Lining Will Spend Huge Sums Of Money To Pay For Extensive Expansion. Can 1 Billion 800 Million Remove Inventory?

< p > > a href= "http://ww.sjfzxm.com/news/index_f.asp" > sports brand clothing enterprise < /a > high storage has become a major ailment. Enterprises are cleaning up their inventory on the one hand and reducing the storefront on the one hand.

China's semi annual report shows that in the first half of this year, the total number of Kappa brand stores decreased from 3119 at the end of the year to 2550 now, a decrease of 569, with a decrease of 18.2% "/p".

< p > large area inventory became the biggest pain of < a href= "http://www.91se91.com/news/index_x.asp" > sports brand Lining < /a >. This time, Lining finally decided to "break the wrist and strengthen the picture".

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< p > a Hunan informed distributor who has followed Lining for more than 5 years told reporters that the inventory situation of Lining Lining will be alleviated practically. The inventory of about fifty million yuan in Hunan area will be designated as the repurchase scope of Lining. After the repurchase of these goods, it is very likely that they will be sold to or donated to overseas poor countries or regions.

Instead, there are a lot of new Lining products.

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< p > Hunan's "buy back plan" is actually part of Lining's "channel revival plan". In a 17 day announcement, Lining said that the company will launch a channel rehabilitation plan worth 1 billion 400 million -18 billion to help dealers clean up inventory and repurchase inventory, and it will be identified and implemented in the coming months.

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< p > < strong > > a href= "http://www.91se91.com/news/index_p.asp > > Hunan < /a > the estimated repurchase stock is about 50 million yuan < /strong > /p >

< p > in the face of the heavy inventory of dealers, Lining decided to spend money on buybacks.

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< p > "this plan has now entered the preparatory stage."

Chen Jun, a well-known dealer who followed Li Ning Co for more than 5 years, revealed to reporters that "the goods purchased by Li Ning Co are mainly in 2010 and 2011. Due to the widespread expansion of the industry over the past two years, the index purchase volume is 120% to 130% of the actual sales volume, resulting in inventory pressure."

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< p > Chen Jun also expressed his satisfaction with the price of the repurchase.

"The stock is priced according to the old and new degree of goods, basically between sixty percent off and half off."

The sale of Lining's old discounts is now three to sixty percent off.

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< p > according to Chen Jun estimates, the stock value of the repurchase in Hunan is estimated to be between 30 million and 50 million.

The stocks recovered from the group will also be sold to or donated to overseas poor countries or regions.

"For us, it means that we will be able to get rid of the vicious circle brought by inventory and let us have enough funds to buy new products to ensure the freshness and profitability of the market."

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< p > it is worth noting that the Lining dealer's upgrading of pavements has been in progress before the announcement.

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< p > < strong > announcement will denounce 1 billion 800 million huge sum of money for extensive expansion: < /strong > /p >

< p > the so-called "buy back plan" came from a Li Ning Co announcement.

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< p > 17, Li Ning Co announced a channel revival plan involving 1 billion 800 million of the capital, pointing directly at the inventory problem that has plagued the industry for a long time.

According to the announcement, the restructuring of accounts receivable will include supporting multiple dealers to clean up inventory, buy back, integrate sales channels and other multiple programs, aiming to speed up inventory clearance, revitalize downstream effective circulation, and enhance the profitability of channels.

Repurchase is a major focus of the plan.

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< p > "over the past decade, the company has rapidly expanded its sales network through wholesale operation, taking the lead in the first round of development.

However, too aggressive development has led to an increase in dealer inventories and a decline in the retail business's profitability and profitability.

Jin Zhenjun, executive vice president of Li Ningxin, said frankly.

In addition, Chen Jun told reporters that the next big focus of the Li Ning Co's next line of business is a big impact on the offline sales, which is currently under consideration.

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< p > < strong > pain 1 billion 800 million. Can we clear up the stock and doubt it? < /strong > < /p >

Lining has made many attempts before "P".

In 2010, Li Ning Co hoped that through brand remolding and consumer group adjustment, we launched the brand upgrading campaign with the core of changing the label, and finally failed to achieve the desired result.

In the first half of 2012, net profit was 44 million yuan, a year-on-year decrease of 84.9%, which indicates another crisis of Lining. Lining then made a structural adjustment to shops and closed 1200 inefficient stores.

This did not seem to have significantly improved Lining's performance.

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< p > in a sense, Lining's 1 billion 800 million channel revival plan now launched will be the battle of Lining's life and death.

Under such a significant impact, Lining's investors are not so optimistic.

Some investors in the Hong Kong stock market said in a media interview that although this measure is a "correct decision", it is doubtful whether the scale of 1 billion 400 million to 1 billion 800 million yuan is enough to clear Lining's old stock barrier.

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After the announcement of the huge recovery plan on the day of P 17, Lining's stock price dropped more than 5% after opening, and the daily report closed at HK $4.70, down 3.89%, and the turnover increased significantly compared with the previous trading day.

No matter how the market appraise this revival plan, it is probably not enough for Lining.

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