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Costs Rise, Profits Fall, Local Sports Brands Drop In Profits.

2013/4/9 10:01:00 28

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Lining (franchised store) recently announced its earnings report, which was the first loss in listing eight years, and nearly 2 billion yuan in 2012. During the same period, Anta (franchised store) also fell for the first time in five years, and its net profit fell 21.5% to 1 billion 358 million. PEAK's net profit fell by 60.1% to 310 million.

what is the problem of local sports brand? Brand ambiguity, product homogeneity, blind expansion, the outside world can find various reasons for their "recession".

In the eyes of management scientists, facing the "defect" is the first step out of the "recession".

inefficiency expansion and overdraft advantage

"some styles are not sold."

During the Ching Ming Festival, a staff member of a Lining store in Longgang told reporters that the holiday business was not as hot as expected.

He said that some of the customers in the shop were migrant workers, and some of them had never seen any of them.

reporter login to Lining website found that the company only has nearly 40 stores in Longgang District of Shenzhen, covering almost all the people in Longgang district.

By contrast, another famous foreign sports brand is only about 20 stores in the whole Shenzhen area.

"Sales are not directly proportional to the number of stores."

An unnamed Shenzhen broker, a href= "http://www.91se91.com/news/index_c.asp" > textile industry < /a > analyst told reporters that many domestic brand stores did not play a role in promoting sales and brand promotion, but just the product of blind expansion.

in fact, the Lining family is not the big expansion.

Lining, Anta, XTEP and PEAK landed in Hong Kong stocks in 2004, 2007, 2008 and 2009 respectively.

"Capital has boosted blind expansion."

The above brokerage analysts said that these brands used the international capital of Hongkong at that time to raise large sums of money for the pursuit of "China's domestic demand" and the Olympic concept.

After that, the funds were mainly placed on the expansion of stores.

On the one hand, excessive expansion ignores site selection and management, resulting in low profitability of individual stores. On the other hand, the emergence of a large number of franchisees causes the entire channel to lose the ability to respond to the market, and headquarters can not get accurate data of market changes, and there is no way to adjust products.

< < a href= > http://www.91se91.com/news/index_h.asp > > inventory > /a > serious, can not get money in the two tier market, can only introduce PE.

The above analysts believe that from now on, the original "not bad money" of domestic sports brands are facing financial pressure, which will exacerbate the crisis.

But on the contrary, it also means that the enterprise has the pressure of investment income.

If PE can carry out effective business innovation, such enterprises like Lining will still have the chance to rise again.

costs rise and profits lower /p >

a few days ago, a reporter found in some stores in Shenzhen that the difference between similar products and international brands of domestic sports apparel on the market is between 90 yuan and 150 yuan.

This means that if the cost is not large, the profits of domestic clothing will be about 100 yuan lower than that of the international counterparts. If the two sides compete at the same market level, the domestic brand will be forced into the "dead end" of the price.

What kind of pressure does P brand international brand bring to local peers? Wang Gao, a professor of marketing at CEIBS, believes that pressure comes first from the loss of low cost advantage.

Before, some Chinese enterprises do have cost advantages, but at present, some foreign brands and domestic brands have no difference in the OEM factories. The cost is not quite different. At the same time, some foreign brands gradually shift the factory to the lower cost < a href= "http: //www.91se91.com/news/index_p.asp" > Southeast Asia < /a >, so "low cost" may become the "past tense".

"the sink of foreign capital brand channel is another pressure."

Wang Gao pointed out that at present, Nike, Adidas and other brands are also beginning to make low-end products. It is very easy to buy sports shoes of foreign brands with three hundred or four hundred yuan.

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reporters also learned from some PRD manufacturers in Fujian and the Pearl River Delta that although the clothing industry is in the "de Stocking" stage, many factories have been shut down for half a time.

But as soon as the production is resumed, the owners immediately find that the wages of the workers have risen.

The industry believes that this will be a nightmare for domestic brands, because their prices are low, and the bargaining space of terminal prices is not large. When costs rise, profits will be thinner.

potential consumer group declined

in the eyes of many people, Chinese sports brands have been actively avoiding foreign brands on the road of development.

When the "80's" increase in economic income and more and more foreign brands are being chosen, many domestic brands begin to choose their target customers as "post-90s" and call them "the younger generation".

But the problem is that capital boosting capacity expansion and store expansion ignore the difference between "post-90s" and "post-80s" people.

first is the change of population size.

According to the data of the National Bureau of statistics, China's "post-1980s" has 124 million, which is close to 10% of the current national population.

But after entering 90s, the number of new born population began to drop sharply, from the peak of 26 million 200 thousand in 1990 to the current annual 16 million.

The above brokerage analysts said that the sharp decline in the number of potential consumer groups has been reflected in the backlog and weakness of domestic brands.

"Macro data is very clear, and domestic brands need to adjust their strategies."

more importantly, "after 90" is not necessarily a domestic brand.

"They are more tide and cool than" post-80s ". Those who really have continuous purchasing power will choose who will be" 90 after "?

viewpoint .

Su Yong, director of enterprise management department of Fudan University: strong > pformation needs to reshape supply chain /p >

At present, domestic sports brands are carrying out self reform such as P inventory.

Su Yong, director and doctoral tutor of the enterprise management department of Fudan University, believes that in addition to lowering production capacity and adjusting the product mix, the domestic sports brand is more important to re-examine the channels and supply chain construction.

P, for example, a famous clothing company in China has rapidly expanded its stores to expand its market share, forming the structure of 1/3 direct and 2/3 franchisees, but eventually led to a lack of communication between consumers and enterprises.

Companies have paid a lot of price to speak for the first line movie stars, but brand promotion has not brought sales data, but has brought soaring inventories.

Su Yong believes that "U-turn" requires accurate market information, and accurate market information comes from efficient and firm channels.

First of all, poor channels will inevitably block information communication, and product development will be out of touch with the market. At the same time, weak channels will reduce the efficiency of supply chain, inventory turnover rate and capital utilization rate will be reduced, and enterprises will not be competitive.

Therefore, reshaping channels and supply chain construction should be put first.