Low price strategy
In the past, a kind of coarse cloth was produced in Shandong, which was popular among rural people for its durability and cheap price. It was through selling this kind of coarse cloth that Meng Hongsheng and his son accumulated their wealth. In this aspect, Wal-Mart has a similar motto in " Always low price, always": They always offer a low price on a full selection of products day in and day out. With this low price strategy, both Rui Fu Xiang and Wal-Mart succeeded in generating large revenues at small margins.
Could Rui Fu Xiang catch up with time?
The splendid past of Rui Fu Xiang has gradually faded over time. As a state-owned enterprise, it has sunk into stagnancy in the booming of a market economy. There seemed to be many reasons for its failure, such as state-owned are no longer protected by government, or people do not buy cloths to make clothes as they used to. Yet these are mere excuses. Rui Fu Xiang has to find its own position in the market to continue its existence.
Rui Fu Xiang represents a cultural tradition for Beijing and China. People still have much to do to protect this precious heritage.
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