Lining: Torment Pformation Period

< p > Li Ning Co's first half financial report shows that the group's net profit in the first half of the year was 184 million yuan, which has been substantially reduced compared to the previous 1 billion 997 million yuan loss.

Although the losses continued, the Li Ning Co half year performance Conference (investor meeting) held in Conrad Hong Kong Hotel in August 12th has revealed some light breath.

Compared with Lining's fatigue in March's 2 Li Ning Co performance conference in 2012 this year, he relaxed this time.

< /p >

< p > since the announcement of the pformation and pformation plan in July 2012, one side is the great loss in the statements, the other is the vision for the future. Lining is suffering from a painful pformation.

< /p >

< p > < strong > deficit > /strong > < /p >

< p > Lining always gives a serious impression, whether facing his own people or facing the media.

It can be seen that the Li Ning Co's losses were truly effective: as of June 30, 2013, the Lining group achieved 2 billion 906 million yuan in revenue, a decrease of 24.6% compared to the same period last year, and a pre tax profit plus depreciation and amortization (EBITDA) of 58 million yuan. In the first half of the year, the loss of equity holders should be 184 million yuan and a loss of 15.19 points per share.

Although the word "deficit" is still in the lead, it has narrowed considerably compared to the total loss of 1 billion 997 million yuan in 2012.

< /p >

< p > as of June 30, 2013, the total number of Lining's regular shops, flagship stores, factory shops and discount stores totaled 6024, representing a net decrease of 410 compared with the end of last year.

54 dealers, 1 less than the end of the year.

But its inventory situation has not fundamentally improved.

According to the results, the average inventory turnover lasted for 96 days, which was 90 days at the end of last year.

At present, most of the inventory is in the channel, not Li Ning Co.

In contrast, Anta's inventory turnover in the first half of the year was only 58 days.

< /p >

< p > the most satisfying part of the overall financial report is "the average accounts receivable cycle of Lining in the first half of the year", which has been reduced from 97 days in the end of 2012 to 88 days.

Jin Zhenjun, executive director and executive vice president of Li Ning Co, said with a laugh, "the company has about 1 billion 600 million yuan in cash at hand.

There is no financing plan. "

< /p >

< p > < strong > revitalize the channel < /strong > /p >

< p > Li Ning Co has been established for 23 years and has a large team.

< /p >

< p > no matter what type of company, once the scale reaches a certain level, there will inevitably be a series of problems such as slow reaction mechanism.

It's like a huge dinosaur with a knife on the tail that takes 8 minutes to pass to the brain.

Lining needs a team to help him reform and pform.

His left arm and right arm appeared: one was Ceng Huafeng, chief financial officer who joined in April this year. He can speak fluent English, one is executive director and executive vice president Jin Zhenjun, and the other is Korean American.

< /p >

In order to revive the channel, Jin Zhenjun and Lining himself and the board of directors set up a "channel revival plan" with a budget of up to 1 billion 800 million yuan (P).

< /p >

< p > the plan is to support dealers to clean up inventory and ultimately improve financial and cash flow.

Jin Zhenjun said that behind the 1 billion 800 million yuan is a fundamental change, including a wholesale business model that has been profitable in the past and pformed into a retail oriented, consumer oriented business model.

Pay attention to single store efficiency in profits, because the company's channel is not healthy, then the company can not be healthy.

< /p >

< p > in the round of another round of "closed shop tide", Lining group is a target of great concern.

Although there are no specific target stores in the second half of this year, Mr. Kim admitted that the pformation of Lining group has only gone to "50%". For some small dealers, perhaps half of them have not yet been completed.

Lining group reported that the company closed nearly 1300 stores in the past year, of which 430 were closed in the first half of this year.

But closing stores is not the only measure, and there are also changes in the order form.

< /p >

< p > < strong > return to public positioning < /strong > < /p >

< p > closing the store is a way to stop bleeding, but too many stores will also turn the company's profit into a "passive water".

In the serious sports products industry, the realization of product differentiation is the only way.

< /p >

< p > "Lining does not target consumers by such traditional characteristics as age, income and region.

We think that consumers in big cities and people in the two or three tier cities are increasingly rich people who are potential customers of Lining. "

Lining emphasized that sport is a sport, not a luxury.

Sports consumers themselves do not have age, income and geographical boundaries.

Even Adidas and Nike customers include both college students and the elderly.

From this point of view, after the failure of the "post 90s" campaign, Lining's return to the mass consumer orientation is a correct strategy.

< /p >

< p > compared with other local brands, Lining, as an enterprise founded by star athletes, has been outstanding in product design, quality and sports marketing in the past 20 years.

The key is how to pass this advantage to the process of dealing with young consumers.

< /p >