US Stocks Are Too High For Huge Competition

Last year's end of the year, the inventory of the U.S. dollar up to 3 billion 160 million yuan clothing after nearly a year of "de" adjustment, inventory has finally improved.

However, due to the rapid expansion of its direct outlets, the industry is worried that in the second tier market, which is dominated by ZARA, H&M and other international fast fashion brands, the low-end market is also under the impact of online shopping and regional brands.

Last year's end of the year, the inventory of the U.S. dollar up to 3 billion 160 million yuan clothing after nearly a year of "de" adjustment, inventory has finally improved.

However, due to the rapid expansion of its direct outlets, the industry is worried that the low-end market will be affected by the rapid grabbing of international fast fashion brands such as ZARA and H&M in the second tier market.

And the impact of regional brands, the United States can not significantly enhance the efficiency of the Ping.

The 2011 Annual Report released by Smith Barney yesterday showed that its inventory balance was 2 billion 560 million yuan at the end of last year, an increase of 0.45% over the same period last year, accounting for 29% of total assets, compared with 3 billion 160 million yuan in the peak period.

Inventory turnover days dropped to 167 days, a decrease of about 1/3 compared with 243 days in the two quarter of last year.

The net cash flow generated by its annual business activities was also negative to the end of 2010.

As one of the earliest enterprises to learn ZARA and H&M fast fashion mode, Smith Barney's inventory and inventory turnover days are more serious in similar clothing brands.

In the first quarter of 2010, the US stock was only 700 million yuan, but a year later, the US stock rose to 3 billion 160 million yuan at the end of last year, rising by more than 300%.

In the two quarter of last year, its inventory turnover had reached 243 days.

In recent years, the United States has achieved some results in its adjustment.

A shoe and clothing marketer who asked not to be named told reporters that about half of its more than 2 billion 500 million inventory was direct store inventory, and that inventory in the direct store accounted for 60% in the quarter.

"In this way, the bad stocks are only 10 billion."

Semir clothing, the same as the leisure brand, reached 1 billion 96 million yuan at the end of last year, up 5.99% from the same period last year, accounting for 12.05% of the total assets.

By the end of the first quarter of this year, its stock amount increased to 1 billion 334 million yuan.

At the end of the year, inventory was nearly 349 million yuan, accounting for 16.12%.

In contrast, the US dollar inventory accounts for a high proportion of total assets.

Some analysts believe that the reason why the US stock is high is highly related to its direct mode.

The annual report shows that the company's direct revenue increased by 35% over the same period of 2011, while the total number of direct shops increased by 440 to 1130. However, the new shops had a large contribution to the total income and performance of the company during the reporting period.

During the reporting period, the franchise revenue increased by 30% compared with the same period, and the gross profit margin was about 40%.

The number of shops joined at the end of the reporting period increased from 2969 at the end of last year to 3663 at the end of last year.

As a matter of fact, the industry generally adopts the "de chemical" method. Regular sale will be held at the end of the season, new brand discount stores and export of scissors will be exported.

Shanghai's Cambridge East Road Metersbonwe headquarters warehouse stakeholders told reporters that in recent years, they will hold several special sales every year to sell inventory.

A salesperson of Metersbonwe's largest supplier, Kun Meng Da garment company, Pinghu, Zhejiang, told reporters that in the warehouse there were many years ago that the clothing of the state of America was still overloaded, and that "not sold, bad quality will be returned to us."

CICC reported that

Gross profit margin fell 1.2 percentage points over the same period last year, mainly because the company increased its discount efforts to digest inventory in 2011.

The company has more than 300 discount stores specializing in discounting inventory.

CICC also said that in the first quarter of 2012, the United States continued to increase its efforts to clean up inventory, but the gross profit margin was expected to decline.

The growth rate of stores will remain relatively high in 2012, and more than 900 stores are expected to increase. However, the industry is becoming more competitive.