LONDON — American fashion companies may be nervous about the growing trade war between the U.S. and China, while Western brands continue to target Chinese consumers as the world’s largest buyers of luxury goods.
But in China itself, while Western brands dominate in terms of accessories and beauty, Chinese companies actually top the market when it comes to fashion. And these brands are increasingly turning the phrase “Made in China” into an asset.
This is all part of the Chinese government’s goal of moving the company’s manufacturers up the value chain.
In 2015, China’s Prime Minister Li Keqiang launched the Made in China initiative, known as MIC 2025, which seeks to modernize the country’s industrial capabilities. The country sees MIC 2025 as a chance to integrate itself into the global manufacturing chain and more effectively cooperate with industrialized economies.
The outcome has been fruitful. Walking around premium Shanghai shopping malls, it’s apparent how Chinese brands lead when it comes to fashion and the local consumer. Last year, during Tmall Singles’ Day’s shopping festival — an indicator of the retail climate — seven out of the 10 best-selling women’s wear and men’s wear brands were Chinese.
Andrew Hou, manufacturing general manager of Icicle, the Shanghai-based high-end fashion brand with a focus on dressing businesswomen, said the Chinese luxury market is set to embark on a new era, one that will see “Made in China” compete on equal ground to “Made in Italy” and “Made in France.” Icicle is the same company that snatched Carven out of bankruptcy last year.
“As the government seeks to move the country up the global value chain, the Thirteenth Five-Year Plan (2016-20), a series of social and economic development initiatives issued by the Communist Party of China, requires China’s economic orientation to shift from low-end production to higher-end and creative industries,” he said.
Jane Wang, the heir to the Erdos conglomerate, the world’s largest cashmere manufacturer, said because of Chinese manufacturing, “the country has flourished and accumulated a large amount of foreign exchange reserves since the implementation of the Reform and Open policy in 1979. It has allowed us to accumulate experience in international exchanges, cultivate talents, develop technology and lay a solid foundation for the development of Chinese brands, creating possibilities for China’s manufacturing industry to lead the world.”
Here, 12 leading Chinese fashion companies and designer brands with total sales of 45 billion renminbi, or $6.71 billion, last year at all levels of the market, talk to WWD about the role Made in China has played in their businesses.
Erdos: China’s finest cashmere maker.
Jane Wang, vice president and executive director of Erdos Holding Group and general manager of Erdos Cashmere Group.
Headquarters: Ordos, Inner Mongolia Autonomous Region
Market capitalization: 12.9 billion renminbi, or $1.92 billion
Revenue: 23.8 billion renminbi, or $3.55 billion in 2018
Brand portfolio: Erdos (main line), Erdos 1980 (essential line) Blue Erdos (affordable line), 1436 (luxury line), Erdos Kids (kids’ wear)
Erdos Cashmere Group is a subsidiary of Erdos Group, which has interests in energy and metallurgy as well as cashmere. The company produces one-third of the world’s cashmere and had more than 1,330 stores across China as of March 2019.
“Over the course of nearly 40 years of development, Erdos has always been proud of being a Chinese domestic brand and of the idea of Made in China. It is both a responsibility and an obligation,” said Jane Wang, chairman of the company.
“At the beginning, our factory provided cashmere raw materials, or OEM service, for some internationally renowned brands. When our products were labeled with those brands, the price increased by dozens — or even hundreds — of times, which makes us more determined to build China’s own brands.
“Almost all of the cashmere products are produced in Inner Mongolia. Our supply chain is vertically integrated. We have taken a series of measures to establish a cashmere management and production system for the entire industry chain, to maintain our standard and practice sustainable development,” she added. “For example, we protect high-quality breeding goats and scientifically breed Alpas goats in the Otog area in Inner Mongolia to ensure the quality of cashmere. We also became the associate partner of Global Fashion Agenda in 2019, as its first partner in mainland China. We are committed to working with sustainable companies around the world to transform the way the fashion industry operates.”
At the product level, the company cooperates with manufacturers to source the best fabrics, designs and craftsmanship. For example, the Erdo brand’s latest collection features Indian embroidered shawls, handmade by local artists, and Nepalese hand-embroidered capes.
Wang believes China’s younger generation is becoming the backbone of the consumer market, and the Made in China label will only benefit from that. “Made in China has become something very different in the eyes of consumers, which is a very good phenomenon,” she said.
Peacebird: Affordable fashion powerhouse.
Jiangping Zhang, founder and chairman
Headquarters: Ningbo, Zhejiang Province
Market capitalization: 8.82 billion renminbi, or $1.31 billion
Revenue: 7.71 billion renminbi, or $1.15 billion in 2018
Net profit: 576 million renminbi, or $85.26 million in 2018
Brand portfolio: Peacebird (men’s wear, women’s wear and homeware), Ledin (teen wear), Material Girl (streetwear), Mini Peace (kids’ wear)
With brand-image upgrades and global fashion initiatives in recent years, Peacebird operates more than 4,500 stores across China and its 2018 revenues of $1.15 billion were up 7.8 percent year-over-year.
To Jiangping Zhang, founder of the Ningbo-based company, the idea of Made in China means “designed in China” and “youth in China,” which are all valuable to the company, he said.
Zhang said Peacebird’s success wouldn’t be possible without the light-asset business model. The company keeps branding, design and distribution in house, while outsourcing its production to suppliers across China and beyond.
As the company grows and in response to the fast-changing demand and shift in taste, Peacebird has begun to build its own manufacturing system to speed design-to-product cycle.
“Chinese consumers don’t simply give feedback on the production and manufacturing. They are a part of the content creation of the brand. We have been pushing big on youth culture in recent years and aiming to become the preferred brand to the new generation of Chinese fashion consumers,” said Zhang.
Ribo: Embrace global creativity
Weidong Wang, chairman and president
Market capitalization: 2.39 billion renminbi, or $356 million
Revenue: 1.13 billion renminbi, or $170 million in 2018
Brand portfolio: Broadcast, Personal Point, Muchell, Taoray Wang, Sirloin,CRZ, R130 showroom
Ribo is a publicly traded fashion company based in Shanghai that operates more than 1,100 stores across China, and supports Taoray Wang’s New York presence. It expanded into the showroom business this season with the R130 Showroom, which features such designer brands as Asai, Marie Yat, Marta Jakubowski, Minju Kim, Ovelia Transtoto, Reike Nen and Sirloin as a part of its ambition to incubate the next generation of fashion talents with production support and China market access.
Such ambition is built on the back of Chinese production. “Ribo has full confidence in the future of Made in China. It will be just as good, if not better than Made in Japan and Made in Germany,” boasted Weidong Wang, who founded Ribo in the basement of Guangzhou University in 1997.
Wang believes Made in China has gradually gained recognition on the global stage. “Forty years of implementing China’s reform and open policy has already integrated China into every corner of the world. Although there are some voices of trade protection and counter-globalization, it is uneconomical and illogical to overthrow and rebuild the current system,” he said. With the upgrade of China’s manufacturing industry, Made in China is no longer the synonym for cheap and low quality.
Most of Ribo’s garment production is carried out in China’s Yangtze River Delta and the Pearl River Delta area, where the most advanced specialized labor and factories are based.
In recent years, however, Wang has moved some of the production to Yudu, a county under the administration of the city Ganzhou in Jiangxi Province. The company is investing more than 1 billion renminbi to build a smart manufacturing and research and development center there, as the local government offers incentives and it is easy to attract skilled works from the Pearl River Delta area since living costs are lower.
EPO Fashion Group: Chic and sustainable
Jenny Kim, founder and chief creative officer
Revenue: 11.9 billion renminbi, or $1.77 billion by 2022 (estimated)
Brand portfolio: Mo&Co (women’s wear), Edition (premium women’s wear), Common Gender (men’s wear), Little Mo & Co (kids’ wear), Rec (Cosmetics)
Founded in 2004, EPO Fashion Group owns five brands and operates more than 1,000 stores globally, including 12 units in Hong Kong and one store in Paris and London, respectively.
Jenny Kim, the founder, said garment manufacturing factories are raising the bar high for Made in China. “China’s high-end manufacturing power is very strong nowadays. They are constantly improving through professional equipment, information technology and specialized techniques, to enhance their product quality and production competitive.”
The transformation of Made in China is bringing better development to the entire fashion industry. “Strong and sustainable Made in China” has far-reaching significance for the brands of EPO Fashion Group, Kim said.
“We are rooted in China. China’s manufacturing capabilities can fully meet our high-end manufacturing needs. We are willing to work with these factories to build our supply chain and guarantee our quality,” she said.
The company sources material worldwide: High-quality silk, satin, jersey and knitwear from China; cotton, linen and lace from America and Europe; high-tech functional material from Japan, and Merino wool from Australia.
“We want to be as environmentally friendly as possible at the manufacturing and raw materials level. This is our long-term mission. We prefer to choose natural, organic, and upcycled materials, such as organic cotton and recycled fiber. We hope that through this, we will gradually influence the upstream supply chain and act as a member of the industry to jointly promote the upgrading and sustainable development of China’s garment industry,” said Kim.
Initial: Brand-building through experience and crossover
Eric Fong, founder and chairman
Headquarters: Hong Kong and Shanghai
Revenue: More than 1 billion renminbi, or $149 million in 2018 (estimated)
Brand portfolio: Initial Fashion, Initial Gentleman, Initial F&B (Ice Cream & Juice, Restaurant), Initial Life Attitude (homeware), Initial Atelier (interior design)
Founded in 2000, the Hong Kong-based Initial is a pioneer in experiential retail. The faint aroma of peach and delightful music in the background, along with personalized styling services, brought Chinese consumers a fresh perspective when traditional department stores dominated the market.
The company has since set up its mainland headquarters in Shanghai and opened 120 stores across 35 cities, duplicating the experience for a wider audience, while running 25 stores in Hong Kong.
Eric Fong, founder of the company, said Made in China is irreplaceable at this stage. “As more and more Chinese brands go into the international market, especially in the fashion industry, ‘Made in China’ has become a synonym with high standard manufacturing. I am proud of the idea, but I am not overly obsessed with our Chinese identity, as I am constantly learning and exploring the global culture and fashion trends,” he said.
In the past two years, the company has been doing lots of crossover projects with talents from the art and music industries to attract and stimulate niche communities and enhance the competitive strength of the brand. These also affect the brand’s style and aesthetic.
Fong pointed out that brands need to maintain a sense of crisis and think about how to remain competitive with globalization. “Chinese consumers are more meticulous and sensible about global brands and local brands. They pay more attention to the price/performance ratio of products, rather than from which countries, so we must first improve our internal strength and enhance brand value instead of putting the cart before the horse.”
Initial’s factories are in the southern and eastern part of China. “We work with the most sophisticated and quality-assured factories for different categories.” He also said they won’t move their manufacturing outside of China, but have plans to bring the brand to other countries.
Icicle: An empire built on value chain
Andrew Hou, manufacturing general manager
Annual revenue: 1.96 billion renminbi, or $292 million in 2018, up 22 percent.
Brand portfolio: Icicle, Carven
The Shanghai-based Icicle focuses on premium clothing for career-driven consumers with an emphasis on high-quality fabrics and an ecological bent. It operates more than 260 stores in China and plans to open a Paris flagship this September.
The company made headlines last year when it acquired the French fashion brand Carven. Industry sources expressed concern that Icicle could turn Carven into a brand like Sandro or Maje. An Icicle spokesman declined to reveal Carven’s strategy under new management, but confirmed: “That’s simply not what we want with Carven.”
Icicle is a firm believer in the idea of Made in China, or Made in Shanghai in particular. “It presents an indispensable competitive advantage for Icicle in the light of the corporate operational strategy,” said Andrew Hou, manufacturing general manager of Icicle.
Utilizing a global supply chain, the company designs products in Paris and Shanghai, and assembles them in China with fabrics supplied by European, Japanese and Chinese mills.
“Made in China is irreplaceable for us,” Hou said. “The geographic advantage enables the close follow-up of each stage of the production process to ensure product quality along every aspect of the manufacturing [process]. Communication also plays an essential role in ensuring the high visibility of the production process.”
He added: “The relatively close ties between design and manufacturing help shorten the time from studio to market, which means agility when responding to market needs.”
Icicle’s apparel products are made mainly at three manufacturing facilities owned by the group — two in Shanghai and one in Haimen, Jiangsu Province. The Haimen factory mainly produces Icicle’s women’s wear collection and Paris collection; the Minhang factory in Shanghai concentrates on men’s wear, while the Songjiang factory in Shanghai focuses on women’s wear.
“Our manufacturing facilities originated respectively from a Korean, Japanese and Chinese management background with their particular know-how for different products categories, with the legacy of over 20 years of high-end manufacture. For example, the Haimen factory has the most skilled craftsmen, making it the major production base of hand-made double-faced wool coats,” said Hou.
The only thing that’s made outside China is shoes. “Part of the shoe collection is manufactured in Italy, because of the specific industrial know-how and premium quality standards,” he said.
“Traditionally, the manufacturing location does have an impact on the consumers’ perception of the brand image. We have been working hard to overcome the problem of ‘low Chinese CoM — Country of Manufacturing image’ by demonstrating the handmade manufacturing process with industrialized artisanship.”
Aimer: Tech and culture
Yan Yang, vice president
Market capitalization: Not available
Annual revenue: Not available
Brand portfolio: Aimer (women’s and men’s underwear, homeware, kids’ wear, sportswear); Modelab (women’s underwear); La Clover (premium underwear); Body Wild (men’s underwear); Imi’s (women’s underwear); Shinelove (women’s underwear); Emperorient (homeware); Um25 (men’s underwear); Bechic (premium underwear), and Nature’s Gift (skin care).
Stores: More than 2,400
One of China’s largest underwear makers and employing more than 10,000 people, the Beijing-based Aimer is the Chinese equivalent of Victoria’s Secret that you have never heard of.
To Yan Yang, vice president of Aimer, the idea of Made in China is not only reflected in the geographical aspect, but in the cultural and human sides as well, given the intimate nature of the company’s products.
“For us, Made in China represents professional manufacturing, safety and fashion. Our research and development department has always been following the concept ‘create the integrated product that embodies technology, culture, creativity and health,’ and commits to developing the underwear that is truly suitable for consumers,” he said.
“In return, more and more consumers understand the brand value and corporate culture through the high-quality products. We manage to build a reliable relationship with consumers, because we understand their real needs and problems.”
Ninety-five percent of the products are manufactured in its factories in Shunyi, a suburb district of Beijing, and Suzhou in Jiangsu Province, while its skin-care line is made in New Zealand.
Yang said the company built the factories like tourist destinations. The Suzhou factory highlights its eco-friendly design, while the Shunyi one is more modern and sleeker with a touch of art and fashion.
“We always adhere to high-end manufacturing and incorporate sustainable concepts such as energy-saving, consumption reduction, ecological production process. In recent years, Aimer has strengthened intelligent manufacturing, launched a C2M customization laboratory and intelligent production workshop and created a rapid response model for underwear customization,” Yang said.
Vi-Ein: Original design with a Nordic touch.
Andy Ma, chairman
Revenue: More than 1 billion renminbi, or $149 million in 2018 (estimated)
Brand portfolio: EIN, Pure Tea, Plain People, Renli Su and Rotur studio.
The Shenzhen-based Vi-Ein, founded in 2009, operates more than 300 stores in 110 cities in China. Its flagship brand EIN is greatly inspired by Scandinavian aesthetics. Local press would describe the company’s labels as “forest girl brands,” a term that originated in Japan in the late Aughts to describe a consumer who prefers natural, simple and loosely fitted designs as if they are living in nature.
Andy Ma, chairman of Vi-Ein and husband of founder Elaine Ye, describes the company “as one of the pioneers of original designer brands in China.”
Even though inspiration can be drawn from anywhere in the world, Made in China cannot be overlooked. “Any creative plan, design sketch is just a piece of paper without the support of the manufacturing industry, especially in the fashion industry. Chinese manufacturing is indispensable and irreplaceable,” he said.
“We seek fabrics and technique all over the world, such as Chinese native silk, Japanese cotton, Italian wool, Korean blends, but all the production is completed in China,” said Ma. Also, Renli Su, a London-based Chinese designer brand Vi-Ein invested in a few years ago, is benefiting from their supply chain system in Shenzhen.
Le Fame: Banking on the revival of romanticism
Manxiu Wang, general manager
Annual revenue: 150 million renminbi, or $22.36 million in 2018
Founded in a mansion in Shanghai’s former French colony in 2015, Le Fame targets the rising middle class who appreciate the brand’s combination of East and West, and the revival of exuberant romanticism, a trend led by Gucci.
It has 43 stores and aims to grow that number to 70 by the end of the year, with a revenue target of 250 million renminbi, or $37.27 million.
All the brand’s products are made in China with a supply chain set up in Shenzhen. “Eighty to 90 percent of our products are manufactured in Guangdong Province, as it has the complete set of suppliers in the country. While for traditional craftsmanship, such as silk embroidery, we work with ateliers in Jiangsu, Zhejiang and Shanghai,” said Manxiu Wang, general manager of Le Fame.
He believes contemporary consumers care more about “brand operation ability,” meaning how it’s presented at the end of the value chain. “Except for very few luxury brands, consumers don’t really care about where it’s made,” he added.
A source said the company is in talks with LVMH-backed L Catterton Asia and an announcement will be made after the initial public offering of GXG, another Chinese fashion company in which L Catterton invested in 2016. WWD has reached out to L Catterton Asia for comment.
Ban Xiaoxue: Small and beautiful operation.
Xiaoxue Ban, founder of Ban Xiaoxue
Annual revenue: 450 million renminbi, or $67 million in 2018
Xiaoxue Ban started his career at one of China’s leading designer brands, Exception de Mixmind, in 2007. He started his own label in 2012 and was the winner of the Woolmark Prize in the China region that same year.
Fast-forward to today and the brand runs 66 stores across major cities in China.
“For a long time, the phrase Made in China has not been glamorous. It was synonymous with ‘world factory’ and even labeled as ‘knockoff.’ However, it’s a different story now. Made in China has become the core competitive advantage of our brand,” said Ban.
Seventy percent of the brand’s fabrics are sourced from Chinese suppliers, and 100 percent of its garments are manufactured in the country. “China has many excellent textile raw materials, such as silk, cotton, hemp and China can produce high-quality fabrics by itself, instead of blindly sourcing imported fabrics,” he said.
“I start the designing process from fabric. There are many factories that are good at textile development in the Pearl River Delta and Jiangsu and Zhejiang provinces. However, each factory is good at different things; it requires us to inspect each factory and understand their strengths and weaknesses,” he said.
Although the reputation and influence of Made in China is on the rise, Ban thinks the industry is still very self-conscious about the issue.
“I remember when I started the brand in 2012, many of my friends suggested that I register abroad and give my brand an English name. I can imagine that the Chinese market still has a certain prejudice against Chinese brands, especially those with higher prices. Such a mentality has caused our enterprises to open their mind toward domestic advanced technologies and products, making the industry’s innovation and development more difficult,” he said.
He also worries that the relocation of factories to Southeast Asia and Africa, the rise of labor costs and the aging technicians will lead to a crisis in preserving traditional craftsmanship.
Ban said the biggest challenge and opportunity about the Chinese market is that it’s highly unpredictable, especially in the last decade. “It is a very complicated topic. Different generations like different things and shop differently. Not to mention the regional differences in culture, aesthetics, climate and body characteristics.
“From this point of view, the market is smaller. As a designer brand, we can only do smaller and more refined things. The era of blind expansion has passed. In addition, foreign brands have entered the Chinese market in large quantities in these years, which has made the market more competitive. One wrong decision, you will be eliminated by the market.
“However, our advantage is that we are Chinese. We know more about what the Chinese consumers are looking for. For us, the first step was to build the product. The customer recognizes the product and begins to get curious about the story behind the clothes,” Ban said.
Feng Chen Wang: Make Made in China a strong brand.
Feng Chen Wang, founder
Headquarters: Shanghai and London
Annual revenue: 15 million renminbi, or $2.23 million in 2019 (estimated）
Royal College of Art trained and LVMH Prize nominated men’s wear designer Feng Chen Wang has been telling her personal journey with her designs season by season. She used Made in China as her inspiration for the spring 2019 collection, which was shown during New York Fashion Week.
The designer witnessed the rapid changes that fashion manufacturing brought to the country. She was born and raised in Fujian Province before moving to Beijing for university. Fujian is a center for men’s wear and sportswear manufacturer. Some of the biggest Chinese apparel companies are based there, such as Anta, Septwolves and JoeOne.
“Made in China for me is about making high-quality clothing and is also related to culture, traditions, history and humanity. Before I did the ‘Made in China’ collection, people around me worried if it would be accepted. But the feedback was very good at the end. They were proud of what I want to present,” she said.
More than half of Feng Chen Wang’s products are made in China, with the rest made in Europe. “Jiangzhe area [Jiangsu and Zhejiang provinces] is quite good, with a focus on woven styles and knitwear. Guangzhou factories are good at jersey styles. Working with big and high-standard factories is very important, as well as getting support from factory owners,” Feng added.
Delivery is the key factor for her to decide where to produce what, and surprisingly not cost. “Some of the productions in China are even more costly than Europe. Also, delivery within Europe is easier than shipping from China to other countries in the world, especially when we have so many international stockists,” said the designer, who has 54 stockists worldwide.
While some European markets still see Made in China as a problem, Feng is not too worried. “It will need time, once we bring out better thing, all people will open their mind to accept it.”
Ms Min: Integrity and family.
Ian Hylton, chief executive officer
Revenues: Not available
Xiamen-based Ms Min started off as a Taobao brand in 2010 and began selling at Lane Crawford’s Shanghai store in 2013. It now has one store in Shanghai and 61 points of sales worldwide.
Designer and founder Min Liu graduated from the London College of Fashion and interned at Viktor & Rolf in Amsterdam before returning to China, where she took a job at Ports 1961 and met her husband Ian Hylton, a former Ports 1961 executive who now runs Ms Min with her.
A combination of East and West, Hylton often finds Ms Min on the receiving end of the perception that making in China is one of their biggest challenges.
“In fact, making in China, or in our home of Xiamen, is one of our most important assets. We are almost completely verticalized, from design through to production, employing nearly 100 staff members all under one roof,” he said. Experts in their fields work together to ensure that the fit and drape of every piece manifests as per Min’s intention.
Knitwear, silks and artisanal embroidery are outsourced as they require special techniques. For example, the brand works with local Suzhou embroidery studios, a craft whose origins date back 2,000 years and use only the finest threads and meticulous techniques.
For Hylton, Made in China means integrity and family. “For us, this is the only way to work — it is the heart, soul, the spirit of Ms Min. Our success, reputation and relationship with our clients depend on it.
“We believe that it is how you make, rather than where you make, that is an important difference. We believe it’s our duty to educate our agents, buyers, clients, media on how Ms Min makes. We hope that we will one day represent the makers of China who have dissolved this stereotype, lest we not forget that China in fact, has had a history of luxury that is not hundreds of years old, but dynasties old.”