Lining Five Years Of Development, Loss Of Key Words

Over the past three years, the total loss was more than 3 billion 100 million yuan, and 3000 stores were closed. 3 times the price increase was overtaken by Anta. What has Lining experienced in the past five years?

The old prince of gymnastics is 52 years old this year.

As a well-known local sports brand in China, the Li Ning Co's response in the past two years is not satisfactory.

Why did the Lining brand, which had been on the top of the market by the "bird's nest"? Why did it go downhill for three years? It's hard to stop bleeding in the next two years. Lining is on the helm again, and the slogan is "anything is possible".

Total losses in three years exceeded 3 billion 100 million yuan

In August 8th, Lining chose to rebrand slogans on this day, "anything is possible".

Although the Li Ning Co's external caliber is "Si Qing" of Li Ning Co that night, it has little to do with the opening of the 2008 Beijing Olympic Games in August 8th.

But this time point seems to be hinting at something.

Lining returned to the mountains to control the company.

In March this year, Lining announced that he was acting as the chief executive officer. Meanwhile, Lining personally opened Sina micro-blog, and he went to the front line to interact with the shop assistants and consumers.

For the successful bid of the Winter Olympic Games, whether Lining intends to win sponsorship, Ai Qing, President of Li Ning Co, responded that the Li Ning Co's sponsorship of Olympic Games is unclear.

Independent commentator Ma Gang said that for the current situation, the Winter Olympic sponsorship is already Anta, and Lining can not get the message again.

But Anta China Deputy Director Ren Xin Zhao said that the current Winter Olympic bid has not yet begun, everything is uncertain.

Ma Gang said, "Li Ning Co executives' changes are related to changes inside the company". Changing slogans alone is of little significance to Li Ning Co. If it is put together with its new strategy, it will be quite meaningful.

"The slogan of restarting the peak era of Li Ning Co can arouse consumers' fond memories and arouse the inner passion of channel partners and Lining people."

Ma Gang believes that there is another implication. There are mistakes in the past. It is not too late to correct them.

In 2010, the sporting goods industry was competing with the real stores. In 2015, O2O and experiential shops became popular.

As early as the end of June 2010, the slogan of Lining's brand was changed from "anything is possible" to "MakeTheChange."

The Li Ning Co announced at the time that the new slogan reflected the evolution from dare to think, and encouraged everyone to dare to change and break through.

However, in the past 5 years, the huge "change" that brought to Li Ning Co has been in a quagmire.

Public data show that from 2012 to 2014, the performance of Li Ning Co has been in a state of deficit. The amount of losses in three years was 1 billion 980 million yuan, 390 million yuan and 7.8 billion yuan respectively, totaling over 3 billion 100 million yuan.

In addition to performance losses, Li Ning Co has also fallen into a dilemma of high inventories and closed stores.

From 2012

It can be seen that Li Ning Co's revenue was 6 billion 739 million yuan, a year-on-year decrease of 24.5%; gross margin was 2 billion 550 million yuan, and it was 36.9% lower than that of the same period last year; the equity holder should account for a loss of 1 billion 979 million yuan.

At that time, Jin Zhenjun, executive vice president of Li Ning Co, explained that the loss of nearly 2 billion yuan was mainly a one-time adjustment made by the company. In the end of 2012, the risk of all accounts was cleaned up at the end of the year so that it could be installed in 2013 young people.

Unfortunately, Li Ning Co not only lost 390 million yuan in 2013, but also reported a deficit of 780 million yuan in mid 2014.

The Li Ning Co, which was originally loaded with light weapons, did not change.

In the meantime, Zhang Zhiyong, a veteran Li Ning Co veteran who led the brand slogan change, was declared to be the chief executive officer.

The post was jointly executed by Jin Zhenjun and Lining, and Jin Zhenjun was the representative of TPG, who invested in Li Ning Co, to enter Lining's board.

From 21 to March 2014, Jin Zhenjun served as the acting chief executive officer of Li Ning Co.

Although Jin Zhenjun also introduced a number of change measures to implement a large-scale one-time channel rehabilitation plan, but as an airborne soldier, Jin Zhenjun did not let Lining pick up.

A total of 3000 stores

Losing and closing stores has been a true portrayal of Lining's domestic sports brand in recent years.

The strategic vision is aimed at the strategy of the international market and the post-90s young people. It not only made Lining's products lose the advantage of the original cost-effective, but also made the "Lining" brand gradually move away from the original 70 and the post-80s consumer groups, and the return of the market made the Li Ning Co sink into the shop.

According to the 2011 earnings report, Li Ning Co's inventory amounted to 1 billion 133 million yuan a year, causing its early warning in 2012.

In the fourth quarter of June 2012, the order volume of the company reached a two digit decline.

According to the 2012 earnings report, Li Ning Co's annual performance loss was 1 billion 979 million yuan, which is also the first time that Li Ning Co has lost money since its foundation.

Then, in the 2013 fiscal year, Li Ning Co lost 390 million yuan.

In the first half of 2014, the Li Ning Co continued to lose money, but the company had to close its stores to stop the loss. In the first half of the year, the company shut down 244 stores and cancelled 3 dealers. 2014

Lining himself said to Guan Guan: "we have adjusted almost more than 3000 times in the past two or three years. More than 3000 stores have been shut down, turned off, and optimized. Actually, we have lost some opportunities for offline channels, so in the next one or two years, we need to find the original market and find our original channels."

Statistics show that in June 2012, Li Ning Co had 6657 franchises, 646 Direct stores, and 20.8% direct sales. In June 2014, Lining had 4552 franchisees and 1119 direct outlets, accounting for 38.3% of its direct sales.

Ma Gang believes that the main reason for dragging down the Li Ning Co is that it is difficult to solve the channel problem in Direct stores.

In 2012, Li Ning Co lost nearly 2 billion yuan.

In those days, Li Ning Co launched a "channel revival plan", which cost 1 billion 400 million yuan to 1 billion 800 million yuan. It focused on supporting dealers to clean up inventory, buy and buy, and integrate sales channels.

In the past two years, in order to optimize the channel, Li Ning Co has been expanding its direct network and striving to get rid of the difficulties of the past wholesale mode.

"It used to be A dealer operation. Now Li Ninghua has a large sum of money to buy the channel control rights with A.

A provincial market needs at least a few billion, and a prefecture level market will cost tens of millions of dollars. "

"There are also a lot of dealers who can't manage," he said. "We need Lining to take over the market while causing bad debts to Li Ning Co."

The Li Ning Co semi annual report 2014 showed that the provision for bad debts was 683 million yuan in terms of provision for bad debts.

Facts have also proved that Li Ning Co has become the only 5 listed sports brand loss company in the first half of 2014.

Meanwhile, the number of Li Ning Co stores has shrunk from 8255 in early 2012 to 5671.

The 3 time series was raised by Anta.

Since its birth, Anta has followed closely behind the Li Ning Co. At the same time, it seized every strategic mistake of Li Ning Co and launched the catching up without delay.

In 2004, Li Ning Co abandoned the sponsorship of the CBA League, and Anta chose to follow up for the first time. The result was immediate. Anta's turnover increased from only 310 million yuan to 2011 yuan in the year, 8 billion 900 million yuan.

In 2009, Li Ning Co abandoned cooperation with the Chinese Olympic Committee. Anta once again hesitated to "leak out" and further - four years of packaging. The Chinese delegation will wear all the sports uniforms with Anta Logo on all sports events.

In August 2014, Anta replaced Lining and successfully signed the Chinese gymnastics team.

Until the formal signing of NBA in October 13, 2014, Anta went away on the road of naming sponsorship.

According to the 2012 earnings report, Anta's sales performance reached 7 billion 620 million yuan, while Li Ning Co was 6 billion 740 million yuan.

Next, Anta's leading edge has been expanding. 2013 annual earnings report shows that Anta's performance is 7 billion 280 million yuan, while Li Ning Co is 5 billion 824 million yuan.

The time for full pcendence was fixed in 2014. According to Anta's 2014 semi annual report, Anta's operating income was 4 billion 120 million yuan, and its net profit amounted to 803 million yuan.

Looking back at Lining's 2014 semi annual report, the data showed that its revenue was 3 billion 137 million yuan, and its net loss was 586 million yuan.

In addition to income, the market value of the two companies alternates.

As of August 19, 2015, Anta's market value was 52 billion 590 million yuan, while Li Ning Co's market value was 77.87 billion yuan.

Lining himself has reflected on the company's sales decline. He believes that the first is strategic error: "now Li Ning Co is very important that the strategy has changed.

The past industry model is basically wholesale and retail, and it is now going to lead to consumer demand, which has changed a lot.

Another change is that we used to focus on sporting goods, but the core business is not enough, which has become a turning point for the Li Ning Co's sales decline.

But looking at Li Ning Co's sales, it is behind the horse race.

In 2009 alone, Li Ning Co opened 1239 new stores with a total volume of 8156.

However, by expanding its performance, it also has hidden dangers.

After the Beijing Olympic Games, the Li Ning Co set up a new business development plan, which threatened to achieve 20 billion yuan revenue in 2013. At the same time, it focused on the international market and the 90 young people.

The most direct result of such a market strategy is the rise in product prices.

In one year, the Li Ning Co made three successive increases in prices, ranging from 7% to 17.9%.

Take sneakers as an example, the price is adjusted from two hundred or three hundred yuan to four hundred or five hundred yuan after brand remolding.

Such a price is obviously high for the consumers who are targeting. At the same price, why do they not choose Adidas, Nike and other foreign brands?

And sticking to the development mode has become the second major mistake of Li Ning Co.

Li Ning Co has been insisting on the development mode of production and sales outside. This mode has led Li Ning Co not directly facing consumers, but facing distributors and wholesalers from all over the country.

Therefore, Li Ning Co's product design is based on feedback from distributors and wholesalers, not the first reaction in the market, but slower in response to consumer demand and market.

After analyzing this model, Li Jin, executive director of the China Enterprise Research Institute, thinks that the most important strategic positioning and development mode errors of the company result in poor sales, high inventory and out of control supply chain.

The performance requirements of the listed companies are also a result of Li Ning Co's eventual personnel concussion.

It should be said that the Li Ning Co is in decline and the strategic positioning is wrong and the development mode is no longer suitable for the current development is the main reason, and the decline in performance is the result.

Lining is at the helm again, O2O.

Since the return of Lining, 2015 seems to be turning into a turning year. What is surprising is that in the past few years, the "sports veteran" and "low profile businessman" who have been out of the woods in the past few years have been hiding their attention in the study of Internet thinking.

Lining returned to the company, which also originated in November last year. Li Ning Co also announced that Kim Chun Jun had resigned as deputy chief executive, but he continued to serve as executive vice chairman and executive director of the board.

Last month, Li Ning Co issued a notice again, Jin Zhenjun resigned from Li Ning Co related duties.

TPG will appoint Wu Renwei as a non executive member and executive committee member, and will take effect in August 12th.

Statistics show that Wu Renwei, 58, worked in Procter & Gamble and PepsiCo Inc.

He joined Johnson consumer products department in 1989 and became president of Greater China in 2000.

He is currently the chairman of Johnson China and the member of Johnson Management Committee.

Ma Gang believes that the introduction of Wu Renwei is also his experience in the consumer product department.

Chongqing Youth Daily reporter found that in the spring of 2015, Lining opened Sina micro-blog for the first time.

In just two months, his fans surged to 510 thousand, and his first concern was Lei Jun, the head of millet.

In this year's national "two sessions", Lining was wearing a picture of millet Bracelet by Lei Jun.

Lining also openly said, "I admire Lei Jun's dedication. Chinese entrepreneurs need this spirit."

As early as March this year, Li Ning Co announced a strategic agreement with millet ecological chain enterprises and millet Bracelet developers, to jointly build a new generation of smart running shoes, and explore the health field of big data.

Since March 16th, Li Ning Co announced that from the traditional brand of sports shoes and clothing to the field of intelligent sports, Li Ning Co's stock price rose five days, and in March 19th and 20th it rose by 11.6% and 14.1% respectively.

The basic form of cooperation between Lining and millet is that Li Ning Co is responsible for the production of running shoes, and millet is responsible for intelligent research and development.

Its two smart running shoes are priced at 399 yuan and 199 yuan respectively.

In the Lining brand official online mall, Lining brand other running shoes prices are basically 200~500 yuan.

Obviously, Li Ning Co sold the smart running shoes and played a "millet strategy".

In Li Ning Co CEO Lining view, "Lining intelligent running shoes are trying not only to create product experience and break the price barrier, but also to create a three-dimensional ecological circle in the tide of Internet +."

Lining's so-called O2O mode is: from July 20th, the next store of Lining brand line will provide a try on scene for smart running shoes, and will start booking at Tmall flagship store, until August, 8 days to buy at Tmall Lining flagship store, Jingdong flagship store and Xiaomi online.

For this reason, Wang Liyang, an Internet analyst, told reporters that Lining had joined hands to find the right partners in the field of intelligence. The overlap rate between millet fans and target groups of Li Ning Co was higher.

But it is worth noting that Li Ning Co's share of the Internet sales in 2014 accounted for only 5%.

Ma Gang believes: "the strategic pformation of Internet + sports life experience providers is a general direction. Lining is right in this trend, but how to implement it is a short board for Lining team."

Ma Gang said that from the number of Internet users in China, consumer digitization is basically completed, and the difficulty is the channel, marketing and product digitalization of Li Ning Co. How to absorb consumers into the digital business platform of Li Ning Co through these digitization, Lining is now at the starting point of this runway.