Audrey Wu
Known for its high-energy style and low-range prices, 12-year-old retailer Metersbonwe is now among China's largest casual clothing retailers. But executives say the company strives to do far more than increase revenue and build market share. Vice President Wang Quangeng (EMBA02) gives The Link an inside view to the company's extensive employee welfare and CSR initiatives.
Wang Quangeng, the energetic vice president of Metersbonwe, walks briskly into the lecture room - an amphitheatre equipped with ultra-modern video conference equipment. Sunshine pours through the wall-sized windows, lighting a discussion area arranged with comfortable sofas. Inside the classroom, a staff of first-class interpreters prepares for the coming lecture.
Welcome to Metersbonwe College, located at the company's Shanghai headquarters. In this classroom, the "students" are all company employees, while the lecturers consist of outside professors and top executives. This afternoon, Wang (CEIBS EMBA02) will lecture a group of 40 employees on supply chain strategies.
Such professional development classes are one of the perks available to employees at this private Chinese company that now reigns as one of the nation's leading clothing retailers. Metersbonwe operates 1,800 retail outlets in 1,000 Chinese cities. The company rang up RMB4 billion in sales last year, achieving an astounding annual growth-rate of 90%. In terms of volume, the company's bustling shops are selling clothing at an average rate of three garments per second.
By all accounts, Metersbonwe has developed an impressive retailing business based on its image as a young, energetic brand with trendy products priced at mass-market levels. But as Wang Quangeng tells The Link, the company seeks to do more than gain market share and boost profits. Wang says one secret to success is the company's focus on employee welfare and social responsibility programs - projects that improve employee loyalty, satisfaction, and performance.
Free Speech
Everyone loves a hobby, but Metersbonwe President Zhou Chengjian has a peculiar pastime. Zhou spends his pre-work hours logging on to the company's employee BBS to listen in to online grumbling or suggestions. The company operates a BBS for direct employees, another for factory suppliers, and another for franchisees. BBS users write under pen names, allowing them to speak freely while being read by top executives. Employees are also encouraged to express their ideas in staff meetings and via the internal Metersbonwe Newspaper. The goal with all these communication channels is to encourage company personnel to openly discuss and resolve issues.
At Metersbonwe, employee satisfaction is a concept that permeates the corporate culture, says Wang Quangeng. As an example, he points to the two-day, RMB5 million gala recently thrown for all 1,000-plus direct employees and their families. The lavish event, now a part of corporate lore, is a source of pride for employees who attended.
The emphasis on employee well- being traces back to the company's launch in Wenzhou, says Wang, and is part of company history and culture. For example, the Shanghai headquarters includes a "cultural corridor" displaying photos of employee teambuilding events. One exhibit shows photos of a young Wang Quangeng and 19 other top employees receiving a good service reward in 1997. As their gift, all 20 received a new apartment, personally purchased by company President Zhou Chengjian.
Today, Metersbonwe has earned a reputation for offering attractive salary and benefit packages, an ultra-modern work environment, and attractive employee welfare terms. In addition to national holidays, employees enjoy generous vacation and personal leave terms, full insurance benefits, as well as monthly employee celebrations and outings. Perhaps most popular among employees is the company's policy of offering all direct employees and even supplier personnel - from blue-collar workers to top executives - comprehensive career development training. At the Metersbonwe College, the company offers a range of professional development classes including technical training, English classes, and computer skills. Executives above the department head level can apply to attend one of seven China-based business schools, including the CEIBS EMBA program.
These practices follow what Wang Quangeng describes as the Metersbonwe definition of corporate social responsibility. "Social responsibility involves many dimensions, such as what the company can do for the employees, their families and the community," he says. "What links employees to the company is more than an exchange in which they work and we pay." He says the company benefits measurably from practices that place employee welfare first. Most importantly, Metersbonwe boasts a low annual employee turnover rate of 5% annually, compared with rates of 15% to 30% at many companies in Asia. In addition, such progressive policies have boosted the company image, helping the company to win public recognition. In 2005, the company was voted the Favorite Clothing Brand for Young People by China's Central Committee of the Communist Youth League of China and All China Youth Federation. Last year, company CEO Zhou Chengjian was named Best Business Leader by CBN and CNBC TV groups.
Across China, more than 200 million consumers now own Metersbonwe apparel, and counting. The company produces 20,000 different products per year using a strategy of inhouse design and marketing, outsourcing manufacturing and franchised retailing. Given such a model, maintaining quality control poses serious potential problems. The solution, says Wang Quangeng, has been to establish a highly efficient IT platform to track and monitor production, from order placement, to wholesale purchasing, to distribution and retail sales. In addition, the company strives to instill its quality standards among suppliers. Metersbonwe spends about RMB30 million on quality control per year, mainly through partnering with manufacturers. "What holds Metersbonwe and its manufacturers together is a win-win prospect," says Wang. "We never take advantage of them. Instead, we see to it that they maintain a very good profit margin." Over the past 10 years, the company has developed a network of factory suppliers in Jiangsu and Zhejiang provinces, providing them with training to enhance their management skills. This network now represents many enterprises with assets exceeding RMB100 million.
Another aspect of the company's quality control is the use of remote-controlled videotaping across the 20 flagship stores nationwide. These video images are viewed real-time at the corporate headquarters, allowing executives to observe how products are displayed, how salespersons interact with customers, and how customers respond.
A Different Path
One of the more unusual features in the Metersbonwe headquarters in Shanghai is the Museum of Clothing. Occupying more than 2,000 square meters and displaying 5,000 items of apparel, the museum displays the clothing of different ethnic groups in China through history. "There is no similar museum in our country, except for the Beijing Institute of Clothing Technology," explains Wang. Although the museum is now only open to invited guests, the company plans to eventually expand it into China's largest clothing museum.
Supporting a museum is a fitting project for a company whose corporate motto is: "follow a different path." Wang explains that such social outreach projects help define the company's corporate culture. Another aspect of the corporate goal of unconventionality is its support of charity programs. During Spring Festival of 2002, for example, the company donated RMB2 million-worth of high quality winter clothing to poverty-stricken Chinese. In March 2004, the company donated RMB10 million to the Zhejian Young People's Development Foundation, and that fall also spent RMB1 million to develop the Metersbonwe Perfection Public Scholarship, giving financial aid to low income grade-school and college students. Meanwhile, popular Chinese-language TV show My Hero, produced by SMG and sponsored by Metersbonwe, also added a CSR element this spring. In April, organizers of the show, which features aspiring Chinese singers, announced plans to donate to charity all earnings derived when viewers cast votes for favourite singers via text message.
Funding charities is one external expression of Metersbonwe's commitment to CSR. Today the company is also striving to develop internal CSR practices, creating not just good employees but also good citizens. For example, the company actively supports the central government's campaign promoting "Eight Virtues and Eight Shames," encouraging people to love their country, serve the people, uphold science, work hard, cooperate, be honest, be disciplined, and live simply. Says Wang, "I think these virtues are actually the basic principles of a good citizen. If people can follow these, then they are also qualified to be good employees.
Looking over the company's successes during the past dozen years, Wang says Metersbonwe has come a long way since the company was founded using assests of just RMB5 million. Today, the company's goals are quite ambitious: to acquire RMB10 billion in assets by 2010, then to become a world-renowned brand. Meeting these goals will require overcoming serious challenges in management, marketing, manufacturing and IT control. Wang remains confident, however, that Metersbonwe will succeed; he says the social responsibility qualities that make the company different also provide the fuel that drives it forward.
Company President Zhou Jiancheng sums up the Metersbonwe philosophy in this way: "The fulfilment of one's life is not how much he or she possesses, but how much he can contribute to society. This belief encourages me to overcome all hardship and difficulties and to try my best to expand the company. Thus, I believe that the enthusiasm to serve society is the true source of energy for an enterprise."
