How to dress children with SHIKO
For 20 years of work on the Ukrainian market, SHIKO Trading House has transformed from an importer of children's clothes and shoes into a multi-brand trading and manufacturing company that distributes famous brands of clothes, develops its own brand of children's clothes and sews to order for such famous domestic designers as Andre Tan and Arber. Alexey Baryshnikov, founder of SHIKO Trading House, tells how the business was built.
Every day in Ukraine about 700 babies are born. According to statistics, at the end of 2018, the number of children in Ukraine under the age of 16 inclusive amounted to 7.6 million. However, in recent years, the market for children's products, including clothing, has sank heavily. So, in 2015 they recorded a decline of 32%, and in 2016 - another 20%. Only 30% of children's clothes that are bought in Ukraine are the things of famous brands. The remaining 70% - “market” and stock products. Although, according to experts, in the near future the situation in the market of children's clothing will improve. Its capacity is estimated at $ 2 billion, and growth is forecast at 15% annually.
All the trends and trends are well known by the founder of SHIKO Trading House Alexey Baryshnikov. He founded his company back in 1995. Started by importing shoes. Gradually switched to Italian clothing. In those years, it was a free niche on the Ukrainian market, so the product was selling very well. Gradually changed the vector for the sale of children's clothing - have become the exclusive distributors of a number of foreign brands.
“In the first years of Ukraine’s independence, the market needed Europeanization. Clothes for adults were delivered systematically. Regularly opened stores under foreign brands. In the segment of children's clothing, the situation was quite different. Here, almost everything is focused on the bazaars. The quality of the goods was not even discussed. There were only two major players on the market, selling high-quality children's clothing from foreign brands, but there was very tough competition between them. When we entered this market, we decided to gradually change the situation, taking a course on multibranding, - recalls how it all began, Alexey Baryshnikov. “We have set ourselves the task of providing small children's stores with branded children's clothing that were not able to buy products abroad.” By 2016, the company was engaged only in wholesale trade, supplying products to more than two hundred retail stores in various regions of the country (including the Antoshka, Sportmaster, Marathon, Toy House, Smik and others).
Due to the crisis, many suppliers have curtailed their activities in Ukraine. Therefore, the company analyzed which brands are the most profitable, and decided to focus on the products of the Finnish brand Reima. This brand is the world leader in the segment of functional children's clothing and has an optimal price-quality ratio. Therefore, the company has become the official exclusive distributor of products from this manufacturer. Now the company has a number of mono-brand stores Reima, an effective online store, supplies Reima clothes and shoes to other trading companies, and also develops the production of its own knitted children's clothing under TM FLASH, founded in 1999, and plans a multi-brand retail concept for its products.
10 successful business solutions Trading House SHIKO
Cold sales. To expand the client network at the start of the business, the cold sales method was actively used. Alexey took product samples and traveled with them in Ukraine. Kharkov, Dnepropetrovsk, Zaporozhye, Donetsk, Mariupol, Odessa, Western Ukraine. He found stores with which he would like to establish cooperation, and offered them products. This process took several years, but gave the maximum result: a wide geography of coverage and ensuring continuous sales. He also managed to establish cooperation with large networks of children's stores - market leaders.
Uniform conditions. For clients, SHIKO created a platform where it was possible to buy goods in bulk, place orders. “To be competitive, we offered an affordable price. Moreover, we were one of the first in Ukraine who began to deliver goods not from European warehouses, but from Southeast Asia. Due to the large number of products, it was significantly cheaper in them. We were engaged in consolidation, sending goods to customers. In order to have stable orders, plan deliveries and eliminate dumping in the market, all customers were given a single price, never made discounts and seasonal sales, ”the founder of SHIKO lists.
Collaboration with B2B clients. SHIKO not only carefully analyzed the range that offers customers, but also its business processes. If at the start cooperation was conducted according to the principle of “came, saw, bought, took”, then today the approaches have changed - with B2B clients work on the principle of managing the balance. Trading House is now entering into a collaboration with them. Business partners are asked how the goods are sold, how the sale process takes place, what is important for their customers and the like.
Access to B2C clients. Today, SHIKO has 10 branded stores in million-plus cities. All of them are located in large shopping centers. Internal statistics show that branded retail brings 20-60% of total sales. In addition, retail gave the company a new impulse: new departments appeared - marketing, retail. Now SHIKO has the opportunity to work directly with the consumer, to receive feedback from the first mouth, and not through partners.
Work on the face of the brand. In SHIKO, a lot of attention is paid to the type of branded retail outlets: signs on the stores, which are the first stopper for potential customers, so they should look bright and attractive; internal design, POS-materials with the disclosure of the technological advantages of products, merchandising. The best advertising is the maximum disclosure of the brand’s potential in mono-brand stores, from the widest range to the most competent advice, says the director of the marketing department of SHIKO Trading House, Alexey’s daughter, Victoria Maria Baryshnikova.
The establishment of its own knitwear production. The infrastructure of the SHIKO two-storey knitted production complex includes warehouses for raw materials and finished products, design and construction sites, semi-automatic and manual cut sections, own knitting and sewing shops. It also has its own photo studio, where subject photography of the goods takes place immediately after it leaves the workshop. This allows you to quickly present a new product to customers.
From tolling to your own brand. At first, the production of SHIKO worked on the principle of tolling - it received orders for tailoring from major brands. Andre Tan, his Ukrainian brand Arber, was producing his products here. Customers provided patterns, and in SHIKO they selected fabric, accessories, designed the design and, in fact, sewed the clothing itself. In the end, the Trading House decided to abandon it and focus on its own products. As a result, 2019 became for SHIKO a year of development of its own brand of children's clothing FLASH.
Go online. With the advent of digitalization, SHIKO decided to keep up with trends and “catch” customers at all points of their localization. The Internet is one of them. Three years ago, a trading site appeared at the Trading House. Despite the fact that the lion's share is made up of offline sales, the online store has the widest and most complete selection. True, SHIKO notes that many customers who place an order online prefer to pick it up independently from retail stores. This can be explained by the fact that in order to make a final decision on the purchase, customers want to look at the product and try it on their child to make sure that the choice is correct.
Product promotion in collaboration with opinion leaders. “We carry out all marketing activities together with partners. For everyone we are preparing high-quality, bright POS-materials and we offer the creation of a branded corner. Marketing works best with the brand collaboration with bloggers on Instagram, YouTube and opinion leaders on Facebook. We attract them with the product, its quality. They test clothes on their little ones, and then share their impressions. They practiced creating their own video content for the YouTube channel, but the “exhaust” was not as planned. In addition, the creation of video reviews is quite expensive - both financially and in terms of resources. Therefore, for the time being, this activity has been frozen, ”says Victoria Maria Baryshnikova about marketing activities.
Cooperation with Raiffeisen Bank Aval. Alexey Baryshnikov notes: “I really appreciate our business relations with Raiffeisen Bank Aval. He always helps, shows flexibility, makes it possible to bypass the cash gaps. It should be noted that, despite all the difficulties that exist in the banking sector and the country as a whole, Raiffeisen Bank Aval always demonstrates high loyalty and flexibility. Now we have a credit line, an overdraft opened in the bank, we also buy currency, we carry out export-import operations through the bank. We issued and served in it a salary project. All operations of foreign economic activity are also carried out through Raiffeisen Bank Aval. For business, it offers a fairly wide portfolio of banking services. If we describe Raiffeisen Bank Aval in one phrase, it is an extraordinary bank with traditions and foreign roots. ”
