First, the market analysis

The growing demand for lingerie in China is undeniable. With over 600 million women in the country, around 200 million fall into the ideal age group for wearing bras. This translates to an annual spending of more than 600 million bras and a total sales volume of approximately 15 billion yuan. Industry experts suggest that China is now the fastest-growing market for undergarments globally, with the sector still in its early stages of development.

Provinces like Zhejiang, Guangdong, Sichuan, and Shandong have long been considered key regions for second-tier lingerie brands. However, as women become more conscious of their needs and spending power increases, there's a rising demand for high-end undergarments. Bras priced above 200 yuan currently make up about 10% of total sales, but their contribution to revenue is estimated at around 30%, with a market value reaching 5 billion yuan.

Many believe that while the broader apparel industry is maturing and margins are shrinking, the lingerie market is still in its infancy. This has led to it being dubbed “the last piece of cake” in the fashion industry. Data shows that the domestic underwear market has seen double-digit growth in recent years, and some analysts predict that within the next five years, the market could reach 500 billion yuan, with an annual growth rate of 20%.

Second, investment opportunities

High-profit potential makes lingerie a lucrative business. Most domestic brands do not require a large initial investment to open a store, though the amount varies depending on the size of the franchise. A deposit of between 5,000 and 10,000 yuan is usually required. In general, the cost of decoration and rent is relatively low across different brand levels. Many brands offer free store design services to maintain a consistent brand image.

For first-tier brands like Triumph, the initial purchase can range from 10 to 20 million yuan, with the wholesale price typically at two-thirds of the retail price. Second-tier brands may require an initial investment of 15,000 to 50,000 yuan, with the wholesale price set at 4 to 4.5 times the retail price. While profit margins for lower-tier brands are higher, they often rely on lower product prices and smaller returns. On the other hand, first-tier brands have lower margins but higher-priced items, leading to stable returns. They also provide stronger support to franchisees and enjoy greater consumer trust due to their strong brand presence. Overall, the gross margin for lingerie stores is around 50%.

Smaller brands also have their advantages. They face less competition compared to well-known names and offer products with similar pricing but better quality. Their service and shopping experience are often superior to regular stalls, making them appealing to younger, budget-conscious customers. Additionally, because these brands are not as popular, they tend to give franchisees more flexibility in setting discounts and managing operations.

Third, business tips

Running a successful lingerie shop requires more than just good location and branding—it demands knowledge. Owners often emphasize that understanding the nuances of undergarments is crucial, as it sets this business apart from selling regular clothing. Underwear must be comfortable, fit well, and be made from quality materials, yet customers typically cannot try them on or return them easily. This means operators need to offer expert advice to help customers choose the right products based on their body type, age, and preferences.

Location plays a vital role in the success of a lingerie store. High-end brands should be placed in areas that match their target audience’s spending habits to build a loyal customer base. On the other hand, second-tier brands should focus on high foot traffic and consider locations near student populations. Rent should not exceed 50% of monthly income to ensure profitability. Ultimately, a combination of product knowledge, strategic location, and customer service will go a long way in making your lingerie business thrive.

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Shaoxing Haisa Textile And Garment Co.,Ltd , https://www.haisafashion.com