XTEP Will Increase Retail Channel Network Distribution

In the face of the revival of China's sporting goods retail market, XTEP is still not out of the doldrums. XTEP International released yesterday's 2014 annual report, although the company's revenue rose by about 10% to 4 billion 777 million yuan, but in the operating profit, equity holders should account for the profits have declined, the two two consecutive fourth years of decline.

Data show that XTEP's operating profit last year was 808 million yuan, a decrease of 9.7% compared with 895 million yuan in 2013, and equity holders should account for 478 million yuan in profits, down 21.1% from the 606 million yuan in 2013. XTEP said that the decline in profit attributable to equity holders was mainly due to increased advertising and publicity expenses. XTEP increased last year Advertisement And publicity expenditure of 137 million 900 thousand yuan, the total expenditure of 623 million 700 thousand yuan, accounting for 13.1% of the group's total revenue.

In order to ensure overall operational efficiency and profitability, XTEP Efforts have been made to optimize the channels and management of retail distribution networks. By the end of last year, the number of XTEP distributors increased from 28 to 37, with 7110 retail outlets, and 250 fewer than in 2013. This is also the year when XTEP has reduced the number of stores since 2012. Statistics show that in 2012, the number of XTEP retail stores decreased by 86, and the number of stores in 2013 decreased by 150. XTEP international Chairman Ding Shui Bo XTEP plans to maintain about 7100-7200 XTEP retail stores in 2015 and expand XTEP's children's sales network to 600-800 retail outlets.

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At present, the average import tariff of China is 9.8%, the import tariff of middle and high grade consumer goods is mostly between 10% and 25%, and some varieties, such as some alcoholic drinks, reach 65%.

Import tariffs are not the only tax category in the import sector. In addition to customs duties, the imported goods still need to pay 17% VAT, and some high-end consumer goods also levy a consumption tax ranging from 10% to 40%.

For example, according to the current import and export tariff, imported perfume is subject to 10% tariffs, 17% value-added tax on imports and 30% consumption tax on imported goods; import tariffs of some wines are as high as 65%, and 17% additional value added tax and 10% import duty on imported goods are required.

The so-called discriminatory pricing is essentially a price difference, usually referring to the different selling price or charging standard between the recipient and the provider when providing different grades of goods or services of the same quality to different recipients. In western economics, price discrimination is defined as: at the same time, different prices are demanded for the same commodity to different buyers.

Taking the above-mentioned bags as an example, the actual price is still much higher than the price of the same product in Europe, except for the tax paid by each bag in the country. That is to say, these first-rate luxury brands, using their monopolistic position in the international market, will carry out different prices for different consumers in different markets, so that they can get excess profits.

In addition, the sales level of these famous brands in the country is very large, and the regional bargaining power is generally not high. Therefore, even if the tax reduction is made, it may continue to maintain a high price.

Reporters learned that Chanel is not the only price adjustment brand. In 2014, LVMH's high-end watch brand, Yu Bo, Zhen Li Shi and Hoya, launched the banner of Hongkong and the mainland in the same price, hoping to activate the mainland consumer market by price advantage. Previously, the price difference between mainland watches and Hongkong was between 10%~20%. This seems to be out of line with the way in which luxury goods consistently play. Previous news has been that some luxury brand manufacturers would rather destroy some damaged products than sell them at a low price, so as to maintain the high-end image of luxury goods. In the reporter's visit, a number of boutique staff also told reporters: "we never discount."

According to the scholar of consumer psychology, School of economics and management, Shandong University, for many luxury goods consumers, the price tag is not important, because discount will give customers a hint of quality, thereby reducing their brand image and affecting consumers' desire to buy. The reason why Chanel has adopted different price adjustment strategies in Europe and the Chinese market is that the continued depreciation of the euro is on the one hand, and on the other hand, the sales in the mainland of China continue to decline, while most Chinese consumers spend overseas.

According to wealth quality statistics, in 2014, the consumption of Chinese luxury goods in the mainland was 25 billion dollars, down 11% from the same period last year. The proportion of China's luxury goods market in the global luxury market dropped from 13% in 2013 to 11%. "Chanel Chanel has always been the vane brand of the luxury goods industry. Its move is also releasing a signal: Chinese people can buy reasonably priced luxuries without going abroad." Zhou Ting, Dean of the Institute of wealth and quality, told the media.

Zhou Ting said, first of all, we should change the mentality of irrational consumption of Chinese people. According to the data of University of International Business and Economics's Cheung Kee luxury Research Center, the proportion of luxury consumption expenditure in the mainland is too large, and the proportion of Western luxury goods consumption accounts for no more than 4%, while China's one hundred share is about 20%. China is still in the initial stage of luxury consumption, and is a show off consumer. This has prompted foreign luxury companies to "discriminate pricing", thereby pushing up the price of luxury goods in China.

In addition, the domestic sales policy is not perfect. Although China has a large number of processing trade made in the mainland, such as some high-end clothing, but according to the current policy, these products must be exported after processing in China, and can not be sold in the Chinese market.