Giordano Will Set Up Branch Offices In Vietnam To Continue Upgrading Its Electricity Business

In the Chinese market,

It can be considered a brand of history.

But in recent years, with the rise of fast fashion, all kinds of Korean currents, European and American wind and so on are gradually favored by consumers. Giordano gradually becomes "old and honest". The old fashion brands represented by them are embarrassed under the attack of new brands.

In the afternoon of March 3rd, Giordano (00709, HK) announced its performance as of 2015. Its annual sales volume was HK $5 billion 381 million, down 3% from the same period last year. Net profit was HK $426 million, an increase of 4% over the same period last year.

Part of the net profit comes from closing stores and reducing losses.

Reporters noted that Giordano adjusted its business strategy last year, closing some of the lost stores, reducing the number of stores by 81, and making its profits increased by HK $57 million.

In addition, its operating profit increased by HK $3% to HK $556 million from HK $542 million in 2014.

This is Giordano's overall sales decline for the second consecutive year.

Giordano also admitted that the market of its layout in 2015 was weak in consumer demand.

However, according to the information disclosed in its announcement, this year will continue to increase its code in response to the current market situation.

Business and plan to

Set up a branch office.

There are still 80 loss shops in the mainland.

All along, the mainland market is the main position of Giordano.

In 2015, consumer demand was weak in the global market, but the performance of the mainland market was relatively bright.

According to Giordano's performance report, operating profit in mainland China increased last year, from 53% HK $90 million to HK $90 million in 2014, and operating interest rate rose from 3.7% to 6.2%.

Giordano said that this growth came mainly from three aspects: shutting down poorly performing shops, reducing losses, reducing logistical costs, increasing sales of self owned stores and franchisees, as well as core portfolios of online platforms.

Reporters noted that by the end of 2015, Giordano had 891 stores in the mainland, compared with 961 at the end of 2014, a net decrease of 70.

However, so far, Giordano still has 80 loss shops in the mainland (145 in 2014), of which 18 are "serious losses", which has a greater impact on 2015 profits.

Giordano also said that it had eliminated the unprofitable shops last year, which also led to a reduction in sales in 2015.

Giordano's performance in Hongkong and Taiwan is relatively low.

The annual sales of its Hongkong market decreased by 1% to HK $971 million from HK $978 million, and its operating profit decreased from HK $75 million to HK $70 million, a decrease of 7% over the same period last year.

The annual sales of the Taiwan market decreased by 3% to HK $639 million from HK $662 million, and its operating profit also decreased from HK $55 million to HK $49 million, a decrease of 11% over the same period last year.

A branch will be established in Vietnam.

Founded in 1980, Giordano specializes in the retail of low and medium casual wear, and in Hongkong in June 1991.

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In recent years, with the rise of fast fashion, Giordano's main T-shirts are no longer the main choice.

Xiong Xiaokun, a light industry researcher at CIC, told reporters that the strong invasion of the clothing industry by the electricity supplier also grabbed Giordano's market share.

In 2014, because of continuous decline in performance for many quarters, Giordano made adjustments on its brand to help itself by multi brand strategy.

Based on this, it has launched the cheap brand BeauMonde (BM) and the leisure Women's brand "EULA", which focuses on high-end department stores.

Previously, a clothing industry told reporters that shopping malls are very concerned about brand lineage when investing.

Based on the current market awareness, as a subsidiary brand of Giordano, EULA will be more difficult to enter high-end stores.

The result verifies the judgement of the person.

According to the latest performance report, Giordano has opened 9 EULA stores in the past two years, but the brand has been terminated within the year because of its unprofitable business.

Meanwhile, another new brand, BM, is still at a loss.

However, as an old fashion brand, Giordano is still hopeful for its future development.

In addition to continuing to develop the BM brand, it is also considering the establishment of a branch in the Vietnam market.

"We will consider setting up a branch in Vietnam in 2016 to provide support for the steady growth strategy of this emerging market."

In the announcement, Giordano chairman Liu Guoquan said.

Insiders pointed out that although Vietnam's demand for clothing is not attractive compared with that of China, the competition in China's clothing market is fierce, and the continued development of the Vietnamese market will bring new achievements.

It is worth noting that the Giordano side also revealed that it will continue to increase the electricity business.

"In 2016, we will consider growth through the existing third party platform partnership and will consider investing more in digital marketing to achieve this goal."