CRI听力: Chinese Garment Brands Restructuring

Some of China's most famous clothing brands are targeting new groups of customers by diversifying their product lines. But will the market recognize their attempt?

Let's take a closer look with reporter Liu Min:

Reporter:

At the China International Garment Exhibition, many well-known Chinese brands are displaying a new image. Li Ning, the renowned Chinese sports brand, has joined their new garment partner Paclantic to sell children's clothes. Lu Zhiyong is the vice president of the Children Garment Company Paclantic.

"In China the children's clothing market is worth a total of five billion yuan a year. We believe children's clothes under the brand of Li Ning will achieve huge sales. Plus we have a competitive advantage in terms of quality and price compared to those overseas brands."

According to the industry report, the children's garment market in China is growing by 20 percent annually. Other than Li Ning, some other domestic athletic brands like 361 Degrees and Anta have also launched child-focused sub-brands, exploring new markets outside the sports world. Vice president Lu Xiaohu from the sports company Erke says domestic sports brands have reached their sales limit when competing with foreign brands.

"Nike and Adidas have occupied more than 70 percent of the global market. Even though their share in the Chinese market is not that big, they still rank top here. It is still quite challenging for us to alter this situation. That's why the domestic companies need to think up a new way to compete."

At the same time as domestic sports brands adjust their product range, some well-known Chinese cashmere brands are taking similar steps. Now alongside their cashmere displays, some fashionable non-cashmere suits are receiving a lot of attention. President of the Snow Lotus Company Chen Tao says they target those with a high income and special taste.

"We've promoted high-end garments with stylish designs for these customers. It is a new brand attached to our original brand. Given the current market situation, many companies like us have decided to explore and cultivate a more specific group of consumers."

The impression Chinese customers have of these well-known brands is still related to traditional department stores and old-fashioned designs, which were welcomed by middle-aged and senior shoppers. But now they've moved into more modern territory on the catwalk, inviting world-renowned fashion designers into the fold.

Vice president of the China Garment Association, Xia Guoxin, says many domestic garment producers have adopted new development models.

"The chief brand is just like a protective umbrella to those sub-brands. When a brand becomes mature, and enters the international market, it is more likely to generate diversified product-lines. Such a business model can attach additional value to the brand itself."

But experts also say that adopting such a development model is a double-edged sword. It is both an opportunity and a challenge for domestic garment brands in their restructuring process. A successful sub-brand can glorify the original one, whilst a failed venture can damage it.

For China Drive, I'm Liu Min.