Brand Economic Research For The Development Of China's Apparel Industry

As one of the support industries of China's economics,apparel industry has played an important role in China's economic developing since the foundation of the country,especially after the Reforming and opening to the outside world.Every year,beside satisfying the apparel-demand of more the one fifth of the earth's population,China's apparel industry supplies a great deal of apparel products to the world market,and has earned trillions of foreign money to support the other departments of the nation's economic system.At the same time,with the changes of the economic situation,China's apparel industry faces serious developing challenge.The industry's fast developing in the past decades owning to the low cost obtaining from the cheap and easy-getting labor force,and the low cost becomes this industry's way to get profit.But now, this low-cost-advantage is threaten by the unfavorable factors such as the rise of exchange rate of RMB,the abatement of the drawback on tariff,and the exclusion against Apparel products made in China from some countries.How to find something to stop the decline of China's apparel industry is a serious problem to deal with.This dissertation shows that to build up Category-level brand of Apparel is the key to change the profit-earning mode and promote the whole industry's further development.Aiming at settling the problem mentioned above,this dissertation summarizes those theories that through a light on that problem in first place.Advantage theory is one of the theories that have been depended on when the researchers considering China's apparel industry.Actually,advantage theory really plays an important role in the developing of China's apparel industry.According to the comparative advantage theory and competitive advantage theory,China's economy has developed labor-intensive industries such as apparel industry,and really got benefit from such behavior.But when the low-labor-cost advantage disappears by and by,how to sustain China's apparel industry to go on? Put in another way to say,how to cultivate another advantage to sustain the industry's development? This advantage theory does not give any clue of it.The Industrial-Economics-theory is another theory used often when inner-scholars do researches about apparel industry,especially the industrial-cluster theory of this theory really gives guidance to that industry's development.Actually, there are many provinces in China have many apparel industrial clusters of different kinds of products,and such cluster's promotion of development of the industry is visible.But this promotion still represents as lower cost:the promotion of skill-development is not distinct.Also this theory does not give the answer of how to develop a new advantage after the old one disappears.Theory of value chain and supply chain,one part of the industry economics theory,shows some researches on how an apparel enterprise can upgrade along the value chain and how the profit distributes along the value chain.But Gereffi's demonstration research shows that through the upgrading on the value chain the productive enterprise can not be better off,because the enterprise can not get more profit from OBM than form OEM.Explanation for the phenomenon in this dissertation is that the enterprises' understanding of brand is not enough to help them to build brands "strong" enough to do good.So,to understand what is really a brand and hot can build a success brand to make the enterprise's profit-earning mode change better? This value chain theory does not answer these questions.Differentiation theory in industrial-economics theory shows that through product-differentiation the enterprise can get some control on the price.But how can consumers get that information of the differentiation characters of the products and make the consumers to buy those products? This theory does not show the answer.In this dissertation,the opinion is that the differentiation information of the product is passing to consumers by the product's brand,so the brand plays an important role.But in differentiation theory,brand is only a factor supposed to be fixed and will not affect the price and sale-volume of the product.So,in differentiation theory,there is no part to do with how the brand functions to transfer information about products. As summarized above,all those existing theories concerning about the developing of China's apparel-industry has no clue of settling the problem mentioned at the beginning of this abstract.We can see that the key of fulfilled all these theories' blankness on settling this problem is brand.Brand is the key to realize the change of profit-earning-mode in the enterprise's upgrading process, and also it is the key to let the consumers receive and choose products of differentiation.So,the research on apparel brand is the key to settle the problem.The next step we focus on the existing researches on brand.Most of them are on the bases from management aspect,there is few from research form aspect of economics.In this dissertation,the most helpful theory to do with the subject is Brand Theory developed by Sun yueyao and Liu huajun.Concerning with the situation of China's apparel industry and on the bases of Sun and Liu's theory,this dissertation will do some research on the industry's problem and give some advice about it.So,the research of this dissertation will begin with the developing problem of China's apparel industry,taking the changing of enterprise's profit-earning-mode as goal,and put forward the viewpoint that by the way of building up category-level apparel brand,the enterprises of apparel change their profit-earning mode,and promote the whole industry's development.In the first place,this dissertation uses economics tools to analyze how brands work on consumers and producer's utilities to explain why to build up category-level brand can help apparel enterprises to change their profit-earning mode.From the aspect of consumers,this dissertation analyzes factors that affect consumers' choice behavior when they choose apparel products.When consumers want to buy some apparel product,there are many factors have to be considered, such as material,style,size,etc..So,it is a tough procedure to choose apparel products.Besides,because the apparel market is a buyer's market now,the supply of apparel products is enormous,the information of product-suppliers, supplied-products and the comparison-information of different products will be much more enormous either.So to make a choice of apparel-products is harder to consumers,and it will take a lot of times or spend a big sum of choice cost.What the apparel brand can do is to lower that choice cost.By building up the single benefit point(SBP) with consumers,apparel brand can simplify the choice procedure and lower the choice cost.The single benefit point means that the apparel brand promise to be a certain category of apparel product and keep to fulfill that promise.The biggest utility consumers can get from apparel brand is that by choosing SBP consumers can lower choice cost.For apparel enterprises,purpose of building up brand is to maximize their profits.Ling in different kinds of value chains,producing-enterprises can only get very little percentage of profit if they receive producing contracts and have no brand of their own.Most of the value-added is shared by the circulating joints. Only by building up their own brands,can those enterprises get much more percentage of the profits.These do not mean that as long as enterprises build up brands could they get more profits.A brand will pass three steps before it becomes a mature brand.At different steps,the brand has different effects.When at the beginning step,it is just a trademark and can not affect the owner's sale and profit. But when it becomes a mature brand with correct product-position and brand strategies,the brand-pulling-power of the brand will become larger and larger,and the producer can get more percentage of profit in the value chain.But,what kind of apparel brand can have such brand-pulling-power?The viewpoint of this dissertation is that,a brand positioned oppositely against those in-position-already will have more chance to succeed than a brand positioned following those in-position-already.A brand positioned oppositely against those in position already can reduce consumers' choice cost;sometimes it can even make the choice cost reduce to zero.So this kind of brand position can attract consumers' choice efficiently,and helps producer to realize sale and profit.When examining the development of apparel industry and apparel-brand,we can find that except for France,who first entered the world apparel market and occupied the high-level products market,any enterprises of different countries want to enter the world apparel market will success if they take the opposite position against brands in-position-already,and just struggle to survive if they take the following position with brand in-position-already.So,it is the best way to build an apparel-brand in a buyer's-market to build up a category-level brand oppositely positioned.Brand strategy is also an important part for a successful brand. One-category—one-brand strategy can keep a brand stay on a higher level brand-category-degree,so that consumers' choice cost can be reduced to a low level even to zero.Broadcast strategy,information strategy,enterprise civilization strategy,circumstance reciprocity strategy,strategy-evaluating and promoting strategy(developing strategy)are important strategies in masses broadcast, enterprises reacting and information reflection,enterprises civilization,enterprises and circumstance relations.Advantage-brand-driving strategy will do go good to enterprises and the whole apparel industry's development.