• Kate Chang

UPDATE #12 - February 9, 2021

Recently, many designers who take an interest in YMYX have written to ask about our current status and updates, and how it is going with the samples being made.


There have been such a large number of inquiries, and I do apologize for not being able to answer each message one by one; as a result, I post here a letter that I have shared with each of our existing partner designers, in order to update them on our status.


Hopefully this update will serve to answer and keep informed those who take interest in our project, so they can follow along in our current progress.

Dear Partner, I write to give you an update on our most recent developments. Just as you know, at present, we are now in the process of the sample testing phase with each of our partner designers, and just a few days ago, some of the partner designers have completed the first finished samples. After having received their permission, we will share some of the images of the finished samples, starting with Mr. Gianluca Soldi, whose shoes were recently completed:



Another partner designer, Oronzo de Matteis, has also recently had samples completed for two of his designs, which we also share below:



Through these photos, I trust that we have now very clearly demonstrated the level of the product quality and positioning that we require. What is clear, is that YMYX provides unique, luxurious and high fashion products, created by talented designer brands from Italy, France, Portugal and Spain, and elsewhere across Europe. In addition, currently these products are crafted by factories based in Italy, Spain and Portugal. The target that we are facing is the emerging Chinese middle class that is ascending with breakneck speed, and they are consumers who not only have a deep obsession and appreciation for European fashion, they also have high taste, travel frequently to Europe for leisure, and have strong desire to buy European fashion goods. But what I want to bring up as a reminder here, is that the partner designers who are working with us, need to be very careful and serious about their design work and the creations that they will present to this vast market, because the Chinese fashion market is no longer the market that it was 10 years ago, where a designer could just design just anything, or make clothing that is similar to what could be found in any average boutique, and still think that those pieces could easily conquer the market just like that. This fashion market has already become a very mature market, in other words, the consumers will no longer be very easily won over, and their loyalty toward brands is becoming increasingly lower. As I trust you already know, China has become the fastest growing and also biggest market for fashion in the world. A huge number of brands have gone to China, including those from Europe, but also from Japan and Korea, as well, not to mention the local brands that are also taking root in the market. As a result, the Chinese consumers now face a really plentiful and diverse set of choices when it comes to their fashion, so if your collection is not competitive, or what you design has too much overlap or similarity to typical fast fashion or mass market brands, then you will definitely not succeed. This is why I hope that all of our partner designers can focus on the design and create collections that will truly leave a deep impression. Some designers have written to me to ask, in light of this, what exactly do you want me to design? I want to take some time to answer this question once here. This is not about what we want you to do - but rather, it's about what kind of fashion do you want to present to the Asian consumer? We do not have the ability to give you a directive, and tell you what to design, what kind of styles exactly; otherwise, we would not need to work with you as a designer partner. One thing we can do, however, is to provide you with constant updates on how the China and Asian fashion markets are moving, including showing you the work of those Chinese students returning from their study abroad in Milan, Paris, London or New York, and who have become entrepreneurs and have launched their own labels back home. But I want to also clarify, YMYX provides information about these brands and the market's movements, not as examples to show how good these local brands are, or in hopes that our partner designers will design the same kind of style, because we believe that to emulate these styles would not result in success. We have no comment when it comes to these local brands' styles; in other words, just because we share these brands with each partner designer does not mean that we like nor dislike these local brands themselves. This is just market information and we feel that as a partner, this information is part of what we ought to provide to each designer who works with us. I want to make very clear on this important point. I hope to remind all of YMYX's partner designers, that when we met during our in-person meetings in Milan, many designers had expressed that they didn't have the financial resources to do the samples and production, to put promotion into place, and take all the other investments necessary to carry out their brand or elevate it to another level, and at that time, the current positioning of their brands reflected that lack of resources, since they were doing it on their own. Nearly all of our partner designers expressed to us that they really treasured the chance that YMYX was providing to them, because they said that they could not find investors to support them, to give them that chance, no matter in Italy, Portugal, Spain, France and elsewhere in Europe, it was not possible to find investors to support them in starting up or expanding their own brands, nor could they imagine there would ever be investors who'd be willing to do so. At the same time, they very confidently expressed to us, that as long as YMYX could do what we promised, then they could definitely design products that would leave consumers breathless, that would be truly stunning. Many designers, at the time of our contract signing even shed tears, which we captured on video as well, and we could see how moved and excited they were. When we decided to work with each of our partner designers, we also fully considered and understood the point of view and sentiments that each had expressed as I wrote above, and we understood and believed in what they said. Even though we had very little information about each designer and we had access to their public works on Instagram and elsewhere on the web, we still chose to believe them and in what each designer told us, that as long as YMYX invested in them, they would definitely be able to create fashion that could conquer the market in China and could show their true talent and capability as designers. Now, for each partner designer, the time has come to prove your ability. YMYX is currently in the process of realizing our promises, and we do not need any designer to invest one cent for the cost of the sampling, production, the promotion and marketing both online and offline in our territory, for each of our partner's brands. We will present your brand authentically, and without reservation, to this huge market of billions of consumers. At the same time, each partner designer, just like Gianluca Soldi above, can shoot photos of their samples after they receive them physically, and they can display these photos on their own websites, social media or e-commerce and start to sell these shoes in their own markets immediately. In fact, these images featured above were taken by Gianluca himself. Other than in China and the surrounding Asian markets, which are part of the territory of YMYX, Gianluca can take orders and make sales for his shoes from consumers in any other market, anywhere else in the world, through his own e-commerce or website or Instagram. In fact, he can choose to start selling in other territories already now that he has the photos from the sample, even if we haven't started yet to sell in China and the Asian market, because of the delays caused by the virus. Under these circumstances, for Gianluca and for every partner designer, YMYX pledges that you do not pay any money for the actual sample itself, and when it comes to the profit that you as a designer generate from these sales, as long as these sales happen outside of our territory, YMYX will not charge the designers one cent from your profit earned either. As a result, if you really do possess that talent that you say you have, but you have not put it fully to use because of a lack of resources as many of you said, then it is truly the time now to realize the dream of achieving your fashion brand's success. No matter if it is in China or surrounding Asian markets, or the European and American markets, with YMYX's help, you will indeed be able to present your fashion vision to your brand's consumers now, without cost to yourself. At the same time, I want to say that in order to prove your ability, and for you to succeed, what you need is to be recognized by the market, not by YMYX. If in the future, your collection is not recognized as a good one even in Europe, then please do not bring those designs before the Chinese consumer, because it will have even less chance to succeed there. As I have always said - we provide to each designer a stage; we can turn on the lights, the music, provide the props, but we are not the performer. The designer is the one performing, and you're the most important figure on this stage, without your strong presence upon that stage, even if it were the best staging in the world, it would be meaningless. At the same time, even the best stage wouldn't help you succeed if it stands without your unique, luxurious fashion point of view that you create with that talent inside. But if you can perform a magnificent "dance" upon that stage, then I do believe that for each partner designer, we open up for you a door with limitless possibilities. We believe that if we take your designs and they are in fact very competitive designs in this market that consumers will fall in love with, and if we match the design to high quality production from Italy, Portugal and Spain, and at the same time we use high quality fabrics, leathers and other materials, also sourced from Italy, Portugal and Spain, then we may not be able to promise that you will become a famous brand, but your potential earnings, would be stunning. Many designers were very excited and told me that they had ideas for big collections with hundreds of styles. Several footwear designers, for instance, told me that based on one main structure, they could come up with hundreds of variations in color and material, to conceive a collection. Even if we do not yet consider collections of several hundred styles, if we for instance, considered a collection of 100 styles, and we take the example of a footwear line, with myriad styles ranging from classy and elegant, to sport and trendy, some with the classic stiletto shape and others with chunkier heels and even sneakers, as long as the collection's designs are unique, and luxurious, and we use very high level materials and the best craftsmanship in European laboratories that work also for the important luxury brands in Italy and France, and we present this combination and sell to China and the surrounding Asian markets, I trust that we can achieve a very impressive number in sales. Why do I say this? Let us consider that there are at least 100 major metropolitan cities with more than 1 million people in population, that exist in China and the surrounding countries and regions in the Asian market. Some of these cities have populations dozens of times greater than the city of Milan, others are about the same size as Milan. This also includes those mega-cities like Shanghai, Beijing, or Tokyo, Hong Kong and Seoul and others, with far greater population. If you have a footwear collection of 100 styles, and each style sells only 1 pair of shoes, per month, in each of these major metropolitan cities, then that would be in total, 100 styles x 1 pair of shoes = 100 pairs of shoes sold in each month. Now, with 100 cities as we just described above, that would be 100 pairs of shoes x 100 cities = 10,000 pairs of shoes sold, each month. If we then consider one year's worth of sales, that would be 10,000 pairs of shoes sold per month x 12 months = 120,000 pairs of shoes sold in a year. But we believe that with such high level fashion design, it would not be possible that for each style of shoes, it would sell just 1 pair per month, in each of these major metropolitan cities that harbour more than 1 million residents as we calculated above. This is because we trust that our marketing strategy and the brand strategy that we build, would help to generate a huge amount of brand influence and also consumer demand. If we return to the example above, let's assume that we are able to get to where each style in the collection of 100 styles, on average, can sell 1 pair of shoes per day, in each of these cities, rather than 1 pair of shoes per month. Why we use an average is because perhaps some styles are selling 10 pairs of shoes per day, while others are only selling 2 pairs per day, and still others may sell zero pairs per day. In this case, the brand would sell 100 styles x 1 pair of shoes per day = 100 pairs of shoes per day. At 30 days in the month, that would be 30 days x 100 pairs per day = 3,000 pairs per month, again in each of these cities referenced above. In 100 cities then, that would be 3,000 pairs of shoes x 100 cities = 300,000 pairs of shoes per month, and in a year, that would amount to 300,000 pairs of shoes per month x 12 months = 3.6 million pairs of shoes sold annually. Moreover, we feel that it would not be a very difficult thing to achieve, to sell just 1 pair of each style per day, in cities of such scale. So the main point is, can your designs conquer this market? If any designer must ask me, exactly what kind of design, what kind of products and style, exactly what kind of collection is it that can succeed, I will say that your designs and your collection must be able to hold their own amongst the designs presented in the various shop windows that line the glittering streets of the Quadrilatero della Moda in Milan, or Rue Saint-Honoré of Paris; and if your designs had their own space in the visual merchandising displays in the shop windows there, it would attract the attention of passerby, they would stop and look on with curiosity, with real interest, and not let the consumers feel that these designs could be seen almost anywhere, that they are commonplace. If you can achieve this, then I believe that your brand can succeed. Please understand that what we are offering to the consumer are designs that could stand toe to toe and compete on aesthetics with the designs of the big luxury brands. Your designs need to compete on that level and not with the likes of Zara or other mass market, fast fashion brands. I also hope through writing this letter to once more express YMYX's point of view, that our interests are aligned with each of our partner designers. We hope that you will succeed, and we hope that your brand can conquer the China and surrounding Far East market. To help you achieve this conquest, we are willing to invest fully. However, if your designs simply are not competitive in the market, then no matter how much we invest, we still will not succeed. At present, there are hundreds of factories from Italy, Portugal and Spain who are all waiting to be approved as a potential production partner for our project. Many of these factories produce for brands like Versace, Gucci, Armani, MaxMara, and other significant labels, and when we show these potential factory partners the designs of our partner designers they will refuse to work on certain styles that they do not believe befit their craft, since they are very proud of the work they do. They feel that if the styles are not competitive, then the brands will not succeed, and in the future, that means they will not have big volume orders to work on. Sometimes, their feedback is blunt - they will directly say, not only do they not feel inclined to produce those uncompetitive styles, but that they do not even believe that YMYX should support the brands who create those styles, because they are so commonplace that even in Italy, and the rest of Europe, they would not sell well. That's why I hope that all of our partner designers will take their design work seriously. The factories that we are approving predominantly do not work with fast fashion; there are some who have taken orders from Zara, in small amounts or limited capsules, or have done so simply because orders for the luxury labels have dried up in this period and they switched gears to keep the factories going. But these factory partners have a lot of history and high expectations for the brands they work on, and I do believe that each partner designer also hopes that they will have the chance to have their creations made by factories like these. For YMYX, and also for our partner brands, it is our honor to be able to work with factories of this caliber. Many factories who are in cooperation with us, also told us that they were very willing to work with YMYX, because they trust that YMYX will bring them a very big volume of orders. They said that if it were not for YMYX, however, they would not be willing to help small brands create samples, because smaller brands have a scale that is simply too small, and in the future, there also won't be orders that result from these samples. At the same time, a lot of designers also confirmed with us the same circumstances during our in-person meetings, which is that in Italy, also in Spain and Portugal, a lot of factories were not willing to help them create samples, because even if they were able to make production orders, the volumes were inevitably very small. Some also shared that even when they agreed to make samples and production for them, when the factories started to get busy during the peak seasons with their big name-brand clients, they would end up pushing the orders of the smaller brands to second priority, delivering for the big brands first and then delaying and delaying, until it was nearly the end of the season, sometimes even receiving their production only after the season has basically ended and causing the designer to miss the sales cycle entirely. As a result, we hope that each designer will really treasure this opportunity to work with these factories in our partnership. In the process of creating these sample tests, the owners of each factory, down to the technicians, have each been fully cooperating with our partner designers, and have been operating with fast speed and responses. They have treated our brands like their first-tier clients, from the management through to technical staff, taking time and attention to satisfy the brand's needs. As our partner designer, then, I hope that you can really unleash your talent, and when it comes to the communication, also use a really smooth and collaborative attitude to get the work done. My letters are always quite long, as I always hope to express my point of view very clearly to each of our partner designers, and I also hope that through this one you have been able to truly understand the market's demands, and YMYX's point of view. We believe that in China, and in the surrounding Asian markets, no one knows your brand yet, but we have confidence, and we have the ability to go and conquer this market together with you. We also trust that you would agree that this is our mutual goal, and our mutual dream.


Kate Chang

CEO

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