Two Chinese women in their 30s have launched a supply chain platform to target tens of millions of individual tailor shops who are struggling with mounting cost to meet consumers' rising demand for quality of business attires and dresses.
Different from a number of fashion startups that focus on the individual consumers, the platform supplies fabrics, samples of fabric of various colours and weight, a website tool that conducts artificial intelligence (AI)-assisted measuring, and shirts and suits manufacturers who complete the cutting and sewing up of clothes after tailor shops have done their consumers' measurement.
The platform also offers a supply chain for leather goods such as wallets, bags, purses and mobile phone holders that are latched onto trouser belts, the last being highly welcomed by retired and senior citizens.
The website also has modules to help tailor shops do customer relationship management, accounting and customer development. Essentially this is a Software as a Service (Saas).
Anyone can run a tailor's shop
Shanghai Longyu Fashion Co. sources from 35 fabric manufacturers across the world. "We work with small, niche brands that have unique offerings," said Yang, demonstrating a leather bound "book" of strips of linen from Baird Mcnutt of Ireland, "and don't source from big brand suppliers, which tend to focus on the mass market."
The website is rather simple in interface and highly intuitive, but this is exactly liked by tailor shop owners, who are mostly of low educational backgrounds and would find it intimidating if the digital tool is rather cumbersome to use, said Yang, who studied in the UK from high school to getting her MBA during 2001-2009.
Tailor shops are usually managed by a couple, or an individual. And an increasing number of people from outside the fashion industry are entering the trade to launch tailor shops, these can be formerly real estate agents and golf club workers, but most shops complain of difficulty in finding and keeping an experienced tailor. "Tailors are expensive, and tend to quit to launch their own shops after some time", explained Yang.
With Longyu providing the supply chain, a tailor shop does not need a tailor any more, but would only need a person who can smile and measure.
Yang is a serial entrepreneur who started her own takeaway food restaurant in UK before selling it, and back in China, after working for two years in his father's construction material company, set up her own companies, among which a distributor for an Internet technology product and a farm in Chongming Island, the latter she exited by selling it to a Beijing real estate company.
Sales on a fast track
The company's sales doubled every year since 2016 when Yang met with Li Dongxue, who graduated with a bachelor degree in industrial supply chain in 2003, and had run her own few tailor shops in Shanghai. Last year it made sales of RMB 3 million (USD 400,000), generating a net profit of RMB 280,000. Its 20 customers (tailor shops) are located in Shanghai, Hangzhou, Nanjing and five other cities.
Having clothes custom made is a growing trend, said Yang. In the past, civil servants had their uniforms mass-produced from a big fashion company or bought directly from a retailer, but "now they want each uniform tailor-made for each individual," she said.
The annual sales of the customised clothing market was estimated at RMB 150 billion last year, according to China Industry Information Network.
In a cusomised fashion exhibition last month, the company signed up 36 tailor shops from across the country, with more than 100 tailor shops having expressed interest in further communication. The result demonstrated the prowess of the company's business model and solutions, said Yang, who is also secretary general of the Hubei Province's Shanghai Chamber Female Entrepreneurs（湖北省女企业家上海商会）and Huanggang's Shanghai Chamber of Commerce (黄冈上海商会), both associations being a source of business leads and support.
Fund raising plan
Longyu is in the process of raising at least RMB 5 million in private equity. "Without the external investment, my company would still do well but we want it to grow faster and operate on a bigger scale," she said.
She has her eyes on Ybren.com (衣邦人)，iordershirts.com (量品)，Matchu (码尚), Cybespoke (领御 ), which are earlier pioneers in the Internet-powered fashion startups and have made substantial fund raising that contributed to their scale of operation. Matchu (码尚), which provides customised shirts for men, for instance, completed three rounds of fund raising last year, raising more than RMB 60 mn in total.
However, in terms of business models and market focus, Longyu stands apart from all these companies, in that they are all B2C companies, targeting individual consumers as their direct customers, while Longyu is a B2B company: a customer it services brings in deals of much bigger size and tends to be much more stable and loyal.
"B2C companies rely on advertising and promotion heavily, which costs lots of money," said Yang. "Once stopping promotion, the number of customers dwindle immediately."
To much extent Longyu's business model actually is closer to Zilingo, a B2B fashion supply chain platform based in Singapore. The latter is an unicorn in valuation, active in Southeast Asia, having completed raising its Round D of USD 266 million four months ago.
The company currently has customers' body measurement data for more than 10,000 people. As more tailor shops join her company's supply chain platform, the database expands accordingly, allowing it to be more savvy of the market trend and give more apt and precise recommendations to clients on styles and sizes.
Yang said that her company has also leveraged synergy from weight control studios, wedding event management companies, pushing out the boundaries of the ecosystem.
###
Sam Gao, partner of Top Guide Advisory Shanghai, which does industry research and consulting services for investors and corporates / startups in the food industry. The firm also masterminds and writes white papers, profiles and biographies for entrepreneurs and businesses. At this stage, one of the ongoing projects matters with fund raising for a VC that is to invest in alternative protein only. The other is mapping out the world bakery landscape and trend.
【作者介绍】：高海平，90年代新华社双语记者编辑，2000年5月在dot com泡沫时代加入英国互联网公司Wcities（类似于大众点评），2001-2015年相继为英国市场研究公司Euromonitor、Canadean、Mintel和荷兰合作银行（Rabobank）研究部工作。
现为高纲企业管理咨询（上海）事务所(Top Guide Advisory)联合创始人，从事行业研究与咨询，为企业策划股债权融资，包括业务梳理、商业计划书和关于创始人的访谈稿件的写作。2018年1月为亚洲（中国除外）客户推出ICO咨询及白皮书（英文）写作。
同时兼任汕头东峰基金和上海弘章资本等投资机构的行业研究与食品农业顾问、新加坡赛温投资的副总裁、中欧国际工商学院（CEIBS）众创平台、World Bakery (世界烘焙)杂志和瑞士荣格的亚太食品制造月刊的特约撰稿人。
博客文章（以英文为主）阐述前瞻性行业观点，同时以新闻体裁的笔法报道食品等快消行业有特色的中国人、公司和事情。
