Mcglaughlin's Brand Strategy Shrinks &Nbsp; There Are Only 7 Stores In Changsha With 1 Stores.

January 10th, 2 floor, Carrefour, South Shaoshan road. Mcglaughlin The shop closes half closed, and the clerk is busy cleaning up the store. clothing 。 "The lease is coming tomorrow, and the one or two days have been withdrawn." A shop assistant told reporters. This means that Mcglaughlin has lost another store in Changsha. There were 7 stores in Changsha when Mcglaughlin was the largest, and now only 1 of He Long's Carrefour stores.

This is China's largest B2C clothing. brand Why did Mcglaughlin shrink in Changsha? Liu Xiuni, director of the office of central China office in Changsha, said that Mcglaughlin was a franchisee and the reason for closing the shop was not convenient to disclose. Changsha is not a case. As of September 30, 2011, Mcglaughlin's self owned stores in the whole country reduced by 28, and its net loss in the third quarter was 14 million 400 thousand dollars. Mcglaughlin is not an example. The whole B2C industry suffered a cold spell in 2011.

　 Franchisee online platform attacks entity store business

I love Mcglaughlin's clothes. Changsha Ms. Lee, a citizen of the public, took a look at a dress on Mcglaughlin's official website yesterday. When he went to find Mcglaughlin's shop, he found Mcglaughlin in the rain flower Pavilion Cade square replaced by other brands. A cashier on the first floor of the Cade Plaza, a cashier, told reporters that Mcglaughlin had withdrawn from the store in the second half of last year.

In January 10th, Mcglaughlin's clothing store on the 2 floor of Carrefour, South Shaoshan Road, half closed the roll gate, and the clerk was cleaning up the clothes that had not been sold out. "Our store will be evacuated for the one or two days. The rental time of our store is too high. The store clerk introduced, "Mcglaughlin He Long store reservations, if customers like it, we will send a unified message to tell customers to go there to buy." Carrefour investment department staff told reporters that the store area is about 100 square meters, if joined the brand clothing store, the rent is about 20 thousand yuan a month.

Wu Ying, who had been a Mcglaughlin store in the new supermarket in Changsha, was surprised by the withdrawal of Carrefour store: "if business is good, rents are expensive." Wu Ying once took charge of 4 new Mcglaughlin stores in Xin Yijia supermarket, but they withdrew last year. She believes that Mcglaughlin's investment in physical stores is decreasing, and the supply is not normal; Mcglaughlin originally did online shopping, expanding the franchisee just to promote the brand; the price of goods to dealers was also high; and on the Internet discount, many customers rushed to the store to try on clothes and clothes, and then bought them online. This has affected the business of the entity store.

Mcglaughlin and He Long, a staff member of Carrefour, share the same feeling. He thinks that online shopping has a certain impact on store sales. If customers buy clothes in a physical store, they will be required to return products if they are cheaper. "We take the new model as the main factor, and the new online price is the same as that of the physical store."

For Wu Ying and others, the reasons for the conclusion are true. Mcglaughlin, director of the central office in Changsha, Liu Xiuni said that the reasons for the overall shrinkage of Mcglaughlin stores in Hong Kong were not convenient to disclose.

Mcglaughlin's brand strategy is based on online sales.

Mcglaughlin's brand has come to Changsha for nearly 4 years, but 7 stores in Changsha are franchised stores, and there is no direct store.

Wu Ying recalled that when joining Mcglaughlin, he thought the brand was ok, but the situation was different after the investment. "Although the fee is not accepted, the contract security, props and other fees are collected. Without completing the contract period, I lost only 1.2 million of the contract deposit. If I finish the contract period, I will lose more. "

Reporters from Mcglaughlin headquarters joined the Department learned that Mcglaughlin joined the business is still continuing. The conditions for joining are: the cities at the county level or above, the minimum area of the franchise shops is not less than 60 square meters, and the start-up capital of the project is not less than 300 thousand. We do not accept the franchise fee, but we will collect a deposit with a refundable nature such as the deposit of the contract. The contract margin is 10 thousand -3, and the contract is signed in 3 years.

Founded in 1996, Mcglaughlin started from the mail order business, known as China's largest online clothing business. After that, it launched the multi-channel distribution mode under the line and online, mainly selling self owned brand Ou Mengda (Euromoda) and Lan Peiqi (Rampage) women's clothing. In October 2010, Mcglaughlin listed on Nasdaq, becoming the first Chinese B2C company to list in the US, and the limelight is not two. But in 2011, Mcglaughlin's performance began to slide.

Mcglaughlin's three quarter earnings report in 2011 showed that the net operating income of the quarter decreased by 4% compared with the same period last year, and gross profit fell by 36.3% compared with the same period last year, and a net loss of 14 million 400 thousand dollars was recorded. Three quarterly reports also show that in Mcglaughlin's three retail channels (e-commerce, telephone ordering, physical stores), the development momentum of e-commerce has greatly replaced the other two. Mcglaughlin's offline stores (excluding franchised stores) were reduced to 115 from last year's 143. Although net revenue fell by 4% over the same period last year, the average monthly visitor arrivals increased by 23% over the same period last year. "This trend has also verified our strategy." Mcglaughlin chief executive Gu Beichun (micro-blog) said in a public statement. Gu Beichun once told the media that over the past year, there has not been much investment in offline stores, basically operating as a channel. Mcglaughlin's brand strategy, operation mode and product style are still mainly based on online sales.

In this regard, Internet observer Hong Bo told this reporter that the current B2C business in China is still in a high investment period, B2C mode may save a lot of offline store investment costs, but spent more money in brand marketing.

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Losses and bankruptcy exacerbate B2C enterprises in winter

As the only two Chinese B2C e-commerce listed companies, Dangdang (micro-blog) net and Mcglaughlin both turned profit from loss in the third quarter of last year.

Mcglaughlin's third quarter earnings report in 2011 showed that the company's net operating income was $53 million 100 thousand, down 4% from the same period last year, gross profit 14 million US dollars, down 36.3% compared to the same period last year, net loss 14 million 400 thousand US dollars, and net profit of 800 thousand US dollars in 2010. Mcglaughlin's share price has fallen nearly 90% over the past year.

Dangdang shares rose by 87% on the first day of listing in NYSE IPO in December 8, 2010. They are highly sought after by overseas investors. Its third quarter 2011 earnings showed that the company's total revenue in the third quarter was 908 million 900 thousand yuan, an increase of 50% over the same period last year, but the net loss was 73 million 400 thousand yuan, while the net profit for the same period in 2010 was 32 million 700 thousand yuan.

In addition to Dangdang and Mcglaughlin two listed companies declining performance, the domestic B2C e-commerce industry last year there are more than a few websites collapse phenomenon: headquarters in Shanghai B2C website warehouse because of shareholders lost confidence in investment, in September last year announced the closure; in September 29, 2011, the United States also announced the dress, stripped its electricity supplier business, transferred to major shareholders. Micro-blog, which was scheduled to submit IPO application documents in November 21st last year, has also postponed its initial IPO in the US due to the downturn in overseas capital markets.

Gu Beichun, chief executive of Mcglaughlin, told the media that e-commerce has had too much attention and venture capital in the past two years. Since last year, billions of dollars in the capital market have been irrational investment in China's electricity supplier enterprises. Whether IPO or private placement, it can reach hundreds of millions of dollars. The entire electricity supplier industry is currently dominated by capital.

Many companies can make profits before capital investment, and they will not make money after they are invested. Because investors believe that market share is most important now, making money doesn't matter, as long as there is growth, growth can only be made by throwing money. As a result, the prices of all media and offline media have risen rapidly, while homogeneity competition has pushed up the cost of human resources.

This sharp competition and the sharp rise in costs have led to a decline in profitability of the electricity supplier enterprises. All business enterprises have been under great pressure last year, and the whole industry is not making money. Mcglaughlin has been able to make profits in the past few years, but has been losing money since last year.