From a small workshop worth RMB 20,000 to a net worth of over RMB 4 billion

25 years old is a prime and high-spirited age in life. For those who aspire to build a century-old factory, For enterprises, it is a prosperous and prosperous situation. Ningbo Youngor Group was born at the beginning of reform and opening up. In the 25 years of ups and downs, it has kept pace with the times and taken steady steps, writing a colorful chapter in the clothing history of China and the world.

From 20,000 yuan to a net worth of more than 4 billion yuan, he created a miracle in 20 years

In 1979, Shizhen, Yinzhou District, Ningbo City (then known as Yin County) was established A youth clothing factory. It is said to be a factory, but in fact it is just a primitive small workshop living in the basement of the stage. Several household sewing machines were bought with 20,000 yuan of resettlement funds for educated youths. Rulers, scissors, and stools were brought by the employees themselves. It mainly processes vests, etc. for other factories. Little things like shorts and sleeves.

At the beginning of the next year, Li Rucheng, who grew up with his father's rightist label and was sent from Shanghai to Yinxian County to work as a farmer for 15 years, was placed in Qingchun Factory. He first worked as a laborer pulling pallets and transporting bricks, and was later appointed as a tailor. Team leader. Just when the small factory was facing a crisis, Li Rucheng went to the Northeast to take over the processing business of 12 tons of fabrics, bringing the small factory back to life. From then on, Li Rucheng gradually showed his management talents, and was eventually promoted to the position of factory director by workers.

In 1983, Li Rucheng learned that Shanghai Kaikai Shirt Company was looking for a processing point, and he was excited: Kaikai is a famous manufacturer in Shanghai, why not borrow the ladder to go upstairs? After some hard work, the two parties reached an agreement: "Kaikai" will provide the trademark and related technology for a fee, and "Youth" will produce and sell it as a branch factory. In the second year, Youth Factory's profit soared from 400,000 yuan to millions; in the third year, sales reached 10 million yuan, and profits doubled.

After finding the first pot of gold, Youth Factory was not satisfied with working for others. In 1986, Qingchun Factory launched its first brand - "Beilun Port". In 1989, the annual sales volume of shirts in Beilun Port reached 3 million pieces. Just when "Beilun Port" was at its peak, Qingchun Factory made a surprising decision: to abandon the mature Beilun Port brand and form a joint venture with Macau Nam Kwong Company. Li Rucheng has a profound vision: This brand with a strong local flavor has limited potential for future development. If the company wants to move up, it must be reborn.

In August 1990, the Sino-foreign joint venture Youngor Garment Co., Ltd. was born, and the registered trademark "Youngor" came out. "Youngor" is not only the English homophony of "youth", but also cleverly embedded in the name of Yadu village where Li Rucheng worked as a farmer for 15 years. Later, people called this reform "Younger Nirvana".

Since then, Youngor Group has continuously stepped up: in 1993, it was restructured into a joint-stock company and its property rights were clarified; in 1998, the company was listed and entered the capital market... Today, Youngor Group has a net worth of more than 4 billion yuan. Assets, more than 40 economic entities, more than 20,000 employees, with an annual output of 10 million shirts, 2 million suits, and 20 million other apparel items, becoming the leading enterprise in China's apparel industry and the largest and most advanced shirt and suit production company in Asia Base, its comprehensive strength ranks 144th among the top 500 large enterprise groups in the country. In more than 20 years of entrepreneurship, Youngor has created a myth.

From focusing on one industry to multi-wheel drive, every step is steady

What is the secret of Youngor’s rapid development? Li Rucheng's answer was simple: take every step steadily and avoid detours as much as possible.

In order to avoid detours, Youngor pursues the principle of borrowing: to create the Youngor brand, it draws on the ideas of foreign companies such as Pierre Cardin; to engage in joint-stock reform, it not only draws on the experience of companies in Hangzhou and Shaoxing, but also The characteristics of Wenzhou enterprises; a series of major decisions such as brand extension and marketing strategy almost all have the shadow of other people's innovations.

After relying on clothing to dominate the world, Youngor has been extensively involved in the fields of commerce, finance, printing, advertising, real estate, construction and decoration, and gradually formed an "integrated business" with the clothing industry as the main industry and international trade and real estate as the supplement. "Two wings" industrial pattern.

Developing international trade, establishing an international marketing system, and driving the development of related industries are one of Youngor's focuses. Youngor has successively set up international trade institutions in Ningbo, Shanghai, Hong Kong and Japan. While expanding its own import and export business, it has joined forces with other foreign trade companies through holdings and industrial and trade joint ventures.

In 1999, Youngor Group invested heavily in Ningbo Company, a Chinese export commodity base directly under the Ministry of Foreign Trade and Economic Cooperation. After the restructuring, China Base Ningbo Foreign Trade Co., Ltd. has become the first new joint-stock foreign trade enterprise in the country that spans industries, regions, and ownership systems. Relying on Youngor's financial strength and famous factory effect, as well as its own international trade routes, Zhongji Ningbo Company has trade relations with 112 countries and regions. Last year, its import and export volume was US$778 million, ranking first in Ningbo and the highest before the restructuring. 8.3 times that of 1999. The company's registered capital increased to 120 million yuan, 20 times that before the restructuring.

Real estate is an industry that Youngor has upgraded. In 1992, Youngor jointly established a real estate company with Macau Nam Kwong Company. Now the number of real estate companies has increased to 4. In the past 10 years, Youngor has developed Rheinburg Villa Area, Haiyi Garden, Donghai Garden, East Lake Garden and other star properties in Ningbo with its good reputation.

Youngor has made great achievements in the field of securities investment and is the second largest shareholder of CITIC Securities

Youngor has also invested heavily in infrastructure industries, social welfare undertakings and even the media industry. Such as participating in the investment in the construction of Hangzhou Bay Bridge. Last year, with a total investment of 250 million yuan in the first phase, the Youngor Zoo covering an area of ??1,900 acres was built on the bank of Dongqian Lake, which is equivalent to 23 times the size of the original Ningbo Zoo. In May of this year, Youngor participated in investing in the operating business of Southeast Commercial News, a subsidiary of Ningbo Daily Newspaper Group. This is one of the first media pilot projects in the country to introduce social capital participation since the central government made the decision to deepen the reform of the cultural system.

From "building a multinational group" to "building a century-old enterprise", the business philosophy has matured

Careful people have discovered that in the early 1990s, Youngor's goal was to "create the world." brand and build a multinational group." Later, it quietly changed to "create an international brand and build a century-old enterprise".

This is not a word game, this is a major adjustment of the company's strategic goals, and it is also a sign of the maturity of the company's business philosophy.

Why make such an adjustment? "At first, newborn calves were not afraid of tigers." Li Rucheng said, "Although we have made great efforts towards this goal since the 1990s, compared with foreign multinational enterprise groups, whether it is cultural connotation, technological innovation, or Neither brand nor management has the core competitiveness required by a multinational group, and it is still a follower-type enterprise."

After facing the gap, Youngor took three steps: First, work hard to practice internal skills. , establish a strong marketing network system. The second is to expand the international market and successfully develop the Japanese market. The company's annual marketing revenue in Osaka, Japan alone reaches 40 million US dollars. It has set up a branch in Hong Kong and is currently setting up a branch in the United States. The third is to participate in famous international expos such as London, Paris, New York and Milan to expand Youngor brand awareness and become a window of international famous brands.

Li Rucheng has another reason: the company's strategic development goals must be closely related to the interests of employees and shareholders. Youngor's greatest hope is that the company can develop healthily, stably and long-term, and provide employees and shareholders with lasting and good returns.

After listing, Youngor attaches great importance to the return to shareholders. It has implemented 2 capital increases and 5 cash dividends. This year, it launched a dividend plan of converting 10 shares into 7 shares and distributing 5 yuan in cash. . When the company's articles of association were revised at the shareholders' meeting last year, high cash dividends were included in it, and it was proposed that "the annual cash dividend distributed should not be less than 30% of the company's net profit for that year", thus ensuring high returns to investors from a institutional perspective.

Twenty years ago, American futurist Toffler classified the textile and clothing industries as "sunset industries" in his "The Third Wave". His reason is that these traditional industries have high labor costs and low technological content.

In the 1990s, low-cost expansion coupled with fierce competition within the industry resulted in a serious backlog of textile and apparel products in China. Most companies were struggling, and the pessimistic "sunset" theory was prevalent for a time.

However, in the course of 25 years of development, Youngor has been in a prosperous situation, and the snowball is getting bigger and bigger. Annual sales exceed 10 billion yuan, and its comprehensive strength ranks 144th among large enterprise groups in the country. It confirms Li Rucheng’s conclusion that “the garment industry is an urban industry where the sun never sets”.

How did the "sunset" become the "rising sun"? Let’s take a look at Youngor’s business methods.

New technologies promote industrial upgrading

In 1990, when the Sino-foreign joint venture Youngor Garment Co., Ltd. was established, it invested millions of dollars at a time to introduce products from Germany, Japan, the United States and other countries. With more than 300 sets of internationally advanced technical equipment and high-quality Youngor brand shirts, it has quickly gained market favor and created a new world in the field of mid-to-high-end clothing.

In 1994, Youngor introduced HP shirt-free ironing technology from Japan. After the product was launched, it set off an iron-free craze in the domestic shirt consumer market. In October of that year, Youngor's cotton iron-free shirt was jointly evaluated by five ministries and commissions including the National Science and Technology Commission as the first national new product in the history of my country's shirt industry. Since then, dozens of domestic shirt factories have introduced HP technology, making China's HP cotton iron-free shirts more popular than Japan. Four years later, Youngor exclusively introduced American patented technology - the most advanced VP iron-free shirt technology in the world. After the product was put on the market, it became popular in the market for its multiple functions such as environmental protection, ironing-free, and comfort. It was once again rated as a national new product by five national ministries and commissions. This year, Youngor introduced the world's cutting-edge nanotechnology from the United States and exclusively developed Nano VP iron-free products, which will be launched soon.

After shirts, suits are Youngor’s second main target. In 1994, Youngor, which has already won the title of China's top ten famous brand shirts, introduced modern suit production lines from Germany, Italy, Japan and other countries, and introduced suit samples and technology from an Italian company that was the best in men's clothing design and production at the time. A year later, Youngor suits with Italian loose style became popular in the market and became a dark horse in the field of domestic suits.

Since then, in order to ensure the accuracy and speed of material selection and cutting of suits, Youngor has successively introduced world-class fully automatic pre-shrinking and CAD systems, and established the most advanced suit pattern center in the world at that time. . These equipment and technologies not only ensure the precision and quality of suits, but also shorten the development cycle of new products from one month to one week, greatly improving the competitiveness of suits in the market. After several years of hard work, Youngor suits have become popular all over the country and occupy the top spot in the domestic suit market share.

For many years, Youngor’s annual investment in science and technology has been almost 50 million yuan, and it has reached 600 million yuan so far, almost gathering the most advanced clothing manufacturing equipment in the world.

New changes have spawned new marketing networks. In the past, the main sales channels for Youngor products were basically state-owned and collective commercial enterprises. Due to the lag in the operating mechanisms of these enterprises, sales methods and services are increasingly unable to adapt to market demand and cannot meet Youngor's development needs.

In 1995, Youngor Group Company mobilized more than 300 elite soldiers to form Youngor Clothing Co., Ltd. and built its own sales network system. In that year, it established more than 30 markets in some economically developed large and medium-sized cities. Based on the central city, it radiates to regions, counties (cities) and even towns.

In 1999, Youngor invested 300 million yuan to build more than 100 large-scale flagship stores in Hangzhou, Nanjing, Wuhan, Chengdu and other major cities, seizing the commanding heights of the market. The environment and image of these flagship stores are first-class in local cities. Since then, the number has gradually increased to more than 400. In September 2000, the "Youngor" store on Nanjing Road in Shanghai opened with a business area of ??1,600 square meters, becoming the largest clothing store in China at that time.

In 2002, Youngor’s self-operated channel sales accounted for half of total sales, and its main products, shirts and suits, both ranked first in market share. They were both awarded the “China Famous Brand Strategy Promotion Committee” "Famous Brand Product" title.

In July 2003, at Youngor’s annual marketing conference, economist Wei Jie, marketing experts Li Guangdou, Qu Yunbo and others appeared. This is the first time in the history of Youngor that a marketing meeting is held in the form of centralized teaching by several experts, which shows that Youngor attaches great importance to marketing strategy.

After the reform, Youngor showed the outline of a new marketing system: building 1-2 large central flagship stores in central cities, and then providing services to surrounding sales terminals. In this system, the flagship store is at the center of collecting and organizing logistics and distribution information. It also serves as the main body of product sales and store demonstration role. As the leader of the marketing network, Youngor's self-operated flagship store has become the brand image center, customer gathering center, sales center and information center, shaping a marketing channel that is in line with international standards in the wave of economic integration.

By last year, Youngor Clothing Company had established more than 100 branches across the country and had 2,000 marketing outlets. This year, Youngor once again reformed its marketing system, established Northern Company and Western Company, and explored new management models. With the rapid expansion of the market network, the domestic sales of Youngor clothing products are increasing at a rate of more than 20% every year. At present, more than 60% of the sales of Youngor clothing products are completed by various Youngor stores.

New goal: Expand the international market

Making domestic consumers a household name is not Youngor’s ultimate goal. In order to gain recognition from the international market, Youngor proposed a new goal for its second entrepreneurship: to create an international brand and build a century-old enterprise. To achieve this goal, as early as 1997, when Youngor shirts and suits were in short supply in the domestic market, Youngor Company decisively decided to expand export sales and expand international business routes. They established close ties with the business community in Japan and Hong Kong and hired local capable personnel to develop and operate trade routes. When the Japanese economy was in a sluggish state due to the impact of the Asian financial crisis, Youngor Group Japan achieved miraculous development, with sales exceeding US$50 million and profits of US$800,000 in 2001.

In order to build an international brand, Youngor hired Mr. Marty, the founder of the "Paris Fashion Studio" in the world's clothing capital and the former art director of the "Paris Institute of Fashion Design" in the United States, as Youngor's brand consultant. It invested 50 million yuan to establish the largest design center in China and invited a group of Chinese and foreign fashion design masters to join. At the same time, it invested 50 million yuan to cooperate with the Chinese Academy of Sciences to implement digital projects, use modern management methods to unify the management of Chinese and foreign markets, accelerate the development of new products, and enhance market competitiveness.

In order to enhance the potential to create an international brand and quickly realize the internationalization of garment quality and style, Youngor has jointly established a joint venture with companies in Japan and Hong Kong to build a world-class Youngor International Textile City to solve the current serious problem of textile fabrics. It lags behind the production of ready-made garments and adapts to the new needs of high-grade, high-quality, small-batch, short-process, and multi-variety garment production.

After several efforts, Youngor’s popularity has gradually increased in Japan, Europe and the United States. When an authoritative Japanese magazine predicted the 1,250 companies with the most promising development prospects in Japan in the next 10 years, Youngor Japan ranked 268th. In October this year, Youngor will set up a branch in the United States, hire an American as marketing director, establish its own overseas marketing channels, and lay the foundation for creating a world-class enterprise.

After all, a 25-year-old new factory cannot catch up with the 200-year-old old factory in the West. However, 25 years of hard work has greatly shortened the growth process of the 200-year-old factory.

When you enter Youngor, you will be surprised by its size: the upstream textile city, the midstream clothing city, and the downstream flagship store, like an aircraft carrier. Upstream, midstream, and downstream form a complete apparel industry chain. Interestingly, every link in this industry chain was opposed by industry experts when it was first established. Even today, many people still hold objections. However, even opponents have to admit that Youngor's sailing-against-the-current thinking in decision-making has become the source of vitality for the company.

Garment City: a world-class manufacturing factory

In 1994, Youngor began to get involved in a new field: acquiring a small factory to produce suits. At that time, Shanshan Suit, which was close to Youngor, was already the number one brand in China. Many people advised Li Rucheng not to touch eggs with eggs. Li Rucheng has always had the "three don'ts": don't do things that you can't see clearly, don't do things that are beyond your reach, and don't do things that are beyond your power. But this time he said: "I can see clearly that this market is very big!"

The rapidly expanding market has indeed given Youngor high returns. From 1994 to 1997, Youngor's annual sales revenue increased by an average of 88%, and its profits increased by an average of 95%. Youngor's suits soon became the number one in China.

In 1996, when Youngor, already the largest clothing manufacturer in China, formulated a new five-year plan, it still focused on developing clothing as a leading industry. This industry positioning was immediately questioned by some experts. They believe that Youngor has completed primitive accumulation through clothing. If it wants to continue to develop healthily, it is best to adjust the direction of its main business and jump out from the clothing industry.

Li Rucheng has different reasons: Most brands in the world have gone through the development process of industry, marketing and then brand. After one or two hundred years of accumulation, manufacturing industry has been gradually eliminated as labor costs continue to increase. , become a single brand.

At the same time, the world's apparel center has been shifting. Currently, European and American apparel companies are moving manufacturing to developing countries. China's export opportunities will increase in the future.

He also believes that with the development of the economy, the demand in the domestic clothing market will increase significantly, and we cannot abandon the clothing manufacturing industry prematurely without being divorced from national conditions. Now, Youngor's clothing manufacturing profit is over 15%, and there is no reason to give up and do something unpredictable.

In 2001, the Youngor International Clothing City with a total investment of US$100 million and an area of ??nearly 500 acres was completed, with an annual output of 10 million shirts, 2 million suits, and 20 million casual wear and trousers. production capacity, becoming the largest comprehensive clothing production base with the best equipment and the most complete functions in the world so far. After visiting Youngor, world fashion master Pierre Cardin repeatedly praised: "I have visited all the well-known clothing companies, and your scale is unique in the world."

Younger's giant-style clothing city, Not only has it set a high industrial threshold in front of domestic competitors, but it has also attracted a large number of partners from all over the world. Nowadays, other companies are going out to attract investment, but foreign companies are coming to cooperate with Youngor.

Textile City: a product of the industrial trough

Just opposite the International Garment City is Youngor's larger textile industrial city. It covers an area of ??500 acres, with a total investment of US$100 million. The first phase of the project has been put into production. And this textile city was not a project that was favored by experts at first.

In the 1990s, China's textile industry fell into a trough. From 1993 to 1998, state-owned textile enterprises suffered losses year after year. The most serious loss in 1996 was as high as 10.6 billion yuan, making it the most difficult state-owned industry. The industry with the worst losses. In 1997, the central government proposed three major tasks: "squeeze spindles, reduce staff, and turn around losses", requiring the reduction of 10 million backward cotton spindles in three years.

Amidst the noise of "ingot pressing and transformation", Youngor decided to invest heavily in building a textile city. Faced with doubts from experts, Li Rucheng replied: "The aging of textile companies is just the aging of their own mechanisms, and does not represent the aging of the textile industry."

Li Rucheng believes that clothing can be imitated quickly, but fabrics must be imitated. a stage. There is nothing wrong with the processing in China's garment industry, the jam is just stuck in the fabric. Solving this problem will promote the development of the industry. Youngor solved this problem by itself, not to make money, but to ensure the internationalization of the quality and style of ready-made clothing materials.

For Youngor, the Textile City project is also forced by the situation. my country's fabric self-sufficiency rate is only 40%, and domestic high-end fabrics cannot yet replace imported fabrics. Youngor purchases fabrics worth 5.6 billion yuan every year, 10% of which comes from abroad. As the cost of fabrics increases, and many domestic fabric companies have entered garment manufacturing, the "bottleneck" of Youngor fabrics has become increasingly prominent, and the clothing manufacturing space has been compressed.

What also tempted Youngor was the market. At present, the domestic garment industry needs to import 5.1 billion meters of fabrics and consume US$3 billion in foreign exchange. If the self-sufficiency rate of clothing fabrics is increased by 10%, 1.6 billion meters of domestic fabrics can be used, the entire textile industry can increase profits by 5.4 billion yuan, and save the country US$1 billion in foreign exchange for imported fabrics. Building a textile city can not only form an industrial chain internally, but also provide products to other manufacturers, becoming another profit point for the company.

The Textile Industry City is jointly built with several comprehensive trading companies such as Japan's Itochu Corporation and Nisshinbo. Among them, Nisshinbo's textile technology is among the best in the world. The joint venture ratio is 70% for Youngor and 30% for Japan. The completion of the Textile City has made Youngor one of the three major fabric bases in China. In 2002, the Textile City was put into operation, with profits exceeding 50 million yuan that year and more than 100 million yuan last year. After the entire textile city is completed, sales are estimated to reach 1 billion yuan.

Flagship Store: Control Your Own Destiny

In the mid-1990s, the production capacity of the domestic clothing industry expanded rapidly, leaving state-owned department stores with insufficient vitality to develop their own sales channels. Due to limited energy and unfamiliarity with the sales industry, poor management and poor efficiency resulted. Some companies have divested sales, and some have replaced them with new franchise models, shifting their goals to product design and brand promotion.

Marketing experts also warned: Only by withdrawing from the marketing link can manufacturers become leaner, concentrate human, financial and material resources, and accelerate the cultivation of core competitive advantages.

For a time, manufacturing companies handed over their products to the market and focused on production. This became a management experience of manufacturing companies and was widely disseminated.

Youngor sang the opposite: Chain stores are the leaders of the entire industrial chain, and large-scale production is based on large sales. If industrial enterprises cannot effectively control the sales process, the production lines will not be effectively utilized. The power of production capacity cannot be exerted. Without smooth trade routes, Youngor's huge production capacity can only lead to a pile of overstocked products. Today, when domestic business development is immature, mastering the sales terminal means taking one's destiny into one's own hands.

Of course, Youngor knows that the separation of industry and commerce is an inevitable result, but not today, but tomorrow. Under the current circumstances, the key for domestic industrial enterprises is to strengthen their own channels. Whoever is closest to the market will take the initiative.

Based on this understanding, while other clothing companies have withdrawn from the sales front, Youngor has aggressively built a marketing network since 1995, from Ningbo, Zhejiang, to East China, and across the country. Now, Youngor has more than 100 branches and more than 2,000 marketing outlets across the country, including specialty stores, shopping mall counters and franchised stores.

In recent years, the apparel sector has contributed more than half of Youngor Group's total profits. Many international manufacturers also use Youngor stores as a channel to enter the Chinese market.