2011: Sports Apparel Business Growth Or Slowdown &Nbsp; Long-Term Prospects Are Still Worth Watching.

In 2011, agencies predicted that the growth of sports sector in textile and garment industry would be slower than that in 2010.

Hong Kong

Rising costs affect movement sector upgrading

Cotton prices have risen rapidly since 2010, especially in the second half of the year, when cotton prices rose more than 100% in the short term.

The state has introduced a series of measures to curb the excessive rise in cotton prices. Cotton prices began to fall after November 2010, but they are at a historical high.

It is predicted that in 2011, the gap between supply and demand of cotton is still as high as 3 million tons, and the supply and demand determines that cotton prices will still be difficult to recede in the short term.

The appreciation of the renminbi has led to export pressure.

After the two exchange reform in June 19, 2010, the RMB exchange rate rose sharply, although the US dollar index remained at a relative high level of around 80, the RMB exchange rate has hit a new high.

Labor costs are rising rapidly.

In recent years, after the Spring Festival, the phenomenon of "labor shortage" appeared almost every year.

In the early December 2010, two months before the Spring Festival, some coastal enterprises had already been embarrassed by the loss of old people and the difficulty of new recruits.

China's population structure determines that the labor cost of manufacturing industry will continue to grow at a high level in the future.

Because of rising raw material prices, rising labor costs and RMB appreciation are expected to remain in a longer period of time, brand manufacturers with stronger bargaining power deserve more optimism.

In terms of valuation, the apparel industry's earnings per share in 2011 is about 14 times. Considering the industry's expected growth rate of around 20% in the next few years, this valuation is quite attractive.

In many sectors of the industry, home textiles and men's clothing, which are in a growing stage, are more worthy of attention than the sports products that are gradually coming into maturity.

The Li Ning Co said recently that the order of Lining products will end in the second quarter of fiscal year 2011. The total value of orders calculated according to the retail tag price is equivalent to that of the same period in 2010, of which the average retail price of clothing products and shoes has risen by more than 8%, but the number of orders has decreased by more than 7% and 8% respectively.

The calculation group's impact on the dealer's wholesale discounts has been reduced by about 6% compared with the same period in 2010.

In order to "stabilize the morale" and help dealers cope with the pressure of rising costs, Li Ning Co said it would increase the discount rate to dealers.

According to its partners, Li Ning Co's original wholesale discount rate to dealers is 57% to 58%, and the adjusted discount rate will increase by 2%-3% to stabilize the dealer team.

In the coming year, for Lining's distributors and distributors, the survival of the fittest is indispensable.

China's trend is KAPPA brand, and the growth of orders in 2011 is much lower than market expectations.

2011 the order amount increased by only 2.8%, which is far below the market expectation.

In the growth of 2.8%, the unit price increased by 5.7%.

According to product category, shoes orders increased by 24%, clothing decreased by 2.8% and accessories increased by 6.7%.

Over the past few years, China's KAPPA brand's 2 quarter product has been popular with consumers because of its fashionable design and bright colors. Therefore, the Chinese trend finds that its dealers always tend to make more 2 quarter products.

From 2008 to 2010, China's growth in orders in the 2 quarter increased by more than 50%, 31% and 22%, respectively, higher than that in the same industry.

In 2010, the trend of China did not catch the change of consumers' taste in time, which led to the weakness of the retail market and the large inventory problem.

The order in 2011 will increase by 23%.

Orders for clothing and footwear increased by 10% and 8% respectively, while the average selling price increased by 12% and 13% respectively.

The annual growth rate of the mainland sporting goods market is still over 15%.

However, the growth of the first tier cities has slowed down, but the second and three tier cities still have a relatively high growth rate.

It has 7100 stores, and 70% of them are in the second tier and three tier cities.

And the order of 2011 increased by 23% compared with the same period in autumn.

Clothing orders rose 10% and footwear increased by 8%.

In terms of average selling price, clothing increased by 13% and footwear increased by 12%.

Li Ning Co has been affected by its expansion activities, and its main business is starting to go wrong.

In December 20, 2010, Li Ning Co's share price suffered a serious setback, and its market value decreased by HK $3 billion 500 million a day.

Immediately, Lining threw out a series of solutions, including integrating some poor performance stores, and promoting the growth of company's performance by increasing the sales revenue of single stores.

Although Lining did not publish the specific figures, the number of stores that Lining now has over 7000 stores and the drop in orders volume may reach 500-600.

This solution worries investors. Investors are worried not only about Lining's own business, but the beginning of a bottleneck in the Chinese sports apparel industry, which seems to have come to an end by increasing sales.

Previously, Lining management held a meeting, decided to carry out the integration of distribution channels in 2011, the main action is to turn off the poor performance of a single business shop, and then increase the discount store sales to about 10%, while the proposed wholesale discount of 3 percentage points.

But these measures have not rebuilt confidence for investors.

"Sports goods retail market is facing heavy pressure.

On the one hand, the growth mode that used to rely on a large number of new stores has been difficult to sustain. On the other hand, the cost of operating terminal retail stores is increasing, which makes Li Ning Co dealers more cautious about the growth prospects of the next year.

Li Ning Co CEO Zhang Zhiyong's remarks not only clarify the issue of the brand of the domestic sportswear brand, Lining, but also reveal the common character of this industry.

2011 will be an adjustment year for China's trend. China's trend management is expected to slow down in 2011 and profit margins will decline.

In 2011, the trend of China will focus on inventory management.

In addition, for the number of shops, the company's management believes that it will drop from 600-700 previously planned to 400-600.

The gross profit margin of the company is expected to decline as costs rise and the brand competitiveness decreases.

China trend chairman Chen Yihong met with his former boss Lining's problems, and how to make the slow down performance again explosive growth. He is expecting Sandrine Zerbib (Sang Delin), the former president of Adidas Greater China, to surprise him.

China trend announced recently that China's original CEO Qin Dazhong was replaced by Vice Chairman, and CEO was replaced by Sandrine.

Sandrine became the managing director of Adidas China in 1994. Under his terms, Adidas's business in China was out of nothing.

In 2003, Sandrine became the president of Adidas Greater China. After assuming office, she presented and promoted the partnership between Adidas and the Beijing Olympic Organizing Committee, and developed Adidas's China market to the second place after the US.

"Do you see why Adidas is so active in the two or three tier city? Why is there any doubt that the industry is going to die?" said Chen Yongling, director of capital operation at 31st degree. Although the operating cost of retail stores is on the rise, Adidas has always pursued a high discount strategy, and distributors and terminal retailers have larger profit margins.

Deutsche Bank reported that it is expected that the mainland's sporting goods sector will expand as a new profit growth mode next year, mainly due to the rise in costs and discounts, which will hurt the profits of the shops. It is expected that the retail growth of Lining and China's trend will disappoint the market, but Anta and second tier brands such as XTEP, 31st degree and PEAK will be stronger than market expectations.

China's economic growth in the past was mainly driven by exports and investment, but the proportion of consumption to GDP will steadily increase in the future, which means that the overall growth rate of consumption will be faster than the growth rate of GDP.

It is worth noting that the growth rate of textile and garment retail sales is faster than the total retail sales of consumer goods.

According to the National Bureau of statistics, the total sales volume of domestic textiles and clothing in 2010 1~10 was 458 billion 100 million yuan, up 25.1% from the same period last year, much higher than that of the total retail sales of social consumer goods.

On the fast track of consumption, textile and apparel are among the fast cars.

In 2010, China's per capita GDP exceeded US $4000. According to the experience of other countries, the per capita GDP is a rapid growth period of consumption from 3000 to 8000 US dollars. With the advance of the 12th Five-Year "plan" income distribution reform, consumption related themes will become a hot investment point for a long time.

At present, the expenditure per capita of sports apparel in China is still lagging behind that of developed countries. In the next 4 years, the estimated size of the sports apparel market will increase by 16%~18%, which reflects the favorable future for the development of the mainland sports apparel market.

As a sports enterprise, 331 degrees is a very good growth company.

In the year of 2010 (end of June), the number of stores in 331 stores increased by 872 to 6927 from the end of June 2009. The company plans to expand the sales network to 1 000 in 4 years.

On the other hand, the company announced that the total amount of orders increased by 20% over the same period last year, when the company held the spring and summer products distributors' meeting in 2011.

The number of shoes and clothing products increased by 15% and 11% respectively, and the average price of shoes and clothing products increased by 4% and 9% respectively.

In September 2010, a spring and summer series of children's clothing orders were held. The order value was about 130 million yuan, which was 3 times the first order meeting held in September 2009, reflecting the new business growth momentum.

The children's wear line has brought about an increase in the spring and summer which ended earlier than 31st degree, and the same store sales performance is also in the same industry.

On the whole, the sportswear industry is indeed a domestic demand industry with a good growth rate. However, there are many brands and fierce competition. It is the most important thing to win in competition. Advertising and quality are very important, and many unknown brands are ready to go public.

The listing of consumer stocks is important. After the listing, consumers can feel that the brand is a well-known brand and has a strong advertising function.