Clothing Enterprises Are In Danger: How To Seize Strategic Opportunities?

In 2015, the ups and downs of the stock market were impressive. In the first half of the year, the super bull market was coming.

Enterprises are also in this wave of bull market, capital movements are frequent, story telling investment pformation, shareholder reduction cash flow action.

After the A stock market crash hit, the national team entered the stock market, after thousands of stock trading, thousands of stock down, thousands of stock suspension miracle, clothing enterprises listed on the road was also cut off.

Now that the global stock market crash is coming, the major stock indexes in the world have plummeted, the Shanghai Composite Index has fallen below three thousand points, and returned to the beginning of the night.

But danger is organic.

Regardless of whether the stock market crash is going to happen, whether the worst case has passed or not, the situation of this plunging boom is unusual.

In the bubble, rubbish is often overestimated, and good products are often underestimated.

A better attitude is to set our sights higher and put it in the long run.

In the first half of the year, bull market

While promoting the pformation and upgrading of the industry, capital also has the tendency of speculation and misappropriation with "foam". In the 6 month's stock market crash, Hua Shang Hui pointed out that

In the collective action of tumbling, we must find the power of reason and value; in this global stock market crash, garment enterprises must dance with the crisis in a larger pattern, seek new opportunities in turbulence, create new value and power of pformation and upgrading.

Strategic opportunities faced by garment enterprises in Turbulence: endogenous growth, internationalization and capital market reform

First is the opportunity of endogenous growth.

Under the background of China's economic slowdown, the apparel industry led by sports apparel began to recover, which is the result of the dual role of domestic economic pformation and upgrading power and the endogenous value growth of the apparel industry.

In August, the initial value of PMI in Caixin manufacturing industry was 47.1, the lowest in March 2009, and the six consecutive month under the ups and downs line shows that the downward pressure on the economy is increasing.

The central bank announced a double drop in August 25th evening, reducing the benchmark deposit and lending rate by 0.25 percentage points, while reducing the deposit reserve ratio by 0.5 percentage points. The intention is to release liquidity and boost the real economy.

The clothing semi annual report shows that before the homogenization of serious sports apparel industry has begun to go out of high inventory, large-scale closings, declining performance, showing a revival trend.

PEAK,

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Sports brands such as China's trend have reported good news. Lining's profit before tax, plus depreciation and amortization has already turned into a deficit.

This phenomenon shows that, first, the sports apparel and garment industry has begun to establish its own more rational and rational business models in the process of adjustment. Two, the development space of the garment industry is still very large. Various measures and policies have proved that expanding domestic demand, promoting consumption upgrading and developing service-oriented economy are the focus of China's economic pformation, and the driving force for long-term and stable development of China's economy is strong. Three, capital will promote sports apparel and the whole garment industry to integrate. The stronger the stronger, the weaker will be eliminated, and then the merger and acquisition will become the norm of the garment industry.

The second is the opportunity of capital internationalization.

In the global stock market crash, the sharp fall in the A share market and worries about China's economic slowdown are the main reasons for the global stock market crash. China's economic structure and capital market have been more closely linked to the global market.

This year, we obviously see that the internationalization of the local garment industry is deepening. One of the manifestations is that fast fashion abroad continues to attack the domestic market. From August 15th to 20, UNIQLO has opened 5 stores continuously.

In addition, fast fashion began to speed up the sinking of the channel. According to statistics from the relevant agencies, the proportion of two or three cities in the ten fast fashion new stores in the first half of this year accounted for more than 75%.

The other is the rapid development of cross-border electricity providers. Cross-border electricity suppliers have become the "public lover" of garment enterprises. The enterprises such as hundred circles trousers industry, Semir clothing, 31st degree, fuanna and Fugu birds have arranged cross-border electricity providers.

At the same time, clothing capital is also seeking to "go out", such as YOUNGOR and CITIC shares strategic cooperation, which involves the "one belt and one road" to participate in the international market development and development, and on the platform of cooperation to YOUNGOR brand to the international market, and the introduction of International brands.

More international investment events during the year include: CITIC Capital's acquisition of Japanese apparel company MARK STYLER intends to vigorously expand the domestic market; Semir invested 115 million yuan to participate in the Korean business ISE, plans to open international joint venture brands in China, and invest 20 million euros in Spanish football brokerage companies; and so on.

Whether it is financial capital or industrial capital, the degree of internationalization of fashion capital will be further deepened.

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The third is the opportunity for capital market reform.

During the year, the stock market plunged, and the various irrational phenomena and behavior of the capital market caused concern that the reform of the capital market would not stagnate.

On the contrary, this phenomenon highlights the necessity of China's capital market reform, and the reform will further increase.

In recent years, the central bank's double fall, on the one hand, in order to stabilize the real economy, on the other hand, it is also stable capital market expectations, and the pension market entry, it shows that China's capital market reform has not been reduced.

The huge pension market can help build a multi-level capital market and enhance the openness of the capital market.

The general trend is that the capital market will develop towards a more diversified, more open, more hierarchical and more mature direction.

Registration system will not stop, but will be more stable, clothing enterprises enter the capital market access will be more diverse.

For the listed garment enterprises, after the sharp fall of the stock market, the understanding of market value management and corporate governance will be more profound and means richer and more mature. All these will urge the garment enterprises to make use of the capital market to develop leapfrogging, giving birth to the comprehensive clothing group with high market value, and eliminating the inferior ones and promoting the further integration of the industry.

Dancing with the crisis, realistic planning behind the strategic opportunities of garment enterprises

Facing strategic opportunities, but whether we can grasp or not be good at using is another matter.

For garment enterprises, everyone is equal before the opportunity, and whether they can stand out from the crowd is to see their own "good fortune".

Behind the opportunities are more intense competition and more severe survival of the fittest, which also means the possibility of leaping development.

For now, behind these strategic trends, garment enterprises can generally focus on the following aspects.

First, clothing enterprises should still focus on the optimization and pformation of the main industry.

At present, the pformation and upgrading of garment enterprises basically follow the mode of "industry + investment", and the industry is the main garment industry itself. The main industry can provide more cash flow, which will provide greater support for investment pformation.

Under the cold winter, cash is king, while expanding and paying attention to the accumulation of grain and grass, the rationale is basically the same.

From the current semi annual report, clothing companies generally have a certain foundation in cash reserves.

An important action to increase the cash flow is to optimize the terminal channel, enhance the efficiency of single store and increase the same store, which requires garment companies to be more professional.

Behind the strategic opportunities of endogenous growth is the trend of "specialization" in essence, to cater for the huge consumption demand of the middle class and the mass consumption layer, and to cater for the pformation needs of the country's service-oriented economy. The products are more professional, and the brand is more fashionable and experiential.

Therefore, on the basis of being steadfast in the main business, we should also lay stress on the "capital story".

In the process of the stock market crash and boom, many irrational phenomena occurred.

For example, the stock price soared after the change of name, and some small cap stocks surged, with some concepts of stock prices being stopped immediately, and "women in the king" pursued in the rescue market.

Aside from various reasons for the stock market, it is hard for enterprises to support the high valuation and future growth expectations of the capital market if they fail to cash in on storytelling.

Clothing listed companies are generally small and medium sized stocks in growth market. They have frequent capital movements in bull market. They also tell many stories and concepts. The best way is to seize the strategic opportunities of capital market reform, focus on the value factors behind stock market and concept, and do well in landing skills. This is the right way to make good use of capital market to achieve leaping development, and show the strong power of "capital story".

Thirdly, the internationalization trend of fashion capital provides a new global layout opportunity for garment enterprises.

Under the collapse, the merger and acquisition movements are often followed.

Clothing companies can not only focus on local mergers and acquisitions and resource integration, but also have strong vision for fashion enterprises to pay more attention to the trend of global fashion capital.

Affected by the devaluation of the RMB and the global stock market crash, the LVMH, Hermes group, the peak group and Burberry group fell more than 10% in March.

For companies whose performance is down, they are more likely to become the targets of mergers and acquisitions, such as the recent rumors of Li Feng's involvement in mergers and acquisitions, behind which its core profits plunged nearly 20% in the first half of the year and the stock price has fallen by nearly 25% this year.

If we say that doing well in the main business is cash, it is the realization of business income. If we talk about capital story well, it is to realize business mode and increase profit growth point in the future. Merger and reorganization is a higher level capital income. It is the embodiment of capital thinking of clothing enterprise resource integration, and a leap way for enterprises to become stronger and bigger.

Local clothing enterprises should have the mind, thinking and preparation for establishing fashionable pnational groups. Such things may not happen immediately, but the future will happen, and the times are providing us with such strategic opportunities.