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    Lack Of Innovation Crocs Three Pformation Is Difficult To Reverse The Decline In Performance

    2015/11/23 13:34:00 18

    China MarketPformationData

    Although the Chinese market is still full of expectations, Crocs, once popular with cave shoes, is now forced to close its stores in the Chinese market.

    But in the eyes of the industry, it is the key to the development of shackles, such as lack of innovation, slow update speed and traditional ordering mode.

    In the latest three quarter earnings report issued by Carlo, its operating income was $274 million 100 thousand, less than the $278 million expected by the market, down 9.4% from $302 million 400 thousand in the same period last year, and a net profit loss of 27 million 776 thousand US dollars, far less than the 12 million 9 thousand US dollars in the same period last year.

    In fact, for Carlo, the decline in performance and net profit losses are not the first time.

    After the decline in performance, this popular company has made many efforts, but the results of several pformation are not satisfactory.

    In 2007, Carlo began its first time.

    Transformation

    。

    The strategy focused on upgrading the hole shoe and began to set foot in the sports apparel business.

    The company has acquired Jibbitz, SamanthaBryan design companies and other enterprises specializing in the production of decorations for clocking shoes, allowing the cave shoes to be adorned with clothing and accessories, such as casual sportswear for adults and children.

    However, this series of measures failed to keep the popularity of cave shoes.

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    In 2008, a single type of cave shoes appeared unsalable in the Chinese market and a large backlog of stocks. The team then began the second pformation: snow cave shoes, expand product lines, and open diversification strategy.

    The so-called "snow storage" refers to the use of hole shoes as bait, placed on the inside of the shelf, so that consumers will first contact with other products of Crocco when they enter the store.

    At the same time, the company launched OceanMinded, CrocsWorkShoes and other series in China.

    brand

    Categories include high heeled leather shoes, slope heels, sports shoes, winter boots and leather boating shoes.

    However, these new categories were not recognized. In 2009, Carlo. Com had its first big loss since listing: $184 million.

    In 2012, Carlo suffered a loss of $3 million 607 thousand, and the net loss increased to $66 million 933 thousand in the four quarter of 2013.

    In 2014, because of its poor long-term performance, Carlo had to launch the global strategic reorganization plan.

    The content of the third pformation is simple: close shop.

    Carlo will close or restructure the world, especially 75-100 of the 600 direct outlets focusing on weak markets such as China, and dismiss 183 employees (3.6% of the total staff), and substantially reduce product lines, reduce the original 350 product lines by 30%-40%, while reducing direct investment in small markets.

    Last year, the pformation plan of "closed shop" was put forward and continued to spread to the Chinese market.

    At the end of the three quarter of this year, it launched a total of 557 stores in the world, a year-on-year decrease of 28.

    To strengthen core market business, Carlo said that some stores in vulnerable markets such as China will continue to streamline.

    Now, Carlo has come up with another plan to deal with the declining performance.

    It is understood that in January this year, CEO Gregg Ribatt, newly appointed Crocs, proposed to return the "Snow" hole shoes back to the market as a focal point for development, and to suspend the previous product category expansion plan.

    Carlo: "cave shoes are a big business, but these years are ignored by us."

    According to the TransparencyMarketResearch study, the value of the global footwear market is expected to reach US $211 billion 500 million by 2018, with a compound annual growth rate of 1.9% between 2011 and 2018.

    Among them, the Asia Pacific region is expected to account for 30.1% of the total footwear market.

    China's report hall data also show that the average annual growth rate of per capita disposable income of urban residents in China over the next five years is greater than 7%.

    With an analysis of 7% growth rate, it is expected that by 2016, the market scale of China's casual footwear industry will reach 125 billion 100 million yuan, with an average annual growth rate of 7.29%.

    In the face of such a market, Crocs would not want to be absent. At that time, the shoes of the cave appeared again.

    But for the return of cave shoes, the industry has expressed no interest.

    Many people in the industry say that the failure of Carlo is largely caused by the "lifeline" of Chinese market cottage products.

    Taking Nike, Adidas and other brands as an example, in the past decades of development in China, although it has always been the impact of imitation products, but due to the wide product line, with special emphasis on the development and promotion of "special edition, limited edition" and other high margin products, it has not lost the market under the impact of Shanzhai goods.

    But clo Chi was caught up in the fist product by a copycat, resulting in a decline in sales.

    Although Carlo has also tried to suppress imitation products by raising prices, it has had little effect.

    Behind this phenomenon, it is the slow update speed of Carlo and the short tradition of ordering mode.

    Earlier information showed that within the company, it took almost 18 months for new products to have a preliminary idea and final listing.

    Some brand new products launch cycle is only 15 days.

    In addition, the order pattern of the company is to open orders and place orders, which also delays the birth of products.

    At UTA

    fashion

    Yang Dayun, President of Management Group China, seems to be very attractive to the public in the field of aesthetic fatigue. Therefore, the key is whether the veteran can make meritorious service again. The key is to look at innovation, which is related to the product innovation, updating speed and order mode of KLOE Chi.


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