Nike Slimming Firepower PK Adidas

Following the closure of the sole shoe factory in China, and the suspension of many Asian shoe factory orders and termination of cooperation with several Asian apparel manufacturers, the world's largest

And Nike, a clothing manufacturer, continued to lose weight.

After announcing the sale of its brand Umbro (UMBRO) for $225 million, Nike plans to strip its shoe brand Cole Haan again.

Nike, which is beset by high inventories and declining performance, hopes to concentrate resources and rely on core brands to fight against Adidas.

However, judging from the situation in the past six months,

In terms of performance growth, it has been less than Adidas.

Frequent change of hands

According to reports, Nike intends to sell its footwear brand Cole Haan for $500 million to Apax Partners, a private equity firm.

At present, the two sides have entered the final stage of negotiations.

Reported that in the process of bidding for Cole Haan, an enterprise successfully won the advantage of private equity institutions such as TPG Capital Management and Berkshire Partners in Dezhou Pacific Group (601099).

Moreover, Ann Bai Shen has invited CONVERSE (converse) former CEO Jack Boyce to take charge of the Cole Haan after taking over.

Cole Haan mainly sells shoes, clothes and bags. It was founded in 1928 by Trafton Cole and Eddie Haan, and has flagship stores in major cities in the United States. It also sells products through department stores and other retailers.

The sale was compared with Nike's acquisition of Cole Haan for $24 for 24 years.

If finalized at a price of $500 million, Nike will not lose money in Cole Haan's return on capital.

However, Nike's brand Umbro, another buyer who has just found a buyer, is "cheap".

Recently, Nike announced that it had agreed to sell its brand UMBRO to the US brand management company Iconix B Rand G roupInc (hereinafter referred to as "Ai Connie J") at a price of 225 million US dollars.

It is expected that the sale of UMBRO will be completed by the end of 2012.

UMBRO, founded in 1924 as an old British football equipment manufacturer, has won the world cup award with many "green giants". It also has a large number of fans worldwide because of its long-term sponsorship of England national football team and many football stars.

And Nike initially bought UMBRO to compete with Reebok Adidas, and to make up for the gap between Adidas and soccer.

4 years ago, when Nike bought UMBRO, the paction price was as high as 565 million US dollars. Now the pfer price of US $225 million is obviously lower than the original price.

Nike president and CEO Parke said: "stripping any business is a tough decision, but this operation will help us focus more on business with high potential growth opportunities."

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Integrated resources

In fact, since June this year, Nike has begun to hawk UMBRO and Cole Haan brands.

At that time, Nike said that the sale of its brand was to cut costs, so as to better focus on the development of core brands such as Nike, Jordan Brand, Converse and Hurley.

"Within 4 years, Nike has almost dried up UMBRO's commercial value."

One industry person said that UMBRO is now a little bit valuable for Nike. "Especially in the later period of holding, UMBRO was not developing very well, and it could be said that Nike didn't put too much energy on this brand."

For the two giants of sports brand, Nike and Adidas, the former's products demand more attention to basketball, while the latter have strong resources in football field for a long time.

With UMBRO as a platform, Nike gradually introduced sponsorship and promotion into the field of football. Today, its main brand NIKE has been equal to Adidas in the field of football.

It is worth noting that acennis, who took over UMBRO, has established a distribution partnership with more than 230 retailers, whose business is mainly for China's Hongkong and mainland markets, and ACON's China Limited has established partnerships with many domestic garment enterprises including Shanghai's Swiss apparel, Bosideng and Shanghai La Natsu Bell apparel.

Based on this, many analysts say UMBRO is more likely to attack the Chinese market after changing hands, especially for the three or four line market, UMBRO's brand base is suitable for a pioneer.

For Cole Haan, Nike has also taken away its main resources from the current

Positioning, Cole Haan casual style, and Nike's main strategic areas of conflict.

Therefore, the above industry believes that behind the frequent switching of sub brands is actually Nike's integration of core brands, eliminating those brands that may compete with the main brands, and for investors, some of their brands are more valuable.

Concentrated fire PK ADI

In the downturn of sports industry, Nike is also suffering from high inventory and declining performance.

In the last quarter of May 31st, Nike's net profit fell by 7.6% compared with the same period last year, and its product inventories increased by 23%. In the first quarter of fiscal 2013, Nike's net profit fell again by 12%, to 567 million US dollars, and the gross gross profit margin of the current period declined for the seventh consecutive quarter.

Meanwhile, foreign media reported that Nike has publicly confirmed that the number of new orders in China's key market is decreasing.

Nike's first quarter revenue in the Greater China region was $572 million, an increase of 8% over the same period last year, slower than the same period last year.

In this way, the sale of sub brands can also increase Nike's cash flow to a certain extent.

And Adidas has just released its third quarter earnings report, which is relatively good.

According to the exchange rate unchanged, the global sales revenue increased 8% in the first three quarters of this year, and sales in the Greater China region increased by 16% over the same period last year.

In the third quarter, thanks to the two digit growth of Adidas brand, sales in the Greater China region increased by 11% over the same period last year.

Adidas also expects net profit growth of 15%~17% to 770 million euro ~7.85 billion this year.

In terms of performance, Nike's slowing growth has not been able to compete with Adidas. However, from the marketing strategy, Nike still insists on investing in its brand, while Adidas has a relatively independent promotion plan, whether it is clover, Reebok or Y-3.

In addition, since January 2013, Nike has officially become an official sponsor of International Olympic Committee.

Adidas ended its partnership with International Olympic Committee.