PEAK'S Rural Encircling The City Is Heading For The First Tier Cities.

The difference between domestic sports brand and foreign brands in terms of comfort and quality has been very small. The only difficulty is brand.

Xu Zhihua said that domestic consumers still have superstitions about foreign brands, but fortunately this superstition is being gradually broken.

"The first quarter of 2009, the domestic brand Lining has surpassed Adidas, and the era of Chinese brands is coming soon."

Xu Zhihua said.

Since its inception, PEAK has been positioning itself in the brand strategy of high rising and high hitting, starting from CCTV and Hunan satellite TV, and carrying out comprehensive cooperation with NBA in endorsement. In marketing strategy, PEAK has adopted the strategy of "encircling the city by the countryside", first cut through the two or three line cities, then gradually infiltrated to the first tier cities, and gradually raised the unit price and partial product positioning.

In March 16, 2010, following the successful listing of Hongkong in September last year, Fujian sports PEAK released its 2009 annual report for the first time. The report shows that PEAK achieved sales of 3 billion 95 million yuan in 2009, an increase of 51.6% over the same period last year, and net profit increased by 67.1% to 628 million yuan.

Within a year, how did PEAK achieve a 67.1% increase in net profit?

This is due to PEAK's strategy of infiltrating the two or three tier cities into the first tier cities.

Unlike most of the moves to reduce profit margins, Xu Zhihua disclosed that the reason for PEAK's profit increase is mainly from the promotion of unit price, but the advantage of cost reduction is not obvious.

"From the current strategy, we still have much room for improvement in gross margin. In 2009, PEAK's gross profit margin increased 4.8% to 37.5% compared to the same period last year. This year, we will raise one to two points on this basis, and the gross profit margin will reach about 40%."

Xu Zhihua said.

PEAK has also substantially increased its R & D efforts. Currently, it has three product design centers in the US, Beijing and Guangzhou. It may add another one in Korea, Japan or Italy.

"R & D is the soul, and the contribution rate to sales promotion is very important."

Xu Zhihua said.

PEAK's investment in research and development has reached about 1% of the total investment, which refers to the cost of scientific research personnel.

　　先進城,再出國

Nike and Adidas are entrenched in the main cities of the first tier cities because of their brand advantages. PEAK and other Jinjiang Corps can only concentrate on the second tier cities, and then concentrate their strength on the first tier cities.

At present, Anta and PEAK have already had some competitive brands competing in the first tier cities and international brands.

At the same time, PEAK did not forget to play the marginal effect of sponsoring NBA and other international events, and actively enter the international market.

It is reported that PEAK's current overseas sales account for 1/10 of its total revenue, and there is still room for improvement. However, the domestic market has not yet stabilized, and its pace of overseas expansion can only be in the exploratory stage.

According to market research firm ZOU marketing, the annual compound growth rate of domestic basketball shoes from 2009 to 2013 is 15%. How to stand firmly in the increasingly competitive domestic market is also a challenge for PEAK. Its huge advertising and marketing expenses also bring pressure on its profit growth.

In the domestic brand, its popularity is lower than Lining, Anta, KAPPA, XTEP and 331 degrees, ranking sixth.

From the brand campaign, PEAK's combat mission is not easy, so the burden of its brand investment will not be eased soon.

According to the analysis of Hongkong Hui Ye securities, because the brand awareness is relatively low, it is necessary to give the distributor a higher discount, which will have an adverse effect on PEAK's profit margin.

In addition, the expansion of franchise network will also increase its accounts receivable and constitute unfavorable factors for cash flow.

Despite all these disadvantages, PEAK has worked out a plan for 10000 stores.

Xu Zhihua revealed that on the basis of the current more than 6200 stores, PEAK will achieve 10000 stores in three years.

Lin Bilian, director of sales, said that in 2010, PEAK will set up about 1000 sales outlets and 100 basketball products stores.

In addition, its market coverage has gradually expanded. Besides basketball, it has quietly entered a wider range of sports products, such as running shoes, tennis, football and so on.