Old Brand Revitalization Road Long: Only About 10% Of Normal Operation

Many enterprises believe that it is time to revive the old brand.

But in fact, the revival of old brands is no easier than creating a new brand.

Since June, Yu Zhengsheng, Secretary of the Shanghai municipal Party committee, has studied many times.

Industry and old brand enterprises require that governments at all levels and relevant departments should care about the needs of enterprises, study policies and provide support, do everything possible to help enterprises achieve pformation and development, protect and develop national brands, expand and strengthen their own brands, and effectively enhance the competitiveness of enterprises.

The survival of those old familiar brands has attracted wide attention from all walks of life.

And the fierce competition of Wang Laoji (micro-blog) trademark also makes the market focus instantly. Are they so priceless?

In fact, after many years of fierce competition, most of the old brands are not living at the right time.

"The definition of the old brand has evolved. It used to refer to the brand created before 1949, and now the concept has expanded.

There are about 65 thousand old brands, and about 1500 can be seen in the market now. About 10% of them are relatively normal.

The overall situation is not very good. "

Shanghai Jiao Tong University (micro-blog) An Tai Yu Mingyang, Party Secretary of the school of economics and management, said.

He said that the most common reason for the decline of most old brands is that the quality of products is seriously aging and can not meet the needs of modern society.

However, according to market observation, the manufacturing industry is facing development bottlenecks because of the continuous economic downturn, and the pformation of industry and products is much more difficult. Many enterprises hope to rely on the revival of old brands, or intend to acquire old brands, so as to help enterprises overcome difficulties.

There is a reason for this plan.

In 2011, Lin Yi, director of the urban industry department of Shanghai economic confidence Committee, introduced that in 2011, the added value of the brand advantage enterprises in light industry and textile industry was 13% in the more than 400 production enterprises, and the total output value increased by 18%, much higher than the average value of the industry.

"Brands and enterprises with brand advantages are doomed to be competitive.

They will have great potential in promoting employment and stimulating services. "

Lin Yi expresses.

However, the revival of old brands is no easier than creating a new brand.

The best time?

Most of China's old brands focus on consumer goods, such as cosmetics, catering, clothing and so on.

Its survival has gone through numerous checkpoints.

But the reform of state-owned enterprises in 1990s is an important watershed for the development of old brands. After this round of baptism, many old brands were washed away.

"At that time, the marketization mechanism was open, and many state-owned enterprises were lack of incentives, inflexible mechanisms, backward management, deteriorating business conditions, and international brands were attacking the city, the private enterprises were full of vitality, and the old brands under many state-owned enterprises disappeared quietly."

Market participants said.

This is also related to the concept of consumption.

"When the door opened, consumers worshipped the foreign trade marks, and even the phonetic alphabets on the trademarks were very clever. They all felt the lack of a sense of the times, which was disastrous for the old brands."

Yu Mingyang said.

After this campaign, most of the old brands failed, and even if they were not eliminated, it was difficult to restore their aura.

"For example, flying music, permanent bicycle, Venus TV and so on are gradually precipitating in the market."

Yu Mingyang said.

But at present, many enterprises think that it is time to restart the old brand.

Their reason is that the soil of existence has changed.

"The time has come for China to become a brand."

Shanghai Jahwa chairman Ge Wenyao (micro-blog) on the judgement.

Shanghai Jahwa is ready to participate in the Tianjin watch factory. The main brand of the factory is the seagull Tourbillon watch.

"Tourbillon watch technology is no worse than Swiss watches, but its price is less than that of 1/10. We have taken a look at its brand and technology, and decided to carry out market-oriented restructuring, leading design and operation. We are confident that we can turn it into a high-end watch brand that is exactly the same as Swiss watches."

Ge Wenyao said.

Ge Wenyao said that the so-called maturity is based on a variety of reasons. First, the market can see that foreign capital companies also make mistakes.

After the media exposure, the aura of foreign investment has been recede little by little. Secondly, China's manufacturing level has made great progress, and its R & D level and marketing ability are also gradually improving. Third, Chinese consumers are gradually mature, pragmatic and opinionated, but worshipping foreigners abroad is the most important soil for the development of ethnic brands. Fourth, the world's three largest economies have problems this year, and China's comprehensive strength is enhanced, which will also help enterprises build national brands.

Xie Guoyi, deputy director of the Huangpu District SASAC, believes that "to a certain extent, the development of enterprises is to create brands, and then to maintain brand names. The development of Chinese enterprises has reached the stage of creating brands.

For old brands, they also have the power to maintain and innovate.

As a result, many old brands are beginning to glow. "

In addition, the government is constantly introducing policies to encourage enterprises to build their own brands. The recovery of old brands has been waiting for the best time? {page_break}

But timing is obviously not enough.

The reality is very complicated.

Shanghai City Commission for Industry and Commerce has been sorting out and researching the old brand enterprises of light industry and textile industry.

Lin Yi introduced that most of the old brands in the textile industry were concentrated in textile holding and Shanghai garment factories, but the old brands in light industry were scattered over the districts and counties or Shanghai municipal state-owned enterprises because of the restructuring of light industry group.

Since decentralization, the attitude and vision of the competent departments and enterprise groups to old brands are different. The operation of the old brand enterprises is quite different.

Even some old brand enterprises have no intention of operating. They only rely on authorizing other field enterprises to produce similar products, and can charge their own brands to charge the license fees.

"Production, manufacture and sale are all the other side enterprises, and have no control over the authorized enterprises' quality channels."

Industry experts.

"At present, the old brand enterprises can be divided into three categories, one is better management, such as Lao Fengxiang, three guns, etc., one is the balance of power enterprises, such as white rabbit toffee, the shoe industry, and the other is dusty."

Introduction of Lin Yi.

Reviving old brands is difficult for enterprises, needs and foundations are different, so there will be a considerable gap between the prospects and the process of revival.

The revival of old brands is not as easy as imagined.

Status quo

Shanghai Kai Kai Group Co., Ltd. is striving to maintain the living environment of the old brand.

Jingan District SASAC's Shanghai Kai Kai Group is an old brand gathering place.

It has 8 old brands, including dragon and Phoenix cheongsam, Lei Yunshang, Kai Kai, Heng Sheng, first West villa and Hongxiang, among which Longfeng Qipao and Hengsheng are selected as the national intangible cultural heritage.

These brands belong to the next two enterprises.

In 2001, Lei Yun Shang and Kai Kai opened a group of listed companies to open industry. The other 6 old brands were classified as unlisted platforms Hongxiang department store in Shanghai.

Among the 8 old brands, Lei Yun's performance is the most outstanding.

Its profit is 30% per year, the profit in 2008 is 14 million yuan, and it is expected to reach 35 million yuan in 2012.

It is not easy to maintain rapid growth in the increasingly competitive pharmaceutical circulation.

"We adjust our strategy in a timely manner, highlight its characteristics, turn to the consumer health care industry at our own expense, and avoid the frequently adjusted drug policy areas."

Zhang Xianghua, chairman of Lei Yun Shang pharmaceutical West District Limited, said.

Their strategy is not to squeeze along with others in one way, and strive to open up new fields.

"With the improvement of living standards, consumers will invest more and more in health preservation."

In its field of health preservation, its main products include tonic supplements and Chinese herbal pieces.

"We will upgrade the traditional tonic cream to standard production, and Shanghai will soon set local standards according to the cream we produce."

Zhang Xianghua said.

Because the market trend has been grasped, its "Shang Lei" series of Chinese herbal medicine has doubled its profit in 3 years, and has been sold from around 10 million in 2005 to more than 100 million yuan now.

There are up to 500 varieties of health products, such as ginseng and antler, and become their leading products.

But other old brands are much harder.

"Most of the old brands are small and medium-sized enterprises. In today's environment, they can only be said to be dismal."

Chen Huiquan, chairman of Shanghai Kai Kai Group Co., Ltd. is exclamation.

It is understood that the Hongxiang brand, founded in 1917, has a sales volume of only 20 thousand yuan 4 years ago, and its stores are very few. In the past two years, it has only reached 2 million yuan to 3 million yuan. We have done our best to maintain the operation of the old brand. Now, we have made a slight profit in the loss, profit and loss balance, and the small profits continue to expand.

Chen Huiquan said.

It is a lot of trouble for old brands.

It includes subsidized rents, the establishment of brand funds, and the establishment of design centers for old clothing brands.

"For example, the rent subsidy, for the dragon and Phoenix cheongsam shop, more than 12 yuan per square metre, the group subsidized 3 yuan for 3 consecutive years."

Shi Guozhen, general manager of Hongxiang department store, said.

In addition, the group has invested 2 million 870 thousand yuan in the past 3 years to set up a design center for Hongxiang department store.

"Introduce talents from the market to design, display, marketing and publicity, and carry out training to help enterprises train successors."

Shi Guozhen said.

Hongxiang company currently has close to 100 profits per year, so the most crucial design center of garment enterprises still depends on group support.

But the opening of the group itself is also a heavy burden, and it also shoulders the livelihood of the people in the district.

"For example, the vegetable market, grain and oil market are all operated by the group, and we have social responsibilities."

Chen Huiquan said.

In addition, 6 years ago, the group opened up a business misfortune, resulting in a loss of more than 10 billion yuan. Its sale of assets was able to repay its debts, and it did not have much support for its subordinate enterprises.

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"Longfeng Qipao has deliberately hired an internationally renowned consulting business to package and plan for the enterprise, but the price is millions of dollars. We do not have such a lot of money and we can only give up at last."

Chen Huiquan said.

Old brands lacking funds are not enough to attract young people.

"Clothing old brand is the most important design and inheritance. With the old employees getting older and retiring, it is the main factor that troubles us."

Shi Guozhen said.

It is understood that, for example, dragon and Phoenix cheongsam, due to exquisite handwork, and sewing, embroidery, buckle to volume, proofing, learning the basic skills of clothing will take two or three years.

"These skills require oral teaching, and are explored in the long term practice, with strong intensity and low remuneration, and fewer young people are willing to join the industry."

Shi Guozhen said.

On the one hand, the new strength is not enough; on the other hand, the number of retirees and laid-off workers is increasing, so it is difficult for old brands to play in the market.

Obviously, old brands are hard to maintain only on their own strength.

Why not introduce strategic investors or simply sell them? But it is understood that the old brand enterprises are very serious about their responsibilities and are very vigilant against outsiders.

Introducing investor problems

"Old brands can't be destroyed in our hands. We must never sell them."

This is Chen Huiquan's bottom line.

Because of this, he opposed the simple sale of brands.

Even if we introduce strategic investors, investors will be very demanding.

Chen Huiquan's request for investors looks simple, just to keep the brand, but in fact, it is hard for the two sides to negotiate without confidence.

"As long as the other side reveals a little and does not want to invest in the old brand business, we will give up negotiations immediately."

He said.

Two years ago, the dragon and Phoenix cheongsam contacted two strategic investors.

Opening up the ideal investors of the group is, "it is better to be state-owned enterprises in Shanghai. We are confident that we can cooperate boldly, and we do not necessarily hold shares. But if it is foreign capital or private enterprises, we are very worried that they will put these old brand brands on the shelf."

Chen Huiquan said.

Even financial investor PE, Chen Huiquan has reservations.

"PE is eager for quick success and instant benefits and is not consistent with the pace of doing business.

If we can help and help us, that is the most important thing. "

This actually represents the general worry of old brand enterprises.

Ge Wenyao, chairman of Shanghai Jahwa, also stressed in its restructuring that it could not be sold to foreign-funded enterprises.

Once contacted PE, an investor said frankly, "we have had contact with many local brands, but they are very cautious and not very practical.

The requirements are very high, for example, we can not hold shares, we can't manage them and so on. Finally, the cooperation is not effective.

In this way, there are not many enterprises that are ideal.

Shanghai's state-owned enterprises are mostly large manufacturing enterprises, and few garment manufacturers. It is difficult to integrate factories like dragon and Phoenix cheongsam.

There are more problems in the integration of foreign state-owned enterprises or central enterprises, which involve tax collection, personnel resettlement and more government level approval and coordination. Besides, how to estimate the value of old brands? As state-owned enterprises, the high or low valuations of assets or brands will cause widespread debate in the market.

However, the introduction of

In addition to capital investment, there is another meaning, that is, to accommodate franchisees, which can solve the problem of capital and expand the market rapidly.

Chen Huiquan is still cautious about this.

Its shirts were opened by chain, but the dragon and Phoenix cheongsam did not intend to expand in the form of franchising.

"Open shirts are standardized production, assembly line manufacturing, headquarters have good quantitative standards to control the franchisees, but the dragon and Phoenix cheongsam is purely hand-made, the quality can not be guaranteed.

One is popular standard production, the other is customized tailor-made, not the same way to join.

Shi Guozhen said.

Old brands with similar ideas are not uncommon.

Such as Lao Fengxiang.

"We require uniform packaging, unified standards, unified propaganda strategy and uniform quality for all stores.

Old brands are famous stores, and the social impact is great. Franchising will certainly save the cost of opening stores, but once the expansion is rapid, the quality and standards of the franchisees are difficult to manage, and if there are quality accidents, the attack on old brands will be fatal.

Xie Guo said.

However, whether the introduction of strategic investors or attracting affiliate, there are many successful precedents for old brands.

For example, ruby food company and British business cooperation, Huangpu District Hongxing glasses company and Holland HAL company and other cooperation, and Quanjude also expand the market in the form of chain affiliation.

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How to choose? It's a tough choice for old brands.

Luxury line

It is understood that many old brands rush out of tight encirclement and pursue niche luxury market. Is that the right choice?

Companies are looking at the luxury market.

This is of course rooted in the attractiveness of China's second largest luxury consumer market in the world.

After the adjustment of the dragon and Phoenix cheongsam from the mass market to the luxury market, business has improved.

"The annual output reached 800 to 900 pieces, the lowest 2000 yuan per piece, the highest of nearly 40 thousand yuan per piece, and has completed 6 sets of sales."

Shi Guozhen introduced.

The minimum selling price and the average selling price of the market have increased by 1500 yuan each.

Because it is tailor-made, there is no stock.

But the luxury line is destined to be a niche market, and Longfeng Qipao does not want to give up its traditional handcraft, so it must give up its scale.

Can niche marketing support business?

The cheongsam's tailored quality is suitable for the high-end line, and China does not lack the luxury market, but lacks its own luxury goods. The Longfeng Qipao handcrafts rely on inheritance to ensure the quality.

The annual output of Swiss watches is also very small, but the profit margin is quite high enough to support the growth of enterprises. "Longfeng Qipao" has something to do in the luxury market.

Chen Huiquan is very determined.

But from the old brand to fashion luxury, the road is still far away. To go through a long incubation period, the initial investment costs are high, including R & D, marketing, packaging design and other links, all require enterprises to have super strength support.

Shanghai Jahwa's re development of cosmetics "double sister" can fully display the luxury line is not easy.

Twin sister brand was born in 1898, and won the gold medal of Panama World Expo in 1915, but it gradually faded out of Shanghai in 40s and 50s.

In 2007, the localization of Shanghai Jahwa was pformed into fashion group. At that time, cosmetics began to subdivide.

Jahwa in Shanghai is striving to build a brand portfolio that covers the middle and low end of the high school and occupies many segments in the market.

In this context, Shanghai Jahwa has launched a series of high-end cosmetics brands, such as Herborist, Chinfie, recoverable, GF and so on.

When the "twin sister" brand was born 110th anniversary, in 2008, Shanghai Jahwa decided to take the opportunity to resurrect "twin sisters". Its positioning is the top brand of Shanghai Jiahua.

In order to attract the market in one move, Shanghai Jahwa has invested a lot in its efforts to integrate global resources and reference to the experience of foreign luxury operations, and "tell the Shanghai story in the world".

In addition to inviting brand consultants and overseas teams to do product packaging design at the beginning, it invited French renowned design companies to be responsible for store design, and asked him to be the artistic director of twin girls, who served as ambassador for 5 years in Berluti (LVMH's famous hand made shoes brand), and served as Dunhill global image and media director in 7 years.

At present, though the two sisters have invested a lot, the growth of market share is not obvious yet.

From the perspective of its revenue structure, Liu Shen's business revenue probably accounts for about 45% of total business revenue, and Herborist accounts for about 25% of the total revenue. Shanghai Jahwa should let double sister enter the harvest period as soon as possible.

Market participants said.

Prospects for revival

Many industry experts have a rather reserved attitude towards the revival of old brands.

Xie Guo said that if the brand is not maintained for 3 years, if it wants to resume, it will take 6 years.

Some old brands have been silent for many years, and they are expensive to maintain.

Moreover, the old brand is mostly a completely competitive market, and the competition state has become saturated.

"No matter whether to create new brands or to excavate old brands, the opportunities are far from enough."

He believes that whether old brand or new brand, entering the market requires a number of conditions, such as capital, culture, maintenance, talent, promotion, business and so on.

"The advantage of restoring old brands to create new brands is that they have a story, a culture of precipitation, and easy to re open the market, but there are also limitations. The innovation and pformation of products, such as the fact that mass consumption is now a luxury, is not easy to accept."

Yu Mingyang also said that the cost of restoring old brands is not low, such as R & D investment, sales input, promotion investment and so on.

Therefore, "not to recover for the sake of recovery, but to give ourselves and consumers a reason to have the value of recovery."

But there are also optimists.

Chen Huiquan said: "old brand enterprises mainly adhere to, step by step, and accumulate the foundation and experience."

He does not deny that it is not easy to restore the glory of the old brand, but "the operator must have confidence and determination to believe that time is on our side."

However, no matter how we look at the prospects for revival, business operators and market experts are relatively consistent.

"We can set up a brand building fund in the national income, and further lean toward the quality brand in the capital, and support the enterprise to develop the brand strategy.

At the same time, we hope to make full use of the capital platform and continue to foster the advantageous enterprises with broad market prospects and strong brand effect to enter the capital market.

Xie Guo said.

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Chen Huiquan also expects the government to tilt the old brands in terms of tax and bank loans, "allowing SMEs to survive."

It is understood that Shanghai will introduce a number of opinions to promote brand building, and will set up a brand to promote joint meetings, the government departments to gather forces to jointly promote brand building.

"Every year, about 20 old brands will be selected to focus on promoting capital, land and talent."

Introduction of Lin Yi.

In addition, the Shanghai municipal government will build a public service platform and convenient service system to create a better production and sales environment for enterprises.

"What the government can do is create a good environment for development, but the initiative of business lies in the hands of enterprises. Every year 20 key enterprises are promoted. We will choose enterprises with certain industry influence and market potential, so enterprises must take the initiative."

Lin Yi expresses.

Market experts also suggest that the old brand enterprises should establish flexible market mechanism as soon as possible, and be keen to catch market information, and should not be stuck with their weaknesses.

old

Revival is a long way to go.