XTEP Fears Nike Will Enter The Two Or Three Tier City At A Low Price.

He Ruibo, executive director and chief financial officer of XTEP, said that for NIKE to enter the two or three tier cities, this is not a general direction. If NIKE is to make relevant arrangements, XTEP will only regard it as another local brand competition. In the second quarter of this year, XTEP's distribution shop recorded a growth in the same store sales with high number of units, which is better than the low single digit increase in the first quarter, while the annual growth target for same store sales is in the unit figure.

Earlier on, Nike intends to launch footwear products of 200 to 300 yuan in the mainland to enter the two or three line city market. He bluntly said that Nike has been developing in the mainland for more than 10 years, and has always been aware of the demand of mainland consumers for high-end products. It also understands that low-end products are not the source of profits for Nike. Therefore, it is not considered that the two or three tier cities are the main direction of Nike, nor will they sell too many products at the preceding price. If Nke makes the deployment, XTEP will only regard it as one more local brand competition. At present, local brands have more advantages in two or three tier cities. On the one hand, the market is more familiar with local brands. On the other hand, the relevant brands have already had a sound distribution network in related markets.

According to Hongkong media reports, He Ruibo, executive director and chief financial officer of XTEP (1368), pointed out that in the second quarter of this year, the number of sales of the same store with high number of units was higher than that of the first quarter, while the annual growth rate of same store sales was in the number of units. He also expects that the average price of the products will increase in the next spring order, and the clothing products are expected to increase by 5 to 10%. He also expects that in the next 3 to 5 years, the mainland's overall market will grow from 15 to 20%, and it is confident that the company's development will outperform the market.

Earlier, the industry engaged in production in the mainland raised wages for employees. He pointed out that production workers in factories are the main selling objects of the company's products. When their wages increase, the impact on XTEP is positive. At present, only 50% of XTEP's clothing products and 10% footwear products are self produced, while the rest are produced by outsourcing, and wages only account for 5% of the cost of sales.