Esprit Is No Match For Fast Fashion. The First Big Loss Is Worrying.

During the period < p >, the turnover of < two a href= > http://www.91se91.com/news/index_c.asp > Esprit > /a > EDC and the top 76% brands accounted for 76% of the total turnover of the company (75.1% in 2012) and 24% (24.9% in 2012).

Among them, Esprit turnover decreased by 10.5% and EDC turnover decreased by 14.6%.

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< p > as of the end of June, the number of 1024 outlets in the Si Jie global stores decreased by 42 compared to the same period, and the same store sales level dropped by about 3.3% year-on-year.

In order to reduce inventory, it also accelerated the opening of special stores. At the end of the year, there were 79 special stores, with a net increase of 12.

Its largest sale area in Germany Ratingen is 3500 square meters.

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P said the loss was mainly due to the acquisition and impairment of goodwill, closing stores and stale inventories of Chinese associated companies, which amounted to about HK $2 billion 722 million.

Among them, the provision of tenancies for Europe's loss shops and the North American business of stripping the loss (all the stores in the region were closed by June 30, 2012).

Excluding these non recurrent items, the net annual loss has shrunk to HK $534 million, compared with HK $921 million in the same period last year.

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"P", "a" href= http://www.91se91.com/pioneer/ "Ma Hao Si /a", said the company's sales rebound will take time and structural improvement is needed.

The company will continue to close its stores this year, and its short-term goal is to reduce inventories by 10%.

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< p > in 2009, Si Jie global made a $3 billion 880 million cash purchase to Huarun for 51% rights and interests of the joint venture company, so that it formally owned a wholly owned Esprit brand.

At that time, Si Jie global was optimistic about the growth momentum of Esprit in the mainland market.

But Esprit, once a young man's chasing target, is now facing a serious dilemma of brand aging.

In the fierce competition of international fast fashion brands such as Zara, H&M and UNIQLO, it appears "hero's Twilight".

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< p > Esprit, < a href= "http://www.91se91.com/news/index_c.asp" > Zara < /a > more fashionable, H&M product line richer, UNIQLO basic cost performance is higher.

The series of weaknesses such as "not keeping up with popularity, falling prices, high inventories, low sales and slow turnover" made Espr it more and more strenuous in competition with competitors.

Taking inventory turnover as an example, Zara's inventory turnover is as fast as 7 days, while Esprit is about 102 days. The difference in turnover rate increases the storage cost of Espr it, and the reduction of warehouse cost means lower cost and quick updating of goods.

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< p > < strong > difficult to reshape < /strong > /p >

< p > Esprit once wanted to change.

SG has launched a "HK $4 4 year remodeling brand plan", including the stripping of the long lost retail business in North America, the recruitment of the world's highest earning model Gisele Bundchen as brand spokesperson, opening up new concept stores and streamlining business organizations.

The plan originally made the industry full of anticipation.

However, from the end of 2011 to the middle of 2012, the continuous high-level personnel changes led to the implementation of the reconstruction plan in less than two years.

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"P" finally, last year's new chief executive, Ma Hao Si, pointed out that the only way out for the company is to continue to cut procurement costs.

Ma Hao Si also proposed a new pformation plan. The goal of the next 1-2 years will focus on raising revenue, mainly through the four major aspects of brand, product, channel and business mode, and will delay the expansion plan in the mainland.

The company will also shorten the delivery time and improve the sales of the pilot stores.

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In order to find a breakthrough, P began to dig its competitors' corner.

In August 2012, the company excavated ZARA's chief executive and Inditex's former executive Jose Manuel Mart Nez Guti e rrez at a salary of about HK $40 million 830 thousand a year, and appointed him as executive director and chief executive officer of the group.

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< p > Mart Nez has served as director of distribution and operation of Inditex group, responsible for managing the distribution of the group and its extensive global retail network.

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< p > Si Jie expects to improve product design and fast supply chain process by introducing "ZAR A" talents, reducing the time from product to shelf sales to 7-8 months from the current 10 months, and finally to Zara and H&M.

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< p > but the actual effect of these measures is still unknown.

Management expects that the performance of Si Jie global is expected to revive in 2016.

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