Under The Meager Profit Of Fujian Sports Shoes Enterprises, Whether There Is A Way To Re Integrate?

In August 2012, it was destined to be memorable for Fujian sports brand.

Just concluded the London Olympic Games "marketing war", Fujian four sports

Also unveiled the first half of this year's performance "victory": Anta, 331, PEAK all reduced profits, XTEP is more stable, but the net profit has also maintained only 0.3% of the increase.

It is understood that the decline in performance and the top of the sports brand inventory has a direct relationship.

At present, discount promotions have become the most commonly used means of sports brands.

Insiders say that the sports brand of Fujian is estimated to be eased after 2013 due to the stock crisis that broke out in the second half of last year.

The four sports brands only have a small profit.

In August 10th, Anta first announced the company's semi annual report, with a turnover of 3 billion 934 million yuan (RMB, the same below) in the first half of the year, down 11.6% compared with the same period last year, and net profit fell 17% year-on-year.

In response to the unsatisfactory results, Anta's executive director and chief operating officer, Lai Shi Hsien, analyzed that the industry was dominated by discounted vicious competition and rising operating costs, which were the main reasons for the decrease in profits.

But Anta just started a head.

In August 22nd, the semi annual results released by the three major local sports brands, 360 degrees, PEAK and XTEP, completely exposed the market predicament faced by the current sports brand enterprises: the turnover in the first half of the year was 2 billion 869 million yuan, down 9.9% from the same period last year, and net profit was 596 million yuan, down 22.9% compared with the same period last year. PEAK's performance in the first half of the year was even bigger, and its semi annual report showed that the net profit in the first half of the year decreased by 43.3%. XTEP was lucky enough to pass the customs, but the net profit in its semi annual report also maintained a 0.3% increase.

For the decline of the company's performance, Liu Xiang, deputy director of PEAK public relations, thinks that in the past few years, the company overestimated the market demand and is now in the integration period of digestion inventory. It is expected that the industry will start to pick up in the next two years.

"The development of the company is relatively steady, but it also faces the whole industry's problems.

In the past few years, the market has maintained an increase of 30% to 40%. The demand has slowed down, but the enterprises still operate according to the scale of their previous production. In the second half of 2011, the whole industry is facing "ceiling".

Zhao Xianglin, director of XTEP marketing activities, said.

Market

New products are also discounted, leaving more employees.

If the performance is just a few figures, the downturn in the market will now show more dismal sports products.

Yesterday is just the seventh night of the Seventh Festival. Some sporting goods stores in Fuzhou East Street are on sale, but there are few consumers in the shop.

Promoters at Anta street sports store, South Street, said recently, new products have just appeared.

12% off, the discount for non new products is as low as 40 percent off. If you buy two pairs, you can also sell them at a preferential price of 50 percent off.

And on the two floor of the store, there is a discount field with lower discount.

Fuzhou tea kiosks, Chung Ting Street and other places also have Anta, 360 degrees and other brand sales sites, discounts vary, and some even lower to 70 percent off.

Discount does not attract consumers, and poor stores result in some employees leaving.

Wu Zhuangzhuang once worked as a store manager at a Jordan sports store near Tung Jie Kou. He left the office in the first two months.

Because of the declining performance this year, the company simply shut down the store he owned.

Likewise, Mr. Lin, who has left the Adidas Road store, has already switched to a dress brand.

Mr. Lin said that because of poor performance and less pay, many of his colleagues left him.

In Yuan Hong City

The promoters said that the base salary for the company was 1650 yuan, and this year's performance was bad. Her salary in recent months has only been kept up to the standard. Last year, she earned at least 3000 yuan a month.

Coping with

Enterprises reduce wholesale discounts to stimulate dealers

Since last year, sports brands have been holding up their inventory, and store performance has not been improved. How to solve the inventory problem remains unresolved.

Taking PEAK as an example, the total inventory grew by 107 million yuan in the first half of this year, and the average stock turnover days increased from 86 days in the previous year to 86 days. The average receivable and receivable turnover days increased from 66 days to 121 days.

In order to speed up the de stocking, some sports brands adopted a way to reduce the wholesale discount (hereinafter referred to as "deduction") to stimulate dealers.

In this respect, Anta did the earliest.

The company said that in order to reduce the potential inventory and discount risks of retail channels, the group continued to adopt more flexible placement arrangements.

At the same time, the wholesale discount rate will be reduced in 2013.

Then, 31st degree said, since 2011, the autumn order will start in December 2010, and the drop of the wholesalers will be adjusted from 62% to 60%, and the 2012 spring / summer order will be further adjusted to 58% in July 2011.

PEAK also said that since 2012, the company has reduced the deduction to distributors, but the increase in the rebate amount and the cost of sales has offset the rise in the price of footwear and clothing products, resulting in a decline in gross margins.

"Making profits to dealers is an inevitable measure, because dealers are also facing high storage pressure, and enterprises can reduce their flexibility to dealers, which can increase the flexibility of dealers."

Zhao Xianglin also said there was little room for long-term use of the deduction mode.

"Similar to the production terminal enterprises, the sales terminal business mode will also operate in a small number of batches, but with the current conditions, dealers' channel operation will also face upgrading."

Zhang Qing said that whether the sports brand, or production terminals, sales terminals, the entire industry chain will face upgrading and integration.

"The collective downturn in the whole industry is not unexpected, and the adjustment period will continue until 2013."

The key road founder Zhang Qing said the whole sports brand's industrial chain will face a new round of integration.

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For the first time, a small number of soles were used to supply business performance.

The sports brand industry chain has entered the integration period. As the terminal supplier of the industrial chain, the sole supplier has taken the lead.

As the sole sole supplier of Anta and XTEP, and the top five shoe suppliers of 31st degree, Hongxing Erke and del Hui, the performance of Thailand shares in the first half of the year is also affected.

Recently, Thailand's shares reported that its operating income in the first half of the year was 160 million yuan, down 15.91% from the same period last year, and net profit was 57 million 601 thousand and 500 yuan, an increase of 161.03%.

However, in the total profit of about 70000000 yuan, more than about 50000000 yuan came from government subsidies, and net profit after deducting non recurring gains and losses dropped by 21.7%.

The head of the Securities Department of Tai Ya said that the pressure on the sports industry is increasing, and the pressure on the main customers of the company has increased. The order mode of customers has adopted a small number of business models for the first time.

Compared with the past, the utilization rate of pigments and moulds and other raw materials decreased, the cost increased considerably, and the company's revenues declined.

Zhao Xianglin said frankly that in the period of enterprise adjustment, the scale of production is bound to be adjusted accordingly, and this business model is estimated to last for 1 to 2 years.

In Jinjiang, there are a large number of enterprises that make soles. There are also small businesses and small workshops in large enterprises including Tai ya, Xin Xie Zhi, etc.

"These production terminals enterprises still have market space in the field of outdoor sports and children's clothing, and enterprises can coordinate with each other, such as the adjustment of moulds and so on, so as to improve the utilization rate."

Zhang Qing believes that during the adjustment of sports brands, the production terminal enterprises will also face a new round of integration.

Lai Shixian also said that the market has not yet seen improvement, and that the industry needs to be extensively integrated to eliminate some weaker brands.

Related news

Nike will raise its price if it fails to bear cost pressure

Sports brand high inventory, increased cost pressures, finally let the first tier brands can not withstand.

Media reports said Nike will increase its shoes and clothing prices by 5%-10%.

It is reported that this autumn, Nike will launch the most expensive sports shoes tenth generation LeBron basketball shoes so far, which is expected to sell for $315 (about 2003 yuan), while the retail price of its ninth generation shoes will be about $250 (about 1590 yuan).

An industry analyst said that with the rising cost of raw materials and pportation in the past two years, Nike has put pressure on its profit growth.

The latest report shows that Nike's gross profit margin fell to 42.8% from 44.3% in May 31st, which has been declining for the sixth consecutive quarter.

Sales in the Greater China market, the second largest market in Nike, also fell in the same quarter. Sales of products including footwear, clothing and accessories accounted for $667 million, down 3.89% from the third quarter.

Morgan Stanley's research report shows that in the fourth quarter of 2012, Nike's global orders growth slowed from 18% to 12%, especially in China, where orders grew sharply from 20% to 2%.

But as a direct competitor of Nike, Adidas's second quarter results in 2012 were very gratifying.

Adidas's public figures show Adidas's sales in Greater China are 732 million euros, up 19% over the same period last year.

Adidas forecast annual net profit growth from the previous 12%-17% to 15%-17%.

Guangzhou daily

Lining half profit 85%

According to the Hongkong daily news, Lining's inventory is too high. In order to save the country, the fund TPG was introduced earlier. Lining, founder of the company, personally "went out of the mountain" and changed the chief executive officer, but still failed to reverse the situation. In the first half of the year, net profit fell 84.9% to 44 million 290 thousand yuan (the same below).

In June, Lining, a big rating management group, predicted that the net profit of the company would go down in the year. Now it is expected to record losses for the whole year, and for the first time since 2004, it has recorded a full year loss.

Lining recorded a net profit of only 44 million 290 thousand yuan in the first half, returning to the first half of 2005, and gross profit margin fell 3.1 percentage points to 44.2% during the first half of the year.

During the period, the company recovered part of the dealer inventory, and the order growth was weak, so that the balance of inventory and trade receivable increased, and the provision for assets impairment increased greatly. The proportion of administrative expenses increased by 2 hundred points.

It is noteworthy that in the first half of the year, total provision for bad debts was 61 million 220 thousand yuan, 4 times higher than the end of the year, the number of days of receivables turnover increased, and the days of cash turnover extended, which had a greater impact on operating cash flows.

In addition, in the second half of the year, due to the publicity expenses of London Olympic Games and other events, and the sponsorship of China Men's basketball professional tournament, the annual advertising and publicity support increased, accounting for about 13% of the revenue in the first half.

Another sporting goods unit, China's trend, saw a decline in gross margin in the first half, down 11.1 percentage points to 50.2%, and operating profit margin fell 17.1 percentage points to 6.4%.

Stock repurchase increased by 179 days to 304 days due to stock repurchase.

In the first half, sales of footwear decreased by 31.9%, while clothing sales decreased by 43.3%.