Me&CITY And Metersbonwe Have Ambiguous Positions.

Facing the upcoming autumn and winter clothing sales season, before the promotion of Me&City in all parts of the country "hoarding" led to a sharp decline in performance, the United States should take this opportunity to reverse the operation.

　　 Smith Barney Apparel said that since the second quarter of 2010, the company's product development capability has been improving. terminal Service management has been continuously strengthened, and direct stores have been steadily increasing compared with revenues. At the same time, the performance of the franchise market has increased rapidly, and consumers' recognition of autumn products has been improving. With the coming of the autumn and winter sales season, the company's future performance will grow rapidly.

In the semi annual report, it is estimated that net profit will increase by 0 to 20% over the same period of 1~9 months, which means that the performance will return to growth for the first time since last year.

ME&CITY medium-term benefits reflect growth or return to date.

In 2009 1~9, the net profit of the company was 299 million yuan. In the first half of this year, the net profit of the United States was only 40 million 336 thousand yuan. If we want to make the performance return to growth in the three quarter, the United States should reach at least 259 million yuan in the three quarter. Net profit 。

The move has attracted the attention of the industry. Recently, a number of agencies including China Merchants Securities, UBS Securities, CITIC Securities and other agencies have gone to the research of Smith Barney clothing and released research reports in mid August.

From the reality of the semi annual report released in the evening of August 17th, the United States has achieved 2 billion 540 million yuan in business revenue in the first half of the year, an increase of 39% over the same period last year. However, since the beginning of this year, the United States has increased its direct store construction since the beginning of this year, the rapid expansion of new store expansion costs, and the increase in the first quarter's cost than the increase in revenue. The decline in gross profit margin and the decrease in financial subsidies caused a 83% decline in net profit in the first half of this year, which was 40 million 336 thousand yuan.

According to the China Daily, the sales cost of the company increased by 53.28% in the first half year to 875 million 40 thousand yuan, an increase of 304 million yuan compared with the same period last year, and the management fee increased by 40.34% compared to the same period last year, which was 107 million yuan.

Despite the serious decline in the first half of the year, the huge investment spent before promoting the direct brand Me&City was rewarded in the first half of this year.

From the composition of the main business of the company in the first half of the year, the company's direct revenue increased by 53% over the same period last year, and the ME&CITY brand's revenue in the first half of the year was 243 million 111 thousand yuan, an increase of 112% over the same period last year. The proportion of the total revenue from the previous 1~6 rose to 6% of the current period 10%.

Dongxing securities analyst Yin Guohong believes that the construction process of the new brand Me&CITY is in the middle of the three year brand cultivation cycle, and most of the single stores are in the middle of a single store cultivation cycle. Judging from the effect of brand building, the new brand realized 240 million of its huge revenue in the first half of the year, which shows that the brand is now well aware of the two or three terminal cities.

After 9 months of hard work, the new brand Me&CITY began to return to profitability, but Yin Guohong, an analyst with Dongxing securities, believes that Me&CITY is in the middle of the three year brand development cycle from the construction process of the new brand, and most of the single stores are in the middle of a single store training cycle a year, and there is still a long way to go before they come.

As a typical light asset enterprise, Smith Barney has always pursued the strategy of R & D, brand ownership, production and channel outsourcing. However, since IPO, the US state clothing with its capital has begun to shift its focus to the direct business. In order to create a new brand, Me&City is willing to expand the number of Direct stores and purchase real estate stores.

In addition to the strategic readjustment on the subjective will, there is also a view that the rapid expansion of international fast fashion brands represented by ZARA and H&M has accelerated the pace of accelerated expansion of the US state garment and led to a sharp increase in its expenditure.

In order to compete with these international fast fashion brands and promote the new brand Me&City, Mei Bang apparel has adopted a profit making strategy since the end of 2009 to the first quarter of this year, resulting in a 2.6 percentage point decrease in the gross profit margin of the company in the first half of the year compared with 45.6% in the same period last year. The gross profit margin in the first quarter of 2010 has dropped to a low of 37%.

However, the profit sharing strategy does not change the performance of the other Me&City brand, but has a negative impact on the brand image.

Dongxing securities analyst silver Guohong research report pointed out that "the first quarter of this year, the company's profit sharing strategy not only affected the current performance, but also a certain damage to the brand image, the impact needs some time to repair."

Me&CITY and Metersbonwe have ambiguous positions.

For the ME&CITY brand, in 2009, the brand marketing and channel construction have been a very big investment in the brand marketing and channel construction. By the end of 2009, the ME&CITY brand owned shops and cabinet more than 80. According to the data, in 2009, the cost of 820 million yuan was bought and leased, and the cost of decoration was over RMB 50 million yuan.

In addition, in order to promote direct brand ME&CITY, Mei Bang apparel made a drastic adjustment at the end of 2008, divided Metersbonwe and Me&City into two major departments and operated independently.

However, it may not be expected that the first quarter of 2010 after the huge investment over the past year, the United States has made a net profit decline of 90% over the same period. Although the business situation of the direct store brand Me&City has improved in the two quarter, but the heavy investment in the past year and the lack of experience in the decision-making team and business team led to the 85.92% decline in the first half of 2010.

In fact, since the establishment of ME&CITY, brand positioning has been blurred with Metersbonwe.

As the complementarity and extension of the Metersbonwe brand, which focuses on the campus, Smith Barney wants to use ME&CITY to grasp the loyal young consumers who have been nurtured in the past 13 years in order to adapt to the growth of their age and the changes in their consumption habits and preferences after entering the workplace.

Metersbonwe locate in the 16 to 25 year old campus group. Me&City lock-in the target customers as 22~35 year old fashion oriented white-collar class. However, dividing customers by age has become outdated.

According to the China business newspaper, Professor Zhang Xinke of The China Academy of Art once said, "Me&City's product is only a little deeper than Metersbonwe, and it is" deep in design, good in fabric and fine in workmanship ". Many customers even treat Me&City and Metersbonwe as an equal view.

Because of improper positioning of Me&City, Mei Bang clothing has made many adjustments to the brand positioning. In its 2009 annual report, it frankly said that because of the constant adjustment and improvement of the positioning of ME&CITY brand, the investment was large, resulting in a significant increase in short-term expenses.

At the same time, ME&CITY is also involved in the fashionable fast fashion market. Wentworth, Miller, and the international model Branna trnojo, who are the most popular jailbreak heroes, are the spokesmen of the brand global image. Let the French designer Luc Bruno take the lead in building an international designer team, and claim that there are more than 3000 fashion styles every year, and complete the design, production, logistics and distribution of clothing in 70 days, etc., aiming to push ME&CITY into the fast fashion market that has been raging like a raging fire in recent years.

However, the reality is brutal, and ME&CITY is obviously at a disadvantage in the positive confrontation with Spain's ZARA, Sweden's H&M and Japan's UNIQLO fast fashion brands.

According to the relevant data, ME&CITY stores in the first tier cities are not able to pose a threat to the other brands, no matter from the number of consumers, the frequency of clothing fitting and the volume of transactions. ME&CITY is still not able to threaten other brands.

If ME&CITY can not find its own positioning, can not cultivate loyal consumers, just follow the fast fashion step forward, it will inevitably repeat the mistakes of Baleno. Xu Bin, a securities affairs representative of Mei Bang dress, once said that Me&City should learn from international brands, but the positioning of products will be different, and it will become clearer. Galaxy Securities analyst Mari believes that the company's performance is lower than expected mainly in the growth of revenue and the cost growth does not match, some of the costs are mainly invested in long-term development projects.