Anta Olympic Games In Jinjiang

After the Olympic craze, Anta will respond to the upcoming market shock with its vertical business model and the "industrial closed-loop".

"Full court sports shoes 50 percent off, minimum 99 yuan."

This is a publicity slogan hanging at the door of a sporting goods store in Beijing.

Only half a month ago, most of these new products were sold for more than 800 yuan.

It is not just the storefront, but after the Olympic craze, many sports brands continue to return to the whirlpool of low price promotion.

Companies including Adidas, Nike and other international brands have linked some of the Olympic concept products with signs of "price reduction".

"On the one hand, all brands continue to lower the price of products, on the other hand, the rent and labor costs are rising. Sporting goods companies must learn to maintain profit growth in fierce competition, which is a challenge for the whole industry."

Xu Yang, director of Anta Sports Products Limited brand management center, said.

Anta semi annual report released in September 2nd showed that three factors boosted the brand's professional image, enhanced channel development and product mix. The turnover in the first half of the year exceeded RMB 2 billion 200 million yuan, up 50% over the same period last year, with net profit of 434 million yuan, exceeding that of Lining, XTEP and other peers.

Taking into account the average price of Anta footwear products and the average selling price of clothing products of 43.8 yuan (wholesale price), such performance exceeds the expectations of investors. 92.1

In the battle of Red Sea in the sporting goods market, Anta used its vertical business model and "industrial closed-loop" as well as high investment in R & D for many years to resist the impact of the international turbulent economic situation and win the opportunity for future development.

After the Olympic Games vertical business mode resists risks, "the rapid growth of performance benefits from our vertical business mode."

Xu Yang said.

Anta, which has thrive in the production business, has more than 10 years of layout in the procurement, production, R & D, promotion and retail of sporting goods. "These experiences effectively guarantee the competitiveness of the brand and the stability of its profits".

Hu Wenzhou, an analyst at BOC International, said that one of Anta's latest performance highlights was the gradual reduction of wholesale discounts offered to dealers, reflecting the dealer's recognition of brand profitability.

In a research report, Hu Wenzhou pointed out that in the first half of 08 years, the wholesale price of Anta's sports shoes and sportswear increased by 7.2% and 5.5% respectively.

Anta, founded in 1994, belongs to the first batch of sports shoes manufacturers in Jinjiang.

Anta has nearly 20 years of experience in the production of sports shoes.

Anta executives realized very early that "production can not be the whole of Anta".

Since 2001, Anta's rapid rise of Anta has deliberately extended the company's layout to outside the production line.

The company has completed the construction of the system from production to self sale, especially in the two or three tier cities.

In 2005, Anta founded the first sports science laboratory in China.

So far, the agency has contributed more than 40 national patents to Anta.

It includes new technologies such as "feel glue", "professional athlete foot database", "three-dimensional cutting of ergonomics" and so on.

At present, these technologies have basically completed the market pformation and will be used in product production one after another.

Among them, Anta spokesperson and NBA star Scola have been wearing Anta basketball shoes with core technology and "feel glue" technology to participate in the Beijing Olympic Games.

Whether the laying of channels or research and development of advanced technology has proved Anta's supply chain management capability.

In 2007, when Anta was listed, it raised HK $3 billion 168 million, setting the highest record of Chinese sports brands raising money in overseas capital markets.

In June this year, Merrill Lynch listed Anta as the "preferred stock of sporting goods in the mainland".

Among them, one of the conditions to gain international capital is the unique vertical business mode of Anta in China's first-line sports brands.

From the aspects of product design, procurement, production, logistics, brand packaging, terminal sales and other links, Anta has been improving since 2001, not only to ensure that the company can control costs in all links, but also to improve product premiums and ensure profits at terminal competition.

Anta: the post Olympic era of Jinjiang Department (2) at 16:08 on October 22nd, http://www.sina.com.cn2008, "digital business age", making decisions on exports or domestic sales. Ding Zhizhong, chief executive of Anta, told this magazine: "Anta and even the whole Jinjiang department are less affected by international economic environment than Nike, Adidas and other international brands.

Several leading enterprises in the footwear industry in Jinjiang are currently concentrated in the domestic market. This inward strategic positioning determines that the fundamentals of the whole industrial chain will not be affected by the oversea economic environment. "

After many years of development, many shoemaking enterprises in Jinjiang have located their battlefields in China. This makes the whole industrial chain of the local industry very dependent on imports and exports, and from raw materials to finished products can be produced and supplied locally, thus forming an "industrial closed loop".

A pair of sports shoes produced by Anta will use more than 100 kinds of raw materials, involving more than 30 suppliers and processors. Therefore, the economic environment is slightly sway, and every aspect of the industrial chain will turn to Anta or Hongxing Erke.

"There must be some pressure," Ding Zhizhong admits. "However, our advantages are also not available to others."

In his view, Jinjiang has formed a very healthy industrial cluster, and raw material processing will not be controlled by others.

According to reports, ordinary processors accept Anta and Hongxing Erke every month. If the product is defective, it will cancel its qualification next month.

"No way, the supply chain is perfect. They are not worried about finding alternatives."

An important reason why leading enterprises are very strong is that most of the raw materials of the processors come from the former.

"They are very demanding on the quality of raw materials, basically they buy them and then give them to us for processing."

A shoe factory owner who provided processing services for Hongxing Erke said.

The domestic layout and local procurement are the significant differences between many sports brands in Jinjiang and some domestic brands.

Zhang Tao, vice president of Anta, who served for eight years in Lenovo, is the first professional manager with a doctorate degree in Jinjiang enterprise. He quoted the viewpoint of Professor Xiang Bing of the Yangtze River Business School: the next layout made in China should be "chain to chain", that is, stick to the original manufacturing links, and advance to the upstream and downstream of the industrial chain, so as to enhance the bargaining power of the whole industry.

This bargaining power enables Anta, Hongxing Erke and other famous enterprises to have enough room for maneuvering to deal with suppliers and processors nearby. This is obviously unacceptable to global company such as Nike and Adidas, because the supply chain of the latter is all over the world. Although the foundry capability is very strong, once the Vietnamese Style financial crisis is encountered, the vulnerability will immediately appear, and this will return to the most primitive question: should the manufacturing link be outsourced?

Zhang Tao's answer is somewhat "implicit". He quoted Hammers's (RichardHames) in the five qualities of globalization Leadership: some people think that the strategy of globalization can be summed up in one word: outsourcing.

Running a multinational company can not be so simple, and this is not the best choice.

Outsourcing is a way to save costs by pferring non core projects to third parties. The only criterion for auditing third parties is to save money.

Especially in the competitive market, outsourcing is a crude and not satisfactory tool.

Lining's development of "national resources", along with the continuous improvement of China's economic strength and political status, is becoming an important link between the independent brand and the Chinese people. A good relationship with consumers can get a high premium on the products. Xu Yang said: "Anta has strengthened the brand" national character "resources in marketing.

In recent years, Anta has successively sponsored the Chinese men's basketball professional league (CBA), the Chinese Volleyball League, the volleyball tournament, the Volleyball Grand Prix and the Chinese Table Tennis Super League and so on. These sponsorships have won the reputation of "China League engine" for Anta.

These inputs enhance the image of Anta and are particularly beneficial to the development of "national resources".

According to the earnings report just released by Anta Hong Kong listed companies, Anta has completed 13 million pairs of sneakers and 21 million 100 thousand sportswear in the first half of 2008, of which sales of clothing products are close to that of 2007.

Ding Zhizhong, chairman and chief executive officer of Anta's board of directors, said that in the future, Anta will increase investment in functional sports products, children's sporting goods and fashion sporting goods market, so as to ensure profit growth.

With this boost, Morgan Stanley expects Anta's third and fourth quarter orders to increase by 50% and 80% this year, and continue to support earnings performance.

Anta's rival Li Ning Co is relying on large-scale brand promotion to expand its leading edge.

The four Chinese team sponsored by the company during the Beijing Olympic Games won many gold medals, which greatly enhanced Lining's popularity in China.

The high cost of promotion, coupled with the brand's Olympic effect, will undoubtedly bring pressure to Anta.

In the background that it is difficult to use conventional means to surpass rivals, Anta hopes to exploit the market with segmentation strategy so as to give full play to the advantages of supply chain.

It is reported that Anta is cooperating with the national sports products standardization committee to improve the standard system of domestic sportswear, and strives to take the lead in competition by standardization and technology.