Industry Reading: The Expanding Philosophy of the Three-line Market

Bird Listens to Consumers’ Hearts

In 2010, the elegant bird’s terminal expansion was referred to as a “nest-building” operation, signaling a strategic push to grow its market presence. This approach involved entering new regions and establishing a solid foothold, similar to many other clothing brands that expand through opening multiple stores in target markets.

What makes the elegant bird unique is its ability to achieve strong sales performance in 2010, with a significant increase in revenue showing that its expansion plan was on the right track. This success can be attributed, in part, to the effective management of franchisees and the support provided by the brand.

Support in Place

One of the most successful examples of the elegant bird’s expansion in 2010 came from Zhejiang. An agent there opened 11 stores within just one week in August, showcasing the enthusiasm of the dealers and the profitability of the brand’s model.

The company’s support policies for agents and dealers played a key role in this success. These included subsidies for store image promotion, rent assistance, and product support. At a macro level, the brand launched nationwide advertising campaigns, boosting confidence among its partners. On a micro level, they even offered financial support to help second-tier distributors overcome initial funding challenges.

A standout example is a dealer in Luzhou City, Jiangxi Province. After thorough market research, the elegant bird identified strong potential in the region. With competitors like 361 Degrees starting to enter, the brand decided to open a flagship store on a major commercial street to drive expansion into surrounding areas, including county-level markets.

Despite the high monthly rent of 1 million yuan for the shop, local dealers lacked the capital to proceed. However, the elegant bird stepped in by paying the rent upfront and offering financial support to the dealers. This move not only boosted their confidence but also helped the store open successfully.

Within a few months, the shop had already recovered its costs, proving the accuracy of the brand’s market research and its strategic vision.

Third-Tier Market Layout

The success of the elegant bird’s expansion depends largely on whether its agents are motivated and able to effectively promote the brand. Without proper incentives, expansion strategies may fail, leading to delays and higher costs.

So far, the brand’s retail expansion has been highly effective, with hundreds of new stores opening across the country. This indicates that agents recognize the value of the current strategy and see profitable opportunities.

Most agents are not interested in developing a single-brand retail chain unless they see clear profit potential. This often leads to conflicts between agents and brand operators during expansion.

However, the elegant bird has managed to maintain a positive relationship with its agents. By ensuring profitability for most dealers, the brand has grown rapidly. It took only eight years, from 2002 to 2010, to reach 5,000 retail stores.

According to Wang Zhidong, a brand manager at the elegant bird, while some dealers may not be profitable, the overall trend remains positive. He emphasized that the brand’s precise selection of target markets plays a crucial role in maintaining profitability.

This year, many of the brand’s new stores have been located in third- and fourth-tier cities in Guangxi and Yunnan, where the cost of opening stores is lower, and market potential is high. Additionally, major competitors are still in the development phase, making it easier for the elegant bird to capture market share.

With strong support from the brand, including detailed market research and clear subsidy guidelines, the elegant bird has been able to expand efficiently. As a result, sales have doubled, and the brand continues to grow steadily.