Visions of clothes trade as a new ensemble

Founder of fashion company thinks those in the industry need to pull together

China's fashion companies have always been switched onto the world, so they do not need to go global, but they do need to draw on international resources to become more competitive at home, a fashion company leader says.

Xia Hua, founder of the Eve Group, is well known for dressing successful Chinese entrepreneurs such as Jack Ma and Liu Chuanzhi. She says fashion companies like Eve have faced competition from global brands such as Chanel from the day they were founded.

"We have taken part in many shows overseas, such as at the London Olympics," Xia says.

"But I don't think selling our wares overseas is the only way to go global. In fact, the Chinese market is huge, and working out how to use international resources to help us win the battle in China is the most important thing."

Even though Eve has no store in Europe it has worked with hundreds of suppliers overseas, and dozens of factories and companies in France and Italy are working with it, from companies that make fabric to those that make buttons.

Eve says it has more than 1,000 suppliers, of which about 700 are in China.

Xia also established Global Designer Space, a commercial entity aimed at attracting global designers, either in person or through the Internet, to provide service for Chinese brands and garments.

These designers come from industries other than fashion, including architecture, and Xia says their input will inject new vitality into the fashion business.

Many clothing companies in China have been in straitened financial circumstances in recent years because of rising costs for material and labor. But Eve, which was set up in 1994, says it has a turnover amounting to billions of yuan, although the company does not provide a specific number.

Eve Group has five brands whose prices range from several hundred yuan to more than 10,000 yuan ($1,600). It offers a made-to-measure service to about 1 million VIP customers, many of them business leaders like Xia herself. It has more than 500 shops nationwide.

Xia, who grew up in a rural family in Liaoning province, Northeast China, studied law at China University of Political Science and Law in Beijing and was a college lecturer for four years before founding Eve.

She was the first female member of the China Entrepreneur Club, which consists of 47 leaders of some of the country's top private companies. It has only two female members.

For a woman, making clothes for men is the perfect thing to do, she says.

"When a man wears clothes his mirror is a woman. There is no doubt he will care about what a woman says about his attire. Woman have acute taste, particularly with clothes, so I think that for me making men's clothes was a great decision."

Xia says that as someone who studied law and who spent four years as a college teacher, she possesses both logic and confidence in public. Once in a forum the club organized, Xia encouraged all the lecturers to stand up and speak to the audience instead of one another.

Xia says she has learned a great deal from club members, finding them to be decisive and direct.

"I think females have more roles in society than men, so there is no time to hesitate. We need to be more decisive, face facts and solve problems. At a particular time I may be there talking with them and thinking at the same pace, but later I will have to go home and think about how to be a good wife and mother."

By being with entrepreneurs, she says, she can see changes in many other industries, and it makes her worry how the fashion industry will develop, particularly given that the Internet age has greatly changed it.

It is important for companies in different parts of the industry chain to work together to make the whole industry grow in a healthy way, she says. In the industry every link, including manufacturers, brands and suppliers, works in a specific area, she says.

"All these businesses are preoccupied with their own issues. For example, as a brand company, we are always thinking about how to quickly communicate our brands in this Internet age, and how to make our brands sell better online. If I'm a manufacturer I may think about how to make products in this new age that will meet customer expectations or get international orders as soon as possible. As a franchisee company I will think about how to pick up a partner that can help us reduce inventory. So everyone is thinking about their own problems."

"But I would like to think more from a whole-industry perspective. The problem the industry has is that there is too much reliance on individual companies, rather than the industry chain as a whole, and this is keeping it back."

Xia says that with the Internet people can easily find out details about a particular shirt and who sells it at the lowest price. On Nov 11 last year, so-called Singles' Day, Alibaba businesses sold 57.1 billion yuan ($9.3 billion) of merchandise in the space of 24 hours, a large portion of it clothes. The whole industry should work in concert to change the way profits throughout the industry chain are distributed, and build a model by which manufacturers, suppliers, retailers and brands can share risks together and innovate together.

"People used to think that brand companies were those that made the most money. In fact, we are willing to share profits with manufacturers so we get good manufacturing companies and good brands. We need good up-stream suppliers. Down-stream retailers have had it tough over the past few years, and we would like to include them in this model. When they are all working together you will see the benefits."

Xia says the hardest part is integrating with manufacturers, because for them making money is difficult right now, and they usually want security. Once they have orders they feel secure, and feel they need not worry about inventory.

"So if you tell a manufacturer. 'I will give you more profit, but you need to shoulder risks with me together,' I think that unless they believe you will deliver them a much brighter future, they are going to think twice."

Over the past three years she has talked to many manufacturers and analyzed the pros and cons for them if they integrated.

In the Internet age companies need to change their way of thinking, she says. In the past they may have made products first and sold to the market, but now they really need to see what markets need first and then make the products accordingly.

Eve used to have a tailoring service at the beginning, that made clothes based on the customer's image and temperament. Moreover, she says, she would spend advertisement expenditure on clients.

"I thought it through 10 years ago: word-of-mouth communication is most effective. If you say you are good, consumers will always be skeptical, but if more and more successful people say your products are good, people will believe it."

Eve has also asked users to be involved in making its products. For example, in 2010 it brought in customers to design clothes for the company.

Chen Guoqiang, director of the Industry Economy Research Institute of the China National Garment Association, says the Internet makes information more transparent and timely, and factories and brands can get a lot closer to customers. That can transform the way a company designs, produces and sells.

chenyingqun@chinadaily.com.cn