The Two Major Factors Affect The Pattern Of Profit Margin In The Underwear Industry

There are two main factors affecting the profit margins of underwear industry.

First, cost driven inflation.

Various cost elements (such as raw material costs, land prices, labor costs, property costs, pportation costs, online and offline advertising costs) are all rising, squeezing the profit margins of garment enterprises; the other is that brand dealers are getting closer to consumers, and their design value or brand value is beginning to show. With the increase of consumer consumption level and brand awareness, consumers gradually recognize and accept these design values or brand values, so that brand owners get premium or brand premium, which improves the profitability of enterprises.

At the same time, the role of pure wholesale in circulation is getting lower and lower. Its front-end value has been cut down by the rigid cost rise of manufacturers, and the value of backend has been gradually segmented by brands or retailers, and the profit margin of enterprises has been getting lower and lower. Therefore, it has begun to develop towards retail terminals and control shop resources to improve profit margins.

There are two reasons for the fierce competition between wholesale markets and retailers: first, brand influence is expanding, and consumers' brand awareness is constantly increasing.

From the perspective of brand, its influence is expanding.

LV package costs hundreds of dollars, why sell tens of thousands, tens of thousands of price, consumers still buy it? This is the influence of LV brand, people buy is not only the package itself, but the LV brand.

In addition, a good brand means quality assurance, good reputation, perfect after-sales service, and even shopping environment. A higher level of understanding is to lead the trend, highlight the personal image, status and so on.

People pay more and more attention to it.