Ever heard of PPG? I’m guessing not, unless you live in China or follow the VC scene there. I thought I’ll talk about them since it’s reported that they just got another 100 million US dollars of funding (their 4th round of funding). News reports claim that the majority of this funding will be used to expand PPG’s operations to the United States.
PPG is a relatively young Chinese company (founded in 2005) that sells men’s apparel directly to customers through the telephone and Internet - they have no physical stores. They grew sales very quickly in the past 2-3 years by employing massive advertising campaigns where they offered “high-quality” shirts and pants for low prices. PPG can offer lower prices because they cut out many layers of middlemen and the overhead of physical stores, delivering ordered product straight from factories to the customers’ doorsteps.
Due to their advertising blitz and because they were widely lauded in many Chinese business publications for their apparent meteoric success, it didn’t take very long for a few PPG “clones” to appear - today PPG faces strong competition from VANCL and eBono, who also have a similar business model and received venture capital funding.
Interestingly if you search for “PPG” in Chinese search engines, it doesn’t take very long to find online articles and blog posts bashing PPG for the poor quality of their shirts, shirt’s colors fading after washing, how difficult it is to return products, etc.
Well I hope it all works out for PPG - they seem to have a decent direct-sales business model, although it looks like they have quality issues to work through and have some strong competition (read: price wars) to fend off.