How Did UNIQLO Achieve Almost Zero Inventory?

Ma Yun claimed that among his most admired entrepreneurs, Liu Chi, the founder of UNIQLO, and chairman of Japan Xun Marketing Co., Ltd., was "one of the biggest selling people in the world." "

The 83.72 day is Uniqlo The average inventory turnover time is faster than at least half of the domestic service companies. Even in China's most "remote" shops, the annual sales volume is over 20 million yuan, the flagship store is hundreds of millions of yuan, the average store sales amount is 30 million, and it is 10 times the same retail brand in China. A HEATTECH sold 120 million pieces in the autumn and winter of 2013, which is equivalent to the annual sales volume of all the domestic garment counterparts.

It is the ultimate dream of many retail enterprises that every product is sold and not backlog. A strong contrast is that inventory has become a chronic disease that restricts domestic garment enterprises. Beginning in 2012, from Lining, Anta, PEAK and other sporting goods enterprises to Metersbonwe, Semir and other youth leisure brands, and then to YOUNGOR, fir and other men's brands are deeply in stock crisis, and even the international giants such as Adidas have not been able to escape inventory problems.

How did UNIQLO achieve its "zero inventory" and make it not only for Metersbonwe, but also the enterprises from the new economic field?

We found that through the disruptive innovation in the links of R & D, design, production and sales, UNIQLO created a unique management mode, changing the "common sense" of the clothing industry, and constantly bringing more "unbelievable" into this traditional domain.

　　 Basic money first

Compared with ZARA, H&M and other popular fashion brands, UNIQLO's store has a distinct feeling that the former has fewer changeable elements and the style looks more streamlined.

　　 clothing In order to catch up with the fashion trend, enterprises attach importance to style and design. The general approach is to divide the market and locate the target market from which to design competitive styles.

This "common sense" was rejected by UNIQLO. It uses a completely different product development mode to enter all basic categories that can be worn by all ages and sexes.

With the experience of many years of clothing industry, general manager Shen Rui, general manager of Shanghai Rui Yong Enterprise Investment Co., Ltd. observed that "UNIQLO 70% is the basic fund, and its SKU is less than other clothing enterprises. The rate of error is relatively low, and the inventory pressure is very light." "

UNIQLO's SKU keeps around 1000, while the local casual wear business is basically 2000-5000. Learning the e-commerce brand of UNIQLO, the highest SKU reached 90 thousand, more than 30 warehouses.

More importantly, because the style is simple, the consumers are more comprehensive, rather than confined to certain groups of people, thus forming a larger market scale. "We are not luxury brands, and are easy to integrate into the general consumer life no matter brand level or design details. Pan Ning, chief executive of UNIQLO Greater China, said.

Another advantage of focusing on basic funds is to help UNIQLO to excavate standardized categories in the non standardized apparel industry, so that the terminal control standards can be duplicated easily and display integrated management in store image and product display.

It is worth noting that although the number of SKU is not large, UNIQLO has carried out in-depth development for each item, a single product, often divided into round collar, V collar, full coverage of men, women and children, especially in color embodiment, each SKU has four or five colors.

UNIQLO's many years of development is a "single product sales history":1998 wool jacket, 2001 moisture fast drying Polo shirt and T-shirt, 2003 cashmere sweater, 2008 HEATTECH series... Each star product has been accumulated for several years. From the initial idea to the superstar series, it has been continuously improved.

HEAT-TECH series, which created the miracle of sales, began R & D as early as 2002. At that time, there was a fabric similar to HEATTECH in Japan, which was made into sports underwear. It was sold only in sporting goods stores, and the price was very high. Although the material was thick and thick, it was overstaffed.

At this time, UNIQLO gets information from the sales line, consumers have strong purchase intention for underwear with cold proof and warm keeping function, but they are not satisfied with the existing material. In order to develop lightweight, soft and warm products for these customers, UNIQLO cooperated with Japanese textile giant Dongli company to overcome technological obstacles and quickly apply this professional fabric to public products.

Through continuous collection of customers' opinions and improvement of products, from the basic functions of cold prevention and warmth preservation to increasing anti-static function, the new season HEATTECH series of women's clothing and even the camellia oil of cosmetic raw materials has its moisturizing function. HEAT-TECH is exerting its utmost in the field of thermal clothing.

To change the fashion industry's focus on style and design, UNIQLO starts from the needs of customers, enhances the quality of products through developing fabrics, continuously improves product functions, and implements the "user experience supremacy" principle of the Internet industry unprecedentedly to the apparel industry.

"China's clothing industry is changing every year. The basic thing is not valued. The basic style is not really quality. All of them pursue personalization and pursue fashions, but rarely use their brains to find ways to do what consumers really want. "Cheng Weixiong, executive director of Yalu holdings, said. {page_break}

　　 Big data monitoring

Every spring is the peak season for clothing sales, but in 2012, Pan Ning found that sales figures still did not appear to rise in anticipation until April. After comparing the data with that of the same period last year, Pan Ning thought that the big events were not good enough, regardless of his colleagues' objection, he immediately offered promotional discounts for the new ones.

UNIQLO's tracking of sales data is weekly, and sales figures also reflect inventory changes in real time. So, after two weeks on the shelves, sales are basically at a glance. "Many enterprises are worried about inventory problems, but UNIQLO is not" entangled ", and we can always be from the whole store to each product sales data obtained support is inseparable, the number can explain everything. "Pan Ning said. Data analysis ability helps UNIQLO to control inventory timely and adjust to avoid crisis.

2012, it is the inventory crisis year of China's clothing industry, and the major clothing brands have broken out. The semi annual report showed that the stock of sports and leisure brands such as Lining and Anta grew year-on-year, and the stock of XTEP reached 887 million yuan, up by 92% compared with the same period last year. The inventory of the youth leisure brands such as the United States, Semir and so on also frequently amounted to 1. 2 billion yuan; the total inventory of the nine men's clothing listed companies including the seven wolves and the nine herding kings amounted to 3 billion 862 million yuan. In order to cope with the crisis, the major brands have taken measures such as price war, promotion war, goods rejection and closing stores, while UNIQLO completed the inventory disposal six months ago.

UNIQLO employees start from the first day of the company to observe numbers, understand figures, feel the changes in numbers, and create numbers.

Over the past 20 years, UNIQLO has formed a huge database by collecting all the sales data of every day, every color, every yard and every shop. Through real-time monitoring and analysis of sales data, to formulate production volume and adjust the marketing plan, UNIQLO finally basically achieved zero inventory.

In 2014, the cold winter continued, UNIQLO decided to speed up the whole plan, plans to open 80-100 new stores every year, an increase of 30% over the same period, which still relies on data support.

UNIQLO established Tmall flagship store in 2009, which is different from other brands in Jingdong, Dangdang and other platforms. The official website of UNIQLO and the traffic on APP are all directed to Tmall flagship store. At the same time, we analyze who buys, the amount of consumption and the frequency of consumption in the background. We can use these data to guide the new store in China. "Our products have been sold to 661 cities across the country, but our physical stores only enter more than 50 cities, and online stores can help us expand our customers' scope. "Pan Ning said. "Store accuracy is high, which is the advantage of big data. "Zhang Bingliang, general manager of Shanghai lion Consulting Co., Ltd. believes that the accurate rate of opening shop also enables UNIQLO to avoid maximum inventory loss.

Most domestic garment enterprises are lagging behind in terms of digital analysis capability. "How many products are sold every day, what is the replenishment situation, and which good sales are not good sales, so the domestic counterparts can see that the data a month ago are good. "Cheng Weixiong said.

Is management difficult or backward? "Everyone has hardware, but rarely sum up what happened in the store. Before the business was done well, we didn't pay much attention to this thing. Why should it be so small and so annoying? The second year product plan was pat on the head instead of making decisions based on data analysis. "Zhang Bingliang said.

Shen Jun also thinks that the reason lies in management. "Technology is only supplementary. Many brands can do it. The key is whether you can insist that the data collected are really used to analyze and make decisions. "{page_break}

　　 What happened in the shop

In addition to data management, UNIQLO can control the real and effective information at the first time. Pan Ning believes that the more essential reason is its direct store mode. "Doing direct business is very hard, but it can quickly win more direct market reaction." "

Many fashion brands adopt the franchise mode at the retail end, which is very different in information control ability. Inventory problem is a concentrated reflection.

"Joining can bring huge cash flow and deep channels to facilitate the rapid expansion of enterprises, but the information collection link has a fault. It is impossible to control the real data of consumer terminals and know what consumers want. Many garment enterprises actually have not yet entered the retail market, they are wholesale, do not understand the first tier market dynamic sales information, goods are pressed to the dealer there, only to create such a large inventory. "Zhang Bingliang analysis.

The first time to grasp what is happening in the store is particularly important in the "fast fashion" industry. Seasonal changes and fashion changes lead to rapid changes in clothing demand, making quick decisions on front-line sales, often holding the business opportunities that are fleeting.

Different from many retail On the contrary, in the UNIQLO, "shops are the driving force behind the development of headquarters." "Penning said," UNIQLO's business philosophy has one, goods and shops is our only contact with customers, shops are the only place to create profits. "

The information obtained in the store will be regularly returned to the headquarters, sometimes for a particular commodity, and sometimes for the whole service. "Staff at headquarters can not collect such information themselves, they must be done through shop assistants and store managers. "Pan Ning said.

Attending Monday and Tuesday's convention is the most important task for Pan Ning and all the senior and middle managers to discuss what is happening in the shop.

The problems arising from the sales process are collected from the store manager, and then discussed in accordance with the order, commodities, marketing, stores and services. The ideas, puzzles and proposals of the store owners will be discussed at the meeting, such as whether the business is good or bad, why the industry fails to meet the standards, how to meet the standards, what the good products are and what the bad products are. All kinds of work, no matter how big or trivial.

Finally, the conference must come up with a consistent solution, and then feedback to the shops.

"The clerk knows how to do the meeting record, how to adjust the layout of the shop, how to configure the goods and make promotion strategies. From the point of view of management, information is very transparent and open, and the interaction between both sides is very fast. "Pan Ning said.

How fast is UNIQLO? An example is that whenever a store has unsalable goods, the store manager will ask the headquarters to apply for a price change. The proposal will receive feedback in the afternoon, and the sale price will be sold in second days.

Frontline staff's advice often leads to the production of new best sellers. In the autumn of 2010, after the listing of men's wool coat, the staff of Chinese stores found that S sold out after a week of listing, and the buyers were female customers. This information was sent back to headquarters. Soon, the women's fur coat was quickly produced and put on shelves.

The popular products of UNIQLO are made according to the reaction of shoppers to customers and the opinions of shopkeeper. After the commercialization of finished products, it improved in response to the actual market reaction in the past second years, and remained the same in third years. {page_break}

　　 Super Store Manager

On the way of management and control, Ryui Masa completely denied the traditional chain store mode of "headquarters decision, branch obedience". The shopkeeper of UNIQLO is given great power. He can decide and adjust the order quantity according to the location and source of the store. He can also make his own decisions based on the display of goods, the way of store operation and the contents of advertising leaflets.

Store leader led UNIQLO to control the goods from bottom to top, in response to the current market reaction, rather than from top to bottom, according to the analysis of past sales and fashion trends to determine the style and order quantity, and the latter will easily lead to inventory problems once there is a miscarriage of justice.

"The management and control means of domestic retail enterprises are more administrative instructions, the boss is the decision-maker, and UNIQLO is bottom-up, and the real controller and decision-maker of each store is the store manager. "Cheng Weixiong said. "The shop manager is the operator. That's how we look at them. We also educate them. "Pan Ning said. UNIQLO is not a simple store manager, but a knowledge-based manager who can think and act independently. He also wants to broaden his horizons, like challenges, and dare to manage his stores in his own way of thinking.

Being a super store manager is not only twice as good as ordinary employees, but also has greater autonomy and rising channels. In 2014, UNIQLO plans to recruit 470 college graduates as reserve managers, who are likely to become the shopkeeper of a store. Pan Ning will give them face-to-face training. For them, Pan Ning's successful experience is undoubtedly the most example.

What is the future of constantly folding clothes and calling "welcome" every day? In 1994, Pan Ning, who had just entered UNIQLO internship, thought so. At that time, UNIQLO was still a "township enterprise" located in Yamaguchi Prefecture, Japan, and its sales volume was less than 1/3 of the mainland market now. The interview with Pan Ning was the founder of UNIQLO, and now Japan's first Fuanagi Izhen.

After half a year's stacking, Pan Ningsheng was the store manager. One year after joining UNIQLO, Pan Ning received a master's degree in business from Nihon University. He formally entered the Xun marketing group and began to intervene in various aspects of supply chain building, market development, acquisition and merger. When he joined UNIQLO for 10 years, he was appointed president of Greater China and managed the mainland, Hongkong and Taiwan markets.

In UNIQLO, more than 95% of shop assistants were trained and selected from shop assistants. "Generally speaking, the growth rate of talent is about half a year, while the average talent is one and a half years. "Pan Ning said. There are 16 thousand employees in UNIQLO China, but Pan Ning has to attend the meeting of managers in each month.

"Many grassroots employees have rarely seen the boss for many years after they enter the company, but we are actively contacting them. "Pan Ning said. Every week in Southern China, southwest, East China and North China, there are interviews for new people in four districts. Penning will take turns. This enables the store manager to see penning at least once every two months. "Diligence is the biggest influence that Liu well is giving me. "Pan Ning said.

In the public occasions or forums that the big guys love to gather, they rarely see the figure of the Chinese trader in UNIQLO, like Pan Ning, Liu Xiao Jing, who is recruiting and training employees in half of their working hours.

"Once employees enter the company, they will be deeply instilled into UNIQLO's business philosophy and corporate culture. Our training for employees varies from person to person, and then we plan to help them grow. Throw people in the shop every day, let you fold clothes and fold clothes, so that you can clean up, so that no talent will be cultivated. "

In the labor intensive clothing industry, the high turnover rate of the front-line staff is one of the important factors that affect the management cost and management efficiency of the enterprises, especially the excellent shop manager level managers. "Compared with the domestic apparel retail enterprises, the staff turnover rate of UNIQLO is relatively low, the store manager level is more stable, its incentive mechanism and training mechanism are in place, and the internal organizational system and hematopoietic function are very strong. "Cheng Weixiong said.