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Lining, Moving Inventory Door, Market Trend Or Marketing Strategy?

2011/8/6 10:35:00 87

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Recently, Lining The company announced repurchase of inventory, which will spend nearly 300 million of the total business. Coincidentally, the next day, the trend company also announced that it spent 200 million yuan to buy back. Stock 。 As soon as the news was released, the stocks of the sports section went down and the two or three line brands began to sell at a discount. Lining, who has just experienced the price increase before moving forward, is now deeply in the "inventory door".

Not long ago, Lining and other shoe companies increased the cost of raw materials and increased their cost for a small number of times. Price increase 。 Many domestic two or three line brands also take the opportunity to follow the price increase, resulting in some Chinese brand prices approaching the two or three line brand prices abroad. In China, domestic first-line brands can only compete with international second-line brands. The rapid upgrading of domestic two or three line brands will only cause consumers' dissatisfaction, and many consumers are turning to foreign brands such as Nike, Adidas and Puma.

The advantage of price increases is that the profits of individual shoes increase, but the disadvantage is that the consumers are dissatisfied. Because of the rising price of raw materials, the price increases are understandable, but too many enterprises that follow suit will cause a series of turbulence in the market. Many domestic two or three line shoe industry can not withstand market pressure or other reasons, prices rise and rise again, regardless of the real demand of consumers, and consumers will turn to other brands when the brand price ratio is not comparable to other brands, resulting in reduced sales. This is a vicious circle, and Lining soon got the bad result.

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Although Lining, the trend of buy back behavior is only to solve the market problems encountered by the two companies, however, there are still some people who doubt that it is Lining's market operation. So, is this a business strategy or a simple market phenomenon?

We know that Lining's initial price rise is due to the rising price of raw materials, and this is the reason why all shoe companies will encounter it. So when Lining rises in price, others will go up. However, Lining's sales terminals are relatively mature, customers are relatively stable, and the impact of price increases is not large. The other two or three brands of domestic brands have a relatively large price increase. Therefore, these two or three line brands may be holding the idea of following the trend of rising prices, causing prices to rise and rise again, causing consumers' dissatisfaction. The inventory left behind by the price hike is particularly high at this time, especially now that it is at a critical time - the summer, autumn and winter orders will be held soon. If we do not solve the inventory problem as soon as possible, we will have a negative impact on the later marketing strategy. Therefore, Lining, the trend of stock repurchase is a normal phenomenon in the market.

In this regard, Hou Zhaohui, vice president of 361 degrees, also said that this is a normal market phenomenon, although some enterprises will be affected, but little impact. The price rise before 361 degrees is just a rise in the dealer price. The price rise at the sales terminal is not obvious and will not be affected. Moreover, vice president Hou Zhaohui pointed out that this inventory door is not without precedent. When Adidas was misjudged in the Olympic Games, it was deep in the stock door, but it recovered in a short time. This shows that the impact of such emergencies on the industry will not be too great. Generally speaking, it will only cause a short time, and it will return to normal in about 3 months.

In short, Lining, the trend of this inventory crisis seems to have no imagination of bad, the impact is not expected. Many enterprises will be able to get through it safely, and the market will not fluctuate very much.