Lining Net Profit Declines Year After Year, When Will Local Sports Brands Get Out Of Difficulties?

Group 22 evening released the mid day report shows that the first half of the group attributable to shareholders of listed companies net profit fell 84.9%, and released the first annual loss after Hongkong listed early warning.

Affected by this, on the 23 day, the stock price of Lining group fell 3.8%.

Lining group net profit "diving" also pulled the 6 largest local.

The current situation of collective depression.

Insiders pointed out that local sports brands are collectively passing the "winter".

Blind expansion of market share, imitation of products and lack of innovation are the main reasons for the serious decline in performance. In the next 2-3 years, these enterprises still can hardly usher in the "spring" of recovery.

Lining group net profit fell more than 80%

A person in charge told reporters that the serious shrinkage of the group's profits was mainly due to being in the stage of reform, and "determined to solve the historical problems with great efforts to better achieve the future recovery".

In the first half of the year, the group optimized the organizational structure and increased the cost.

In addition, the decline in inventory value of group agent brand Lotto has also increased the one-time cost of the company.

What the company calls "historical problems" mainly refers to high inventory.

The data showed that the Lining group in the first half of the year was 1 billion 138 million yuan.

Lining group said that in the second half of this year, efforts will be made to increase discount sales and further build channels for clearing goods.

At the same time, we should further adjust the layout of retail outlets to enhance retail management capabilities.

The official also revealed that in order to adjust the layout of retail outlets, the group closed 952 inefficient stores in the first half of the year, and the number of shops in the regular stores, flagship stores, factory stores and discount stores in the country is still 7303.

In the past, the business model of over reliance on opening stores has encountered development bottlenecks.

We hope to solve the problem of over expansion and focus our efforts on improving the sales efficiency of existing good shops, which is the foundation for long-term development in the future.

The source said.

Local sports brands collectively pass the "winter"

Lining group profits shrink, Guangdong

Li En, vice president of the apparel industry association, believes that because of blind expansion and imperfect supply chain mechanism, Lining and other domestic sports brands are suffering from pformation.

"This sharp drop in profits can be seen as an early release of risk, marking the return of Lining group."

Li En said.

In fact, it is not only the Lining group that is troubled by the decline in performance, but the local sports brands are encountering a "cold current" collectively.

Data show that in the first half of the year, except for "XTEP international" revenue rose slightly, Anta fell 11.6% year-on-year; 361 year-on-year decline of 10%; PEAK's year-on-year reduction of 28.5%; China's trend fell 29.4% compared to the same period last year.

Cheng Yuan, senior researcher of Huatai United Securities, believes that the decline of local enterprises' performance is not "a cold day".

In addition to the market space being squeezed out, the local sports brands have failed to predict the market consumption ability after they have been listed on the market. They have blindly accelerated the layout of their stores and won market share, resulting in high inventory prices, which eventually dragged down their performance.

Cheng Yuan believes that the "horse racing enclosure" is essentially an extensive mode of operation, resulting in the emergence of a bustling brand of sports, and with the impact of the subdivision of clothing on the sports market and the need for reform of the management mode, the speed of the bubble burst has also accelerated.

A direct consequence of "horse race enclosure" is high inventory.

Group analyst vanguard believes that inventory problems affect capital turnover and business continuity, while discounting and selling inventory will affect the brand image of the company. The poor sales will affect the time and style of the next season's new products.

At the same time, vogg believes that because of the lack of R & D capability, the imitation of products and the homogenization of local enterprises, the ability to resist cyclic demand decline is weak.

"Practicing inner strength" can usher in "spring".

The industry believes that due to the local sports brand production capacity and shop laying in the country has basically saturated, in the next 2-3 years, it is difficult to usher in the recovery of the "spring."

Cheng Yuan believes that local sports brands should decisively close inefficient stores, reduce operating costs, improve single store performance, and end the bubble era of blind expansion.

Industry experts pointed out that ADI and Nike's advanced experience may be worth learning from.

First of all, excellent product quality and leading styles make them popular in the market.

The replacement rates of these two brands are high, and every new season's products are refreshing.

In addition, the products are subdivided, swimsuits, children's wear, yoga and other products meet the needs of more consumers.

"Domestic sports brands should not fight with their rivals, but fight with the market."

Li En pointed out that the success of an enterprise will win by brand and operation mode. The urgent matter of domestic sports brand is to find out its own personality and core competitiveness, accurately locate and excavate its own unique brand connotation.

Experts believe that at present, local sports brands are in the stage of differentiated competition, and the era of volume winning is no longer available.

"Practicing internal strength" is a "compulsory course" that enterprises can not relax at any time.

Subdivision, improving product quality, updating design concepts and customer experience may provide a way out for struggling local sports brands.