the prototype of the Sparrow was developed quickly.
Shane MacGregor, director of advanced industrial design in Motorola's enterprise mobility division, says the Sparrow concept has been presented to potential clients and from which they have gathered feedback about what they'd want in an actual production model. MacGregor expects Sparrows to become popular in retail stores and states that Motorola already has "a couple of projects in the pipeline that will be either evolutions of this [Sparrow] or some derivative."
Such a device can really play a valuable roll in keeping the retail consumer happy. The bar-code scanner allows inventory to be checked immediately while the credit card processing ability allows for transactions to be made right on the sales floor. Such capabilities would allow for better service to the customer as their needs can be met quicker. It is important as a retail major about to step into a job to know what changes and innovations are on the horizon within my industry.
However fabulous it sounds, will the Sparrow really become "Retail's Handheld Powerhouse"? We shall see! I definitely think it has potential.
(article taken from the Next Futurist section of Fast Company: Dec 2008/Jan 2009 edition)
The Sparrow was given its name because of it's small, fast, and simple design and capabilities. The concept for the Sparrow began in 2006 when Motorola bought Symbol Technologies, a maker of bar-code scanners. At this point Motorola asked New York-based design consultancy Aruliden to help envision how their expertise could help serve the retail sector specifically. Aruliden cofounder, Rinat Aruh, states "The technology was already there- that's the beauty of the device" and the prototype of the Sparrow was developed quickly.
Shane MacGregor, director of advanced industrial design in Motorola's enterprise mobility division, says the Sparrow concept has been presented to potential clients and from which they have gathered feedback about what they'd want in an actual production model. MacGregor expects Sparrows to become popular in retail stores and states that Motorola already has "a couple of projects in the pipeline that will be either evolutions of this [Sparrow] or some derivative."
Such a device can really play a valuable roll in keeping the retail consumer happy. The bar-code scanner allows inventory to be checked immediately while the credit card processing ability allows for transactions to be made right on the sales floor. Such capabilities would allow for better service to the customer as their needs can be met quicker. It is important as a retail major about to step into a job to know what changes and innovations are on the horizon within my industry.
However fabulous it sounds, will the Sparrow really become "Retail's Handheld Powerhouse"? We shall see! I definitely think it has potential.
(article taken from the Next Futurist section of Fast Company: Dec 2008/Jan 2009 edition)
Friday, January 30, 2009
"All Dressed Up Like Art Galleries"
(Article taken from The New York Times on January 28, 2009)
“Tradition dictated that art be displayed in a clean space on a white wall, with nothing around it,” said Linda Warren, a dealer in Chicago. To stray outside the confines of the white cube was, she said, to risk a “perception that the artist is selling out.” However, as the economy continues to take a nosedive, such tradition is going to the wayside. Many galleries have found themselves shutting their doors as they face mounting overhead and declining sales. With this, many galleries are being forced to close so exhibitions are becoming more popular in restaurants, hotels, and even condo lobbies. Yet, even more art is making its way into the world of fashion. As fashion boutique owners are finding themselves unable to continue fully filling their retail space with high-end designer labels, they are now filling the space with local artists works. For example, Confederacy, a hot retail spot in boho East Hollywood that sells such fashion labels as Marc Jacobs and Zac Posen, is now also exhibiting and selling etchings by blue-chip artists, Francis Bacon and Francisco Clemente. As stated by one boutique owner, "In this economy, you have to be inventive". Such inventive strategies are a must to continue peaking the interests of the consumer and as experts continue to be pessimistic about the economy's future, the "boutique-as-gallery phenomenon" is expected to only become even more commonplace.
As an apparel retailing major it is important to know such strategies that are being used within retail stores to keep them afloat during a time of such economic crises. Having always had an interest in possibly owning my own boutique one day, this is of particular interest to me to see how small business owners of boutiques are managing to cut costs in order to ride out and even attempt to actually survive the economic slump. It is very interesting to me how boutique owners can use the work of artists to fill up spaces that they can no longer afford to fill with their own inventory; while at the same time the artist(s) is able to once again make some money after finding their works having lost their "homes" (galleries) and former source of income.
“Tradition dictated that art be displayed in a clean space on a white wall, with nothing around it,” said Linda Warren, a dealer in Chicago. To stray outside the confines of the white cube was, she said, to risk a “perception that the artist is selling out.” However, as the economy continues to take a nosedive, such tradition is going to the wayside. Many galleries have found themselves shutting their doors as they face mounting overhead and declining sales. With this, many galleries are being forced to close so exhibitions are becoming more popular in restaurants, hotels, and even condo lobbies. Yet, even more art is making its way into the world of fashion. As fashion boutique owners are finding themselves unable to continue fully filling their retail space with high-end designer labels, they are now filling the space with local artists works. For example, Confederacy, a hot retail spot in boho East Hollywood that sells such fashion labels as Marc Jacobs and Zac Posen, is now also exhibiting and selling etchings by blue-chip artists, Francis Bacon and Francisco Clemente. As stated by one boutique owner, "In this economy, you have to be inventive". Such inventive strategies are a must to continue peaking the interests of the consumer and as experts continue to be pessimistic about the economy's future, the "boutique-as-gallery phenomenon" is expected to only become even more commonplace.
As an apparel retailing major it is important to know such strategies that are being used within retail stores to keep them afloat during a time of such economic crises. Having always had an interest in possibly owning my own boutique one day, this is of particular interest to me to see how small business owners of boutiques are managing to cut costs in order to ride out and even attempt to actually survive the economic slump. It is very interesting to me how boutique owners can use the work of artists to fill up spaces that they can no longer afford to fill with their own inventory; while at the same time the artist(s) is able to once again make some money after finding their works having lost their "homes" (galleries) and former source of income.
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