Samsonite Will Launch Its Acquisition Expansion In China

famous Suitcase Enterprise Samsonite (Samsonite) plans to buy a company in China in the next three to four years. It may not be another brand, but will help Samsonite extend to other categories or expand its brand in China's distribution channels.

The headquarters of the 103 year old American brand is now in Kowloon, Hongkong, selling around $2 billion annually. Net profit rose 3.4% in the first half of this year to 85 million US dollars.

In 2009, CVC, a private equity fund, employed Tim Parker as CEO to avoid losing its investment in Samsonite because of its declining performance. He was an old hand in reforming the brand. shoes At the time of Clark, the nickname of the "Dark Prince" was given to him because of the sharp cutting of people and cost reduction, which eventually brought the shaky old brand back to life. In Samsonite, he applied the technology again and led the company to go on the market in Hongkong in June 2011. So far, the stock has risen by 2/3, with a market value of HK $32 billion and a P / E ratio of 27 times.

After Tim Parker took over, he decided not to follow the general rule. Luxury brand The way to sell the same products in the global market is to plan product mix for different market characteristics.

In addition, Samsonite tries to arrange Western expatriates (expats) as little as possible in emerging market markets, focusing on localization of human resources to better understand local customers' needs.

In an interview, he also revealed the following important information:

There are many interesting brands in China and Asia. It is expected that in the next three to four years, Samsonite will complete its first acquisition in China.

In fact, Samsonite has already delineated potential acquisition targets. Although CEO refused to disclose it, he said it would not coincide with the existing product line of Samsonite. The purpose of the acquisition will focus on replenish new product lines or expand distribution channels in the mainland of China.

In addition to the flagship brand Samsonite, the company also has a mid end suitcase brand American Tourister and luxury suitcase brand Hartmann - the former is becoming more and more popular in the Chinese market, which is said to have been the first choice for the US president.

According to CEO, Samsonite will spend more than US $1 billion on acquisition activities, and it will be spread to multiple projects. At present, its net book cash is 1.5 to 200 million dollars, and its liabilities are zero.

He made it clear that another US suitcase brand Tumi was not considered in the acquisition - Tumi's sales scale was Samsonite 1/6, but the valuation was too high (currently Tumi's P / E was about 29 times).

He also ruled out the possibility of acquiring India's local competitor: VIP.

In short, China is the key.

The Chinese market now contributes about 10% of Samsonite's revenue, second only to the US. This year's growth is expected to be between 12 and 15%.

It is worth noting that Samsonite's Internet sales in China have grown rapidly, doubling last year, accounting for 16% of the total sales in the Chinese market. This year's double eleven Online Shopping Festival, Samsonite online sales of more than 9 million yuan.

Driven by the Youth Travel craze, the growth rate of the mid-range brand American Tourister has reached two times that of the Samsonite main brand.

China's two or three and four tier urban markets are booming, accounting for Samsonite Sales in China 1/3, and 1 1/4 years ago.

In addition to the Chinese market, the Southeast Asian market is full of strength. Indonesia's annual growth rate is 50%, the highest in Asia. Russia is the fastest growing country in the world.