Hundred Round Pants Industry Break Through The Main Board &Nbsp; Rely Heavily On Franchising Business.

In September 16th, another chain clothing enterprise Shandong hundred round pants industry chain

It is worth noticing that since the first half of 2011, Shandong's clothing, Vigna S's clothing, Zhuhai's dress company and four fashion costumes of the Zhuhai fashion company have been attacked by IPO.

Clothing chain enterprises rely on franchisee sales to achieve business revenue, and its revenue confirmation authenticity has been subject to market controversy.

People close to regulators said to reporters: "regulators are vigilant about the authenticity of listed companies' sales data, and are reminded that they are concerned about the purchase of large quantities, whether the supply and marketing of major customers are marketization, and whether there is any manipulation.

Among them, the two major concerns of regulators are: one is the scale of self owned stores, and the other is the rapid expansion of risks in the short term, specifically referring to the fluctuation of pre market performance and number of stores in chain operated companies.

The reporters found that in these two aspects, the industry of 100 circles trousers all had contact lines: their dependence on the franchising business was serious. As of the end of 6 2011, the number of stores in the company accounted for 94.99% of the total number of stores. In addition, only 2010 years, the number of stores in the company increased by 3.5 times compared with the beginning of the year.

In addition, the reporter found that more than 270 million yuan was used to open 220 direct outlets in the nearly 295 million yuan investment projects thrown in the 100 round trousers industry, but due to the establishment of Direct stores and

Join or rely on early warning indicators

The reporter learned from the investment bankers that for the consideration of controlling profits by the franchisee, the regulatory authorities are particularly concerned about the two aspects of franchised stores and the risk of short-term expansion.

"In the final analysis, whether there is a false sale", the above close to the regulators said, "for chain operated enterprises with channel based business models, they will require all dealers (stores) to be checked in principle. At the same time, it is suggested that insurance agents should make use of information system verification. If the business customers are more centralized, they are required to make field trips to their main customers."

It is reported that the number of sales terminals and the proportion of self run (direct) store sales will be the main concern of the regulators for the future clothing chain enterprises planned to be listed.

The pre disclosure data of the hundred round trousers industry show that they are right during the reporting period.

In addition, during the reporting period (2008-2011 June), the proportion of franchising business accounted for 99.83%, 98.38%, 95.87% and 91.41% of the total sales terminals respectively, although it showed a downward trend, but accounting for more than 90%.

What is fishy is that the proportion of companies joining the company suddenly dropped after 2009, mainly due to the sharp increase of 63 Direct stores in 2010, which is 3.7 times the number of Direct stores in early 2010, and the large-scale opening of stores also resulted in a rapid increase in the proportion of the direct business of the company, which rose from 1.62% to 4.13%.

In sharp contrast to the above situation, in the 2008 and 2009 years ago, the number of direct outlets increased by only 7 and 9 per year, while the number of direct outlets increased by 8 in the first half of 2011.

In this regard, the hundred round pants industry explained that the sharp increase of Direct stores was mainly due to the fact that in 2010, when shareholders were asked to solve the related paction problems, the company chose 39 of the 54 franchised stores that had stable passenger flow and better management, and reopened the direct outlets on the original site.

However, even if these 39 outlets were newly built, the number of outlets increased by 24 in 2010, far exceeding the number of shops opened in other years during the reporting period.

It is worth noting that the relevant departments of the securities and Futures Commission two times this year.

In addition, another indicator, the size of the company, is concerned by the regulators. Compared with the first half of the year, Semir clothing, Busen shares and nine clothing companies 3 clothing chain businesses are also listed.

The largest is Semir clothing.

Semir's clothing revenue in 2010 was as high as 6 billion 287 million yuan, and net profit exceeded 1 billion yuan. In 2010, the main revenue and net profit of nine Mu Wang were 1 billion 675 million yuan and 361 million yuan; even the smaller Busen shares in 2010 accounted for 537 million yuan and 42 million 160 thousand yuan respectively.

In contrast, the hundred round trousers industry is similar to that of wagnath, which was applied 2 months ago. In 2010, the main business barely scraped through the 400 million yuan mark, and the net profit also reached 43 million 440 thousand and 800 yuan. The previous 2008 to 2009 net profit of the company was only 21 million 11 thousand and 700 yuan and 28 million 525 thousand and 200 yuan.

Vigna S said that in 2010, although he realized 313 million yuan of main revenue and 53 million 740 thousand yuan net profit, its revenue in the first two years was only 141 million yuan and 200 million yuan, and its net profit was only about 20 million yuan.

220 expansion risks

According to pre disclosure, 100 round trousers industry intends to issue 16 million 670 thousand shares, raising 295 million yuan for marketing network construction and information system construction projects respectively.

About 270 million yuan will open 220 outlets in eight provincial capitals of Changsha, Nanjing, Taiyuan, Nanning, Zhengzhou, Hefei, Lanzhou and Guiyang. It is estimated that the annual sales revenue will be about 375 million yuan after the project is completed.

Reporters noted that in the eight provincial capital cities to be opened, Changsha, Nanjing, Taiyuan, Zhengzhou, Hefei and Lanzhou are the main franchisees of the company.

With the growth of the investment projects in the future, the sharp increase of Direct stores will be in conflict with the old franchisees.

Because the company's trousers products are mainly oriented to the 25-55 year old middle income group of consumers in the 234 tier cities, and the main strategy is low price, the overlapping market will be overlapped.

At present, the number of franchisees in Hunan, Jiangsu, Shanxi, Henan, Anhui and Gansu provinces in these six cities has reached 47, 99, 136, 144, 65 and 48 respectively.

The company also acknowledged the risks of the above projects.

This means that even if the company is successfully listed, there will be a slight profit or even a loss due to the opening of new outlets, resulting in the risk that its post market performance can not grow at a high speed.