It seems that e-commerce platform owners are all considering launching their own private-label brands. Following Dangdang.com and Vancl, No.1 Store—known initially for its online supermarket presence—will also roll out its own apparel private-label brand this month on the 20th.

　　Tong Jueming, Senior Product Director of No.1 Store and in charge of the brand-new apparel private label "BESTLUCK," told reporters: "The apparel private label, launched specifically for No.1 Store's existing customer base of over 30 million users, will leverage OEM production to effectively control costs and maintain quality. Initially, it will offer 500 SKUs (stock keeping units)."

　　Independent of No. 1 Store's three major business segments—consumer electronics, food & beverage, and general merchandise—the newly formed apparel private-label team will report performance directly to No. 1 Store's CEO. Moreover, to build this proprietary brand, No. 1 Store has invested heavily, bringing in several key executives who were poached from well-known competitors such as Vancl, the "arch-rival" in the industry.

　　“Cultivating an offline apparel brand typically takes about 5 to 8 years; while online it’s slightly shorter, still requiring more than 3 years.” Tong Jueming emphasized, “Right from the brand’s inception, we’ve aimed for it to grow and thrive under a completely healthy business model.”

　　Even before No. 1 Store emerged, Dangdang's own brand "BondStreet," launched as a copycat of PPG's direct-to-consumer apparel model, was a prime example of short-lived success. High logistics costs and hefty marketing expenses for the new brand quickly became an "unbearable burden," leading to its rapid disappearance from the market. Meanwhile, Vancl, the e-commerce giant in the apparel sector, reported a massive loss of 600 million yuan in fiscal year 2011, a development widely seen as one of the key indicators signaling dramatic shifts in the industry.

　　After entering the Walmart system in the second half of last year, No. 1 Store has chosen this moment to venture into the struggling apparel e-commerce sector—so what exactly gives it the confidence to do so?

　　Tong Jueming pointed out that over the past few years, No. 1 Store has accumulated a robust user base, which not only fosters strong customer loyalty but also enables the company to leverage big data for precise analysis of users' latest needs—information that is seamlessly integrated into product design and manufacturing. "No. 1 Store's core customer segment primarily consists of white-collar professionals aged 19 to 40 with considerable purchasing power. By launching its own private-label brands tailored specifically to these consumers, the company can effectively attract them and drive sales conversions. However, in terms of pricing, our offerings are slightly higher compared to some competitors that rely on low-cost marketing strategies."

　　The No.1 Store emphasized that the company’s pricing strategy for its own-brand products is based on benchmarking against international fast-fashion brands offering similar items, setting prices roughly half of those charged by its competitors. After deducting logistics and brand promotion costs from the gross profit, the company aims to sustain profitability as a long-term "red line." "It’s clear that launching our own brands will complement No.1 Store’s existing performance—rather than becoming a burden."

　　“While it’s not convenient to disclose the exact figures for the funds invested, considering No. 1 Store’s sales of approximately 2.72 billion yuan in 2011 and around 6.8 billion yuan in 2012, this investment isn’t considered particularly large,” said Tong Jue Ming.

　　Tong Jueming openly admitted that in the past two years, the apparel industry has been grappling with high inventory levels and quality-control issues—challenges that even a newcomer like No.1 Store, entering the market as the "younger sibling," could easily encounter. However, with data-driven insights from our robust backend analytics system and the unwavering support of our expert team, we’re confident that any such problems, if they do arise, won’t escalate into major crises. No.1 Store’s own-brand clothing is produced through OEM partnerships, and when selecting suppliers, we prioritize well-known domestic fast-fashion retailers (such as Uniqlo, Marks & Spencer, and others) to ensure strict adherence to quality standards. Meanwhile, in terms of inventory management, we strive to maintain an agile response time, aiming for a rapid turnaround of no more than two weeks on best-selling items.

　　Author: Chen Shijun