News Birds And Other Brand Clothing Enterprises Overweight Subsidized Dealers

This winter is a bit cold for the clothing market.

In order to protect

Recently, the company announced that the company intends to increase the amount of financial assistance to franchisees to help them have long-term and stable business premises and expand the scale of operation.

The specific plan is to provide financial support to the franchisees who are mainly supported by the company. The total amount of external financial assistance will be increased from no more than 120 million yuan to less than 180 million yuan, and the amount of financial assistance to a single franchisee will not exceed 20 million yuan.

For the behavior of financial aid dealers in clothing enterprises, Everbright Securities and Huachang securities textile and garment industry researchers agreed in an interview with reporters.

Among them, Qu Zhihang, a researcher at Huachang securities, said that the high price of brand clothing and the warm winter climate this year have a great impact on the current management of clothing dealers.

Combined with previous research on textile and garment enterprises in Jiangsu and Zhejiang provinces, it is easy to understand the original intention of the financial support for news birds.

Because of the tighter monetary policy in 2011, brand dealers as the weaker small and micro enterprises, it is very difficult to get financial support from banks, and their funds are generally in a tight state.

The objective fact that winter is late in winter and early in the Spring Festival has already caused accumulation of retail channel inventory, and also affects dealer cash flow, which makes dealers' goods booking and new store expansion tend to be conservative in 2012, thereby affecting the growth of brand clothing enterprises in 2012.

It is reported that the listed brand clothing enterprises generally have a more optimistic estimation of their brand prospects, but as the competition intensifies, brand clothing enterprises generally increase their funds and credit support to distributors.

The main forms of support include the reduction of the advance payment ratio of the order, allowing the dealer to postpone the payment of a certain percentage of the goods when the goods are shipped, and the shop decoration fee.

In this regard, Huatai Securities analyst Cheng Yuan believes that under the condition of a more prosperous terminal consumer market, clothing enterprises can increase the enthusiasm of dealers and enhance the efficiency of channel expansion by increasing financial support to dealers. However, if the terminal consumer market turns cold, the increase of accounts receivable will bring great effects to garment enterprises.

In the terminal sales boom, the construction of sales network can realize the expansion of brand clothing enterprises.

Take the bird for example, in the first three quarters of 2011, the company's operating income was 1 billion 331 million yuan, an increase of 49.06% over the same period last year. Net profit was 249 million yuan, an increase of 55.53% over the previous year.

At the same time, the company accounts receivable increased by 164.07% over the same period last year, and asset impairment losses increased by 235.65% over the same period last year, mainly due to the expansion of the company's operating scale during the reporting period, the increase in credit sales for outstanding franchisees, and the provision for the decline in inventory prices.

However, in the above announcement, the news bird also stressed that all franchisees must undergo strict qualification examination, including all aspects of the company's internal credit rating and self management capability.

Only the franchisees who meet the company's criteria and have good solvency can the company provide financial support and effectively reduce the risk of company's capital use.