According to Forbes, which ranks the world’s wealthy, there are currently over 200 billionaires in mainland China. An analysis of their many business interests reveals that as many as 40 of these are entrepreneurs and investors who can trace their fortune back to fashion — or who have fashion to thank for a significant part of it.
Measuring the personal wealth of the founders and leaders of a business may not be the traditional way of gauging corporate performance, but it can shed a lot of light on the machinations of a nebulous fashion industry like China’s.
“Most fashion billionaires started from the garment industry, but as their businesses grew, they started to get involved in real estate or other financial investment projects. This was especially true in the regions around Zhejiang and Fujian where garment enterprises couldn’t escape this pattern,” says Yu Lingyuan, fashion director of FHM China, a men’s magazine.
Take Li Rucheng, for example, who used to work in a collective factory in Ningbo in the early 1980s before being promoted to factory chief. Today, he is the billionaire chairman of Youngor Group, an enormous menswear manufacturing conglomerate that employs 50,000 people and has since diversified into property and finance.
“Compared to other industries, China’s garment enterprises could scale very fast through the distribution system and make their owners into millionaires in a comparably short period of time. Becoming a billionaire, however, is another matter — which is why they eventually need to turn to complementary investments,” Yu Lingyuan adds.
Li was not the only textile billionaire who worked his way up from the factory floor. Zhou Yaoting was toiling away at the Gangxia Knitting Factory 35 years ago when he persuaded some of his fellow factory workers to pool their money to buy stocks of the factory which would later anchor his conglomerate, the Hongdou Group.
Read more at Business of Fashion.