Odiphone Sold To Urban Beauty Is Conducive To The Extension Expansion Strategy

In the circle of friends, they have been talking about buying toilet covers in Japan these days, which has touched many "patriotic youth"'s heart. But then again, whether it is toilet covers in Japan, milk powder in the Netherlands or Apple phones in Hong Kong, they are really cheap and easy to use.

Not at all China There are no good goods, but good goods are too expensive; China also has a lot of cheap goods, but the quality is not flattering.

In the final analysis, there is something wrong with our commodity circulation.

Taking the underwear industry as an example, the cost price of an ordinary underwear produced in a factory in the Pearl River Delta is only 20-40 yuan, but when it finally enters the sales terminal, the price has risen to 100-200 yuan; The problem is that these profits did not enter the pockets of underwear manufacturers, because they only made a few yuan of profits for each piece of underwear, and all the price increases in the middle were spent on renting stores, shopping guides and advertising.

Because traditional underwear sales channels focus on shopping malls and large commercial centers, and lay out sales channels in the form of leasing generally, especially for high-end underwear production enterprises, terminal sales channels are concentrated in the shops of high and middle end stores, which requires higher store rent and guide salary. In addition, if there is no effective supply chain management, The depreciation accrual caused by a large amount of inventory is also a huge cost.

From the perspective of financial data, a traditional underwear brand Net profit The rate is less than 10%.

More troubling is that, under the impact of e-commerce, the passenger flow of traditional shopping malls and business centers has been declining in a straight line. However, the rising store rent and labor costs are eating up the profits of these stores. The dilemma faced by traditional underwear enterprises is that the 10% profit margin may not be kept.

Channel is the pain point of almost all traditional underwear enterprises.

In June 2014, as soon as the underwear brand "Metropolis Beauty" (2298. HK) was listed in Hong Kong, it created a market value of nearly HK $6.8 billion, and then this market value exceeded HK $10 billion at its highest.

From the perspective of performance, Metropolitan Beauty is no more than the traditional underwear brand Anlifang Holding (1388. HK). However, the current market value of Anlifang Holding is less than HK $1.6 billion, only 1/6 of Metropolitan Beauty.

The reason is simple. At present, "Metropolis Beauty" has laid more than 6000 terminal sales stores nationwide, and these stores are gathered on a powerful data information platform. Every underwear sold in each store will be transmitted to the company's headquarters in Dongguan in the form of data. For this data system, "Metropolis Beauty" has spent a lot of money, It also took many years.

tradition Underwear enterprises Not that they have not considered channel transformation, but they are more worried about the collective rebellion of dealers once the channel is adjusted.

If Gome is helpless to Jingdong Mall, then traditional underwear enterprises are helpless to "urban beauty".

Unable to compete, the only choice for survival is cooperation.

On March 2, "ODIFEN" sold its 19 year old company in Shanghai to "Metropolis Beauty" at a price of 92 million yuan, which is the design, research, development, sales and manufacturing of branded clothing products owned by the company.

According to the public information, "Audifen" brand originated in Taiwan and entered the Chinese market in 1993. It is also one of the oldest high-end clothing brands in China.

The purpose of "Metropolitan Beauty"'s acquisition of "Odiphone" is very clear, which is what Zheng Yaonan, the chairman of "Metropolitan Beauty", said: "Based on the domestic high-end intimate clothing market through Shanghai 'Odiphone''s perfect sales network and well-known brands, expand the market penetration in the intimate clothing market."

The purchase of "Otifen" by "Urban Beauty" is not intended to integrate the industry, although the concentration of the domestic underwear industry is very low at present.

A careful study of this acquisition agreement shows that the assets acquired include cash, accounts receivable, prepayments, raw materials, finished products and semi-finished products under the current assets owned by Shanghai ODIFEN; Production facilities, R&D facilities and store equipment under fixed assets; And intellectual property rights (including but not limited to trademarks) related to the business in intangible assets; Contracts and arrangements related to the operation of Shanghai ODIFEN stores (including self operated stores and franchise stores); Operating contracts related to the business; And any other assets necessary to continue the business.

It is not difficult to find that, compared with urban beauty, ODIFEN has a relatively high market share, high brand awareness, relatively mature high-end market sales channels and complete R&D and design capabilities.

According to Frost Sullivan, in terms of retail sales of bras and women's underwear, "Odiphone" ranked fifth and seventh respectively in China in 2014; As of December 31, 2014, Shanghai "Audifen" had about 614 retail stores, including about 250 self operated stores and about 364 franchise stores.

From the perspective of channel layout, these stores are mainly concentrated in department stores, shopping malls and other large shopping centers in the first tier and second tier cities in China, while "urban beauty" was previously targeted at mass consumption in the target consumer group, so the current market of "ODIFEN" does not overlap with the urban beauty, because it is conducive to "urban beauty" Expand different customer groups.

It can be expected that, after being incorporated into "Metropolis Beauty", "Oudifen" can, to a large extent, take advantage of the advantages of "Metropolis Beauty" in the upstream supply chain to reduce procurement costs. At the same time, it can also learn from the successful experience of "Metropolis Beauty" in downstream channels in recent years to increase sales and profit margins.

In addition, we noticed that in addition to paying the purchase price, Metropolitan Beauty also provided a entrusted loan of 105 million yuan for the brand, which is obviously a "blood transfusion" for the future operation of the brand.

The speculation about whether the acquisition of ODIFEN by Metropolitan Beauty will open the curtain of its industrial M&A still lacks support, but it is certain that Metropolitan Beauty has clearly recognized its advantages in the industry, and has also begun to use the power of capital to graft its own advantages and the advantages of competitors, that is, "Metropolitan Beauty" There are no internal obstacles to the strategy of extensional expansion.