Rolling up sleeves for online play
A year back, when Yu Lida and three partners founded iOrder Shirts, an online maker of men’s custom shirts, little did they imagine their business would expand to 36 cities in nine months with monthly sales touching 2,000 shirts.
Today, Yu talks of expanding the online business to 300 of 334 prefecture-level or moderately developed cities in China by 2018, to sell 500,000 shirts a year.
Firing his confidence is iOrder Shirt’s success in raising 6 million yuan ($902,000) in funding from venture capital firms and positive feedback from consumers.
iOrder’s shirts are priced 399 yuan onwards up to 499 yuan, and target business executives and young professionals. The fabric made of long stapled cotton appears shiny and can withstand hundreds times of laundry washes without getting wrinkled.
Yu is convinced he can now be a lot more creative in shirt-making even if that hurts the firm’s profitability.
For more than 20 years, based in Hong Kong, he engaged in bulk manufacturing. The business was lucrative. But it was dictated by his clients, two major Hong Kong-based shirt and jeans makers that worked for top fashion houses such as Burberry and Armani.
In 2010, when the Hong Kong clients started to shift orders to Southeast Asian countries due to rising labor cost in China, Yu pondered going to Vietnam himself and replicating his success model there.
Had he done so, he thinks he could have continued to make profits in millions of dollars every year using cheap local labor. But he didn’t.
He had other ideas.“Many manufacturers went broke when they tried to raise the quality of their products. Their challenge was that they didn’t have direct access to consumers. They could only sell to the dealers who only cared about the price,” Yu said.
Realizing he had financial freedom and hence nothing to lose if he struck out on his own, he quit his job as sales director and launched a business to gain direct access to consumers.
The new company, with focus on selling custommade shirts online, was registered in the southern city of Guangzhou, Guangdong province, where its supply chain was based. But its sales and marketing office was based in Shanghai.
“Customization sounds very simple: you take the customer’s measurements and make a shirt. At least, that’s what many so-called custom garment-makers believe. So, they take the easiest route: outsourcing. But
Distribution, especially commercial space for outlets and stocking or warehousing, is the biggest cost for China’s garment industry, according to Min Guangya, a consultant for the China National Garment Association.
The inventory value of 32 listed Chinese textile and garment companies rose to 22.2 billion yuan in 2015, up 19 percent from 2011.
According to the statistics of Askci Corp, a Beijing-based industrial analysis and consultancy firm, the annual retail sales volume of men’s shirts in China will surpass 800 million pieces by the end of 2018, generating a revenue of 121.5 billion yuan. I stick to the most standard type of men’s shirts ... I see huge potential in this niche market.” Shirts
founder of iOrder are estimated to be sold annually by 2018 through Yu’s online network
their products just don’t meet customers’ needs,” said Yu.
“If the customer wears a tie, the neck needs to be slightly higher than if he doesn’t. If the customer tucks in his shirt, the shirt needs to be slightly longer so that it won’t pop out of the trousers when he raises his arms.”
So, iOrder Shirt adopted a different approach to shirt customization. Its online store collects 70 different measurements from a customer, so that the fit is perfect.
“Without years of experience (in shirt-making), one can’t possibly have a clue how to design an online system that collects customers’ data and make the shirts accurately. My business may be online, but the brick-andmortar factory creates at least half of the value of my company,” said Yu.
Some investors tried to persuade Yu to get rid of the elaborate measurement system as they believe it slows down the whole process.
But, according to Yu, the key to delivering a shirt to the consumer within 15 days after recording the measurements online is that each link of the production process must be dovetailed to another. But he does see that personal interaction is a lot more suitable for shirt customization than online measurements.
“I stick to the most standard type of men’s shirts. As ordinary as theymay seem, I see huge potential in this niche market.” Gao Songya and Mu Sai contributed to this story
Such estimates have attracted many people to various market segments.
For instance, i.Fdu, an online customshirt maker, targets men in the 20-35 age-group. Compared with iOrder Shirts, i.Fdu seeks to offer more diversified and personalized products, cooperating with fashion brands, designers and artists, to make shirts more appealing to young people.
Taylorism, a Shanghaibased online-to-offline men’s customshirt maker, also targets the same group. It plans to make customsuits for men and leather shoes in future.