Glory Belongs To The Past &Nbsp; Li Ning Co Is Going Downhill.

Lining, born in 1963, according to the traditional method of calculating age, 2012 is precisely the year of knowing destiny.

Unfortunately, no matter what

Just after the Spring Festival, there was news that Li Ning Co announced massive layoffs, adjusted the organizational structure and reduced the cost of personnel.

Affected by this news, the Li Ning Co listed in Hong Kong closed 8.08 Hong Kong dollars / share, down 5.386%.

On February 8th, Li Wei, a spokesman for the Li Ning Co, was clarified in an interview with reporters.

In fact, the negative news about Li Ning Co is more than that. In the turnover of company executives, Li Wei's predecessor, Zhang Xiaoyan (micro-blog), just left in November last year.

"We did not say it was a layoff, which may not be understood very well."

Li Wei told reporters that the organizational restructuring is part of the group's strategic pformation aimed at focusing on core business, optimizing the organizational structure, improving operational efficiency and improving net profit margin.

Glory belongs to the past.

Lining, as a famous male gymnast in China, has created the myth of World Gymnastics history and is known as "the prince of gymnastics".

After the 1988 Seoul Olympic Games, Lining officially retired.

Then in May 1990, Lining started in Sanshui, Guangdong.

When the Li Ning Co was founded, the "Lining" sportswear was selected as the Eleventh Asian Games torch relay designation.

After more than 10 years of development, Lining brand has become a leader in the field of sports apparel in China.

At the opening ceremony of the 2008 Beijing Olympic Games, Lining's appearance set off the climax of the whole stadium.

At this moment, Li Ning Co's reputation has reached its peak.

Data show that since its listing in Hongkong in June 2004, Li Ning Co's performance has maintained rapid growth for six consecutive years, reaching 8 billion 387 million yuan in 2009.

With the help of the Olympic "magic power", Li Ning Co has caught up with Adidas, which once surpassed the world's second ranking sporting goods maker, and became the second largest sports brand after Nike.

However, in the post Olympic era, the Li Ning Co's internationalization strategy and brand remolding didn't work well, but made it difficult.

By the year 2011, not only did Adidas return to the second place in China, but Anta (micro-blog) was also catching up.

In fact, since 2010, the Li Ning Co has started to go downhill. The performance estimate issued in January this year is not even good news for Lining himself.

Earnings forecasts show that group growth is expected to decline by about 6%-7% in 2011 compared with 2010, due to weak growth in orders and partial inventory of dealers.

Combined with various factors, the net profit margin of the company will drop by about 7 to 8 percentage points from 11.7% in 2010.

Prior to this, an analysis report of JP Morgan showed that in 2011, Lining's annual revenue would go back 13%, and profits would fall by 60%, while Anta's revenue would increase by 22% and profit growth 15%.

Lining is expected not only to be surpassed by Anta in 2011, but also to catch up with other second-line brands.

An anonymous person in the sports industry told this reporter that taking PEAK sports as an example, the brand is almost the same as Lining's international brand sports brand. Now Lining has almost given up on the off and on, and PEAK has been recognized by international top event organizations such as NBA, FIBA, WTA and more than 80 foreign markets for more than 20 years. The international market revenue has accounted for 10% of the total revenue.

In recent two years, Li Ning Co executives have left their homes.

According to incomplete statistics, during the past two years, Li Ning Co's chief brand official Shi Wei, chief operating officer Guo Jianxin, Lotto (Lotto) general manager Wu Xianyong, vice president and CPO (chief product officer) Xu Maochun, government and director of external public affairs Zhang Xiaoyan have been removed from office.

Downsizing pformation

For the plight of the Li Ning Co, Zhang Qing, the first marketing manager of Li Ning Co and the founder of Beijing key road sports consulting company, said that the growth rate of Li Ning Co slowed down, plus the mistakes of the executive side of the brand pformation, which led to the current situation of Li Ning Co.

Over the years, it has not done a good job in cost control and operational efficiency. The layoffs are also part of the company's reform.

Zhang Qing revealed that Lining wanted his brand to be younger, but there were some mistakes in its expression and some specific tactics in the dissemination of the brand, including the "post-90s" formulation, which led to a misunderstanding that Lining abandoned the "70 after" and "80 generation".

In order to change the current predicament, Li Ning Co announced in February 3rd that the group should optimize and adjust its organizational structure in response to the strategic steps taken by the group in its initiative and the business development plan in 2012.

The management and responsibilities will be adjusted accordingly with the change of organizational structure.

This reporter learned from Li Ning Co that for some non core business sectors, such as other brands and other sectors, Li Ning Co will further integrate to focus more on the core business of the group.

For the functional departments in the background, including human resources, information technology and strategic development, the company will adopt an optimized organizational structure to enhance operational efficiency, reduce personnel costs and invest resources in the core business of the group.

Li Wei told reporters that the adjustment includes streamlining personnel, integrating resources and motivating excellent employees. So far, the specific number of staff members has not been determined yet, but the proportion will not be too high.

In fact, Lining is looking for an external force for the company to seek a pformation.

In January 19th, Li Ning Co announced that two investors had subscribed to convertible bonds issued by the group, one member of TPG, the world's leading private equity firm, and another member of Singapore's Government Investment Corp, a global investment management company that manages Singapore's foreign exchange reserves.

Reporters also learned from Li Ning Co that this year will be the key year for Li Ning Co reform.

The focus of its 2012 work is to focus on core business, optimize organizational structure, enhance operational efficiency and control costs effectively. Li Ning Co will also adjust its product structure, control procurement costs, raise gross margins, continue to promote channel pformation and effectively digest inventory.

In addition, Li Ning Co wants to use the London Olympic Games to better connect closely with Chinese consumers.

For the pformation of Li Ning Co, Zhang Qing believes that the pformation of Li Ning Co is something that must be done, otherwise there is only one way to die.