A Number Of Start-Ups Have Turned Retailers' Most Troublesome Inventory Problems Into Business Opportunities.

The RealReal, Revolve, and Moda Operandi, which have just announced their entry into the Chinese market, are actually doing one thing: solving the problem of retail inventory in the two major fashion companies listed in the US.

In this $one trillion global apparel industry, inventory is still a big problem facing the industry. It increases the cost and affects the cash flow. Most importantly, it also brings burdens to the earth.

Recently, inventory problems have also plagued fast fashion giants and UNIQLO parent companies. As of April this year, the inventory of sweaters, HEATTECH thermal underwear, down coats and other garments sold by Xun group was worth 44 billion 800 million yen (about 2 billion 840 million yuan). Fast selling group is pushing forward a series of technological changes. By integrating over 1000 entities in over 20 countries, it can open up online and offline retail, strengthen consumer data analysis and improve supply chain to better meet the needs of consumers in various regions.

Moda Operandi's CEO Ganesh Srivats has analyzed the "Commentaries" summit of BoF fashion business in March this year. Changing the relationship between consumers and retailers is a new idea to break through the inventory problem. "Since inventory has become the biggest problem, buyers have become product arbiters, not designers or consumers. I think this should be a discussion on the right to decide, so that consumers can directly talk with designers, maybe some products are not commercialized with buyers, but perhaps for these consumers, this is true. He said.

The killer of Moda Operandi is to predict the future sales trend through enough data, and what colors and styles of clothes can sell well. It can be seen that the power source of Moda Operandi, which has just entered the Chinese market, is a large cash cow besides the new market that can bring new consumer groups.

The same attempt to improve retail efficiency through innovative means is similar to the fashion business platform Revolve. What Revolve has done is to identify the next round round buttons instead of the square holiday skirts through the integration of big data. Another interesting aspect of Revolve is its positioning. Most fashion retailers are trying to walk on the popular front end, while retailers like Amazon are at the popular end of "follow suit". Revolve just benefits in the popular position. This style is positioned with flexible supply chain, and the products launched just trample on the trend point, and 79% of its sales come from full price merchandise.

The RealReal, a second-hand luxury business platform, essentially solves many brands' inventory problems without affecting the brand positioning. Consumers here even have a nostalgic enthusiasm for off season products, such as the Celine you can find in the Phoebe Philo era, or the clothes that New York brand Creatures of Comfort has stopped.

As the founder of L2, Scott Galloway, Professor of net red of New York University business school, said that the platform's wit is to come up with a business model of fallow assets. "The RealReal thought of a way to make money from these tens of millions of high-end fashion inventories, which are not willing to go to Amazon's brand." Galloway said. AI seeks to call such an electronic business "inventory electricity supplier", which refers to the upper end of the supply chain that connects the stock of the tail stock of the brand, provides online trading platform and related services, and touches the consumers directly. Domestic cases like this have just got 1 billion 500 million yuan financing of love inventory, and vip.com and other traditional e-commerce launched the only product warehouse.

Whether it's an inventory business or sales new product, data driven Revolve and Moda Operandi, in fact, it can give back the sales data of the unsalable clothing to the brand, and provide retailers with a new retail idea. From the perspective of brand, think about the inventory problem from a new perspective. Moda Operandi plans to feed these data back to the designer brand on the platform to guide the next quarter's product design. In fact, Farfetch also shared the analysis of sales data with its retailers on the platform during the fashion season.

These new fashion technology companies are constantly changing the relationship between consumers and retailers, forcing brands to start from a new perspective and try to solve inventory problems. It can be imagined that UNIQLO, which causes Heattech products to be unmarketable due to incorrect weather forecasts, can also reclassify products more meticulously and boost inventory efficiency.

Despite so many innovations in retail technology, this actually reflects changes in consumption concepts and consumption culture. As Srivats said, "any business revolution comes from a philosophical movement".