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As a platform for converting the value of goods into consumer satisfaction, the retail terminal has become the critical node in marketing execution within an increasingly competitive and profit-driven environment. Once focused on volume sales and brand visibility, the industry is now shifting toward fine-tuned efficiency. However, many lingerie terminals still operate under outdated concepts—relying more on slogans or superficial image management rather than a deep understanding of their operational systems. This lack of insight into profitability is a common challenge faced by domestic brands and dealers who aim to win over the market.
In China’s underwear market, various types of retail terminals exist, categorized based on brand strength and distribution channels. First-tier brands typically occupy premium shopping mall counters, while second-tier brands focus on exclusive retail and franchise models. Third-tier brands rely heavily on wholesale and distribution networks. With evolving market dynamics, first-tier brands are expanding their reach, second-tier brands are aggressively capturing local markets, and third-tier brands are exploring new retail opportunities through distribution channels.
A new competitive landscape is emerging, where enhancing sales profitability at the terminal level has become essential. Yet, from field visits and research, it’s clear that many companies and distributors still neglect the fundamentals—focusing too much on product concepts and promotions while overlooking the real operations and core needs of the terminal.
**The Foundation of Terminal Profit**
To succeed, terminals must clearly understand the consumer needs they serve. Currently, women dominate the underwear market, accounting for about 60% of sales, with the main age group between 15 and 45 years old. Bra products make up half of this segment, and over 60% of consumers prefer to shop in physical stores, especially in malls and supermarkets. Personalization and fashion are expected to drive future demand.
However, current terminal operations often fail to align with these needs. Underwear is a broad category, including bras, regular underwear, loungewear, thermal wear, body-shaping garments, and more. Many terminals struggle with misaligned product assortments, creating opportunities for new formats and category combinations.
Therefore, terminals should tailor their offerings based on their channel positioning and customer base. The right mix of brands and categories depends on the purchasing power and preferences of the local population. This isn’t just about market research—it’s about learning through daily operations and adjusting accordingly. Without this, terminals risk becoming just a “final stop†without real impact.
Overemphasizing brand image and promotional activities can lead to short-term gains but not long-term profits. The true foundation of terminal success lies in identifying and meeting specific consumer demands. Only then can profitability be sustained.
**The Direction of Terminal Profit Models**
As the market evolves, terminals need to adapt to industry trends. Consumers in second- and third-tier markets increasingly seek value-for-money brands. This shift calls for long-term, multi-seasonal brand strategies. The rapid rise of some retailers has changed transaction patterns, increasing costs and entry barriers. To survive, upstream and downstream companies must integrate new value chain resources through innovative retail models. Chain operations are likely to become the future direction of the industry.
**Single Category Homogeneity**
Currently, only a few categories like bras, regular underwear, and loungewear have well-established brand coverage. Other segments, such as thermal wear and body-shaping lingerie, remain underdeveloped. Many companies focus on one category, accumulating experience and resources to build independent channel structures. While this creates homogeneous terminal layouts, it also leads to challenges: small and medium brands may offer quality products but struggle with poor visibility and low profitability.
**Weak Single Brand Store Profitability**
Many brands are expanding through franchising, aiming to control key retail spaces. However, single-brand stores often lack diversity in product lines, limiting their ability to attract a wide customer base. Their narrow focus makes it difficult to sustain long-term profitability. In contrast, multi-brand stores that combine different categories across seasons can better balance profits and meet diverse consumer needs.
**Traditional and Extensive Terminal Marketing**
Terminal marketing should be a comprehensive system involving product, pricing, promotion, and brand communication. It’s not just about eye-catching displays or flashy promotions. Many terminals still rely on traditional selling methods, neglecting data analysis, inventory management, and customer insights. This inefficiency results in wasted resources and missed opportunities to identify high-profit categories or effective pricing strategies.
**Lack of Strong Regional Retail Terminals**
Despite the number of underwear stores, most are small-scale, lacking strong brand presence and growth potential. Chain operations, however, can leverage brand recognition and diversified product offerings to influence regional markets. They can also challenge smaller shops and help establish leadership in second- and third-tier cities.
**The Core System for Terminal Profit**
For a terminal to succeed, it must be more than just a physical space. Its core elements include brand portfolio, display strategy, sales skills, and post-promotion support. These factors determine how effectively the terminal can generate profits. A well-structured product mix, combined with strategic display and skilled staff, can significantly boost performance.
**Core Brand Portfolio**
Many agents manage multiple brands, leading to inefficiencies and financial strain. Focusing on a few complementary brands can improve sales and profitability. Agents should analyze regional consumption trends and align their brand selections with local needs. A strong, well-chosen portfolio enhances both brand appeal and sales performance.
**Profit from Product Categories**
Product structure plays a crucial role in terminal profitability. A balanced mix of high-end, mid-range, and budget items can cater to different customer segments. Seasonal planning ensures that products are aligned with demand, maximizing profit margins. Poorly planned product mixes, on the other hand, can lead to unsold inventory and missed sales opportunities.
**Promotional Strategy**
Effective promotions are vital for driving sales. While price cuts can attract customers, they can also erode brand loyalty. Strategic promotions, such as special offers and gift bundles, can enhance sales without compromising profitability. Timing and product selection are key to ensuring promotions are both impactful and profitable.
**Data-Driven Operations**
Data analysis is essential for informed decision-making. Understanding gross margins, top-selling categories, and profit contributions allows operators to adjust product mixes, inventory, and promotions. Without this, terminals risk operating blindly, leading to inefficiencies and lost revenue.
In the future, data will be a key driver of terminal profitability. As competition intensifies, companies that leverage data for smarter decisions will gain a significant advantage. It’s time for more brands and distributors to invest in the underlying systems that support sustainable terminal growth.