Knitted Fabric,Polyester Crepe Fabric,Double Knit Interlock Fabric,Thick Knit Fabric Shaoxing Xiaotrain Imp.&Exp Co., Ltd , https://www.xiaotrain.com
Brand ITAT reputation sweeping staff selling stocks to pay wages
Since its launch, ITAT was once celebrated as a groundbreaking success in China's fashion and retail sectors. However, the company has recently faced significant challenges. Since August of this year, ITAT has struggled with financial difficulties and internal management issues. The company has begun to default on payments to suppliers and has even failed to pay some employees' salaries on time. As a result, numerous stores across the country have either closed or been relocated, marking a dramatic decline for what was once a rising star.
On the afternoon of November 5, outside the Jinan World Shopping Garment Wholesale Plaza, more than a dozen ITAT employees were trying to sell clothes to passersby. An employee surnamed Liu explained that they all worked at the ITAT store on the first floor of the mall. Because they hadn't received their wages for two months, they decided to sell the inventory to cover their salary needs. "This is the company headquarters," Liu said, adding that selling stock to pay wages was a last resort. "The head of the Jinan branch is nowhere to be found. We’re now directly communicating with the Shenzhen headquarters."
It was also revealed that the clothing inventory being sold by employees had previously been stored at the World Plaza to help cover unpaid rent. According to reports, ITAT employees are no longer allowed to ship out the sealed goods. A senior executive from the plaza, surnamed Wang, stated that ITAT owes them rent and both parties are still in negotiations.
According to ITAT staff, there are two member stores in Jinan: one at the World Plaza and another at Qiaokou, which is currently operating smoothly.
**The ITAT “Fast†Model**
ITAT quickly gained popularity through its innovative and lightweight business model. However, upon closer examination, the company’s approach had several critical weaknesses.
First, its brand culture lacked depth. ITAT used English and Pinyin names for over 100 brands, but none of them were well-known fashion labels like YSL or CHANEL. These were just registered trademarks, yet ITAT claimed they were long-established international brands.
Second, product quality suffered due to rapid expansion. While an unknown brand could potentially succeed like ZARA, ITAT’s fast-paced growth led to poor quality control. The company focused on expanding store locations rather than ensuring product standards.
Third, ITAT’s store locations were often in less desirable areas, such as the outskirts of shopping districts. This strategy aimed to utilize underused commercial spaces, but it also limited customer traffic. Some experts criticized the model, suggesting that ITAT convinced suppliers to stock shelves, but failed to effectively promote sales. One person even joked that ITAT’s business model was simply "selling substandard products where no one else would."
Although the ITAT model was initially viable—enough to attract investments from Blue Mountain Capital and Morgan Stanley—it ultimately collapsed due to aggressive expansion and speculative capital use. Facts show that while figures like Li Peng and Ou Tongguo may have been quick to accumulate wealth, true innovation and long-term success require honesty and dedication. For businesses, staying grounded and focusing on sustainable practices is essential.
Prev Article
Black clothes on the streets of Stockholm