Although the retail model of outlets is very important, at that time, leading enterprises in the industry have begun to turn to selling clothes through department stores. 1995, PVH started a strategic restructuring plan and began to reduce the investment in outlet sales channels, hoping to reduce the number of retail stores and retail operating costs. By 1997, PVH closed 400 stores with the worst performance and opened 50 new stores to alleviate the problems caused by excessive expansion of outlets, and the number of retail outlets was reduced from 1000 to 650. Gradually, the retail industry of PVH has become a useful supplement to the wholesale industry.
While reducing the number of outlets in direct-sale stores and retail channels, PVH believes that the market awareness of products can be improved through wholesale channel marketing. For a long time, the company has established close wholesale customer relationships with large enterprises such as May Co, Federated, Dillard's, Profits and JCPenney. Wholesale customers of PVH footwear products include Nordstrom, May Co, Dillard's, Federated and Belk's. Whether it is the wholesale of clothing or footwear products, these big customers have cooperated with PVH for more than 25 years. As early as the end of last century, the top ten wholesale customers accounted for 60% of PVH's annual wholesale business.
In 2004/05, retail business once again became the focus of the company's sales management strategy. Displaying brands to a large number of buyers in the form of retail stores can expand the scope of traditional retail customers of products. In 2005, the sales environment of American outlet channels was quite healthy. Through effective promotion, customers can have a deeper understanding of product connotation and brand value. PVH continues to open Calvin Klein stores in American hypermarkets, and it is expected to reach 85-90 stores in 2008.
Today, in the outlet retail channel, PVH has made profits that exceed expectations. In order to reduce the competition among its own brands, PVH has established a broad customer base for all brands. The clothing product design of each brand is based on ensuring a stable customer base, rather than chasing the ever-changing fashion trend.
Expanding the product category of the brand is also one of the ways to strengthen the brand's appeal to the target customer base. PVH has been constantly improving its design and clothing production, with a view to broadening the brand's product categories and even breaking through brand restrictions, such as selling formal shirts in the name of Bath. Today, all the brands of PVH have achieved good results in their respective markets.
In a mature clothing industry, brand is an important way to distinguish product grades. At the end of last century, the five major brands of PVH were famous for their moderate prices and high quality. The company has been trying to enter the high-end fashion market, such as trying to push the Bass brand to a higher-end market, but this effort was not very effective at that time.
Now, from the analysis chart of PVH's internal brand pricing, we can see that PVH has successfully entered the high-end fashion field with Calvin Klein Collection, ck Calvin Klein Series and BCBG· max azria Series, thus establishing a brand price system from low to high.
Expanding brand influence has always been the direction of PVH's unremitting efforts. Since 1997, PVH has invested $37.8 million in advertising for the brand, and has helped the brand to enhance its market awareness and enhance its market competitiveness with a large amount of advertising investment.
In brand promotion, it has become the long-term goal of the company to establish the international image of the brand and develop the brand into an international franchise brand. Now, all the brands of PVH are sold all over the world, and many brands have gained a wide reputation in the world, such as Gant, Arrow, Calvin Klein and so on.
In addition to promoting its own brands internationally, PVH also uses its rich experience in mergers and acquisitions to purchase the management rights of some world-renowned brands to cooperate with the company's international marketing strategy. As early as 1995, PVH seized the opportunity to expand brand sales to the world. By acquiring a 25% stake in Pyramid, Pyramid is allowed to sell PVH Gant brand sportswear in 20 countries around the world.
Recently, PVH accepted an order to produce a series of leisure sportswear products for Timberland Company, and it is expected to start producing Timberland men's wear in 2008. It is said that Timberland clothing will bring 200 million dollars of growth opportunities to PVH in the next five years.
Meanwhile, PVH claims that the acquisition of Superba, a scarf and tie manufacturer, in the first half of 2007 will play a profitable role in the second half of 2007.
The increasing annual profit rate in 2005 and 2006 shows that PVH's brand appeal has gradually increased, and it has the ability of multi-brand operation, multi-channel sales management and multi-price setting. As early as the end of last century, American clothing industry has developed into a mature field, and people in the industry have already reached a consensus that reducing production costs has become a key factor to achieve income growth. Success in the field of clothing must include the following factors: low production cost, low-cost raw material procurement, product branding, strong management, global business development and flexible distribution system. PVH has rich experience in traditional clothing management, and has strengthened the control of production, raw material procurement and distribution.
By investing in IT software configuration, PVH successfully shortened the production cycle and effectively controlled the cost. As one of the few companies in the United States that can produce their own shirts, PVH initially owned some of its own factories and also produced them through third parties. Since 1995, PVH has been closing its own production line to improve operational efficiency. In order to continue to reduce costs, PVH cleaned up its distribution channels and storage equipment in the United States, and closed the sweater processing business. During the period from 1996 to 1998, the retail business of PVH decreased by 19.8%, the warehousing and dealer business decreased by 5.3%, and the processing business decreased by 8.4%.
The early successful cost control measures of PVH Company brought profit guarantee and risk avoidance for the company's later development. For American clothing and textile industry, 2005 was a year of canceling import quotas, which was full of challenges and turmoil. Enterprises in the retail industry have strengthened their market position through a large number of mergers and acquisitions. The American economy is still in an unstable state. The increase of interest rate and oil price has brought unstable factors, challenged consumers' confidence and affected consumers' consumption habits. However, due to foreseeing the increasingly competitive global environment, PVH maintained its growth in 2005. Today, PVH's official shirts continue to maintain a leading position in China, and are sold through Michael McGose, BCBG max azria, BCBG Attitude, Sean John, Chaps and Donald Trump (launched in 2005). With more and more licensing agreements signed by these brands, PVH has achieved more than 32% market share in the sales of formal shirts in department stores.
In the traditional business of formal shirts, PVH still implements several unique brands to face different market segments and use different sales channels. Good sales performance proves the correctness of these marketing strategies.
Especially in the middle of 2005, Van Heusen, PVH's largest brand of dress shirts, maintained its position as the champion in township sales, while Geoffrey Beene became the champion in the sales of designer dress shirts in department stores. Wrigley is still the sales champion of middle-priced channels, and its market penetration rate is constantly improving. At present, the above three brands represent three best-selling shirt brands with different price grades in the United States. In addition, the newly launched donald trump signature brand series, as well as the formal shirts of Chaps, Sean John, BCGB· max azria, BCBG· Attitude, Eagle and ck Calvin Klein with high annual output, provided impetus for PVH's so-called "slow growth business of formal shirts". Generally speaking, one third of the official shirts sold in the United States are produced by PVH.
Similarly, in order to establish an international foundation for formal shirt business, PVH has established direct sales outlets and marketing agencies in Europe and Canada. These measures enable the company to directly control the sales of Canadian official shirts of Van Heusen, Arrow, Geoffrey Beene, IZOD, Donald J. Trump Signature Collection and Calvin Klein, and directly participate in promoting the sales of ck Calvin Klein and Calvin Klein series of official shirts and ties in Europe. From 65438 to 0995, PVH has made outstanding achievements in the field of sportswear by acquiring existing brands (such as Gant and IZOD) and expanding its wholesale business.
Nowadays, relying on the massive sales of IZOD brand under international and domestic product licensing agreements, the entire PVH sportswear camp has achieved rapid growth, especially in 2004, which exceeded the company's expectations. In recent years, the global sales volume of IZOD brand has continued to grow, and its new products are particularly concerned by consumers, especially in the women's market, women's swimwear, underwear products and accessories have been added. After signing a license agreement with PG USA Sportswear, IZOD launched IZOD G Golf Men's and Women's Wear in 2005.
In 2004, Calvin Klein's men's better sportswear sales points increased from 264 to more than 500, and the sales of Volkswagen stores increased by one square meter. Consumers and retailers reacted strongly to several new sports series launched by Calvin Klein in May/June, 2004. It can be said that in this field, the profit margin brought by this brand has just begun to expand. In addition, during 2005-2006, the market share of PVH sportswear in high-end department stores and middle-priced sales channels is also increasing.