Transformation Of Enterprises: Magnificent Transformation Of Shanghai Silk Group

Many people are familiar with the rapid growth of women's clothing brand Lily in recent years. However, it is not known that it belongs to Shanghai silk group. From a traditional state-owned professional foreign trade company to a joint-stock enterprise with original brand, Silk group From a series of reform and transformation, it has become a model for the development of state-owned enterprises and a leader in the domestic garment industry.

Gradual transformation from OEM to originality

1949 China silk When the company was first established, there were few competitors in the industry, and now it is already a great force. Coupled with rising labor costs, insufficient external demand and tight cash flow, various factors have made foreign trade a "declining aristocracy", and it is becoming more and more difficult to survive in this industry. Stabilize the main business and stabilize China's largest clothing The status of export enterprises is the foundation for the development of the silk group.

Chairman Xu Weimin briefed reporters on the three steps. OEM (foundry production), commonly known as "OEM", is the most primitive and simplest way of operation; ODM (original design manufacturer), based on the OEM, added innovative design to improve the technological content. Because of the orderly coordination of the first two steps, the foreign trade business which still accounts for 80~90% of the group's annual sales can grow steadily. OBM is the most difficult and important third step, which is the core of the silk group's future development.

The lily brand, founded in 2000, made little profit in the first ten years, but when long patience was ready to wait for the right opportunity, Lily began to sprout up all over the country. 09 annual sales of 300 million, and then grow at an annual rate of 40~50%. Last year, its profits accounted for nearly 40% of the company's total profits. In addition to further expansion in China, lily also made full use of the group's internal advantages in foreign trade, and opened more than 40 franchises overseas in 07 years. "In the future, we will turn franchised stores into direct stores and re organize domestic and foreign resources, so that we can really enter the international market," Xu Weimin said.

Lily has gradually established a business style suitable for 25~35 year old women in the process of gradual exploration. The sales mode is between European Zara and Korean E-l. With the popularity of the brand increasing, the diversified development of its product line has also been planned in detail. The group has registered the 4 fonts of lily, and intends to produce 4 distinctive series when the brand is more powerful.

External innovation originates from internal mechanism.

If you want to occupy a place in today's times, you can't always follow others' thinking. You must innovate to become a transformator. The success of Lily can be classified as precise style positioning, fashionable dress design and differentiated sales channels. But where do these winning traits come from? Or behind the success of lily, what is dominant? Xu Weimin said, the key depends on people. Of course, people rely on mechanisms behind them.

In the lily management team, a large proportion of people are admitted to the company as a fresh student. They tend to have higher loyalty and enthusiasm for this first job. Xu Weimin repeated several times, "they are not just working but acting as a career." Cultivating a new brand is like raising a new life. Such a process is hard to experience in mature enterprises, and the growth of harvest is also more.

Marketization is another key. Lily has a team of 40 fashion designers, including several foreigners. Although in state-owned enterprises, employees' incomes are basically distributed according to market standards, attracting high-quality talents. For senior management, the group implements equity and post matching system to motivate. Even extended to the entire silk group, the average annual salary of all employees is much higher than the average level of Shanghai. Generous returns make people willing to work more vigorously, and businesses are active.

Without the reform of the system and mechanism, there will be no development. In 2003, the group was transformed into a joint-stock enterprise, and 51% was controlled by some 60 members of the board of directors. The other 49% were jointly controlled by 4 state-owned enterprises. "This is not a lot of 1%, so that I can do things freely." Xu Weimin said frankly, "one of the keys to the reform of state-owned enterprises is to make enterprises the main body of market competition". In the future, he expressed the hope that the silk group will become a world-class clothing supplier and brand player before 2020, and the ultimate goal is to become a world-class brand player one day.