CABBEEN Apparel Profits Fell 31.5% In The First Half Of The Year

For business income and net profit decrease,

The decrease in retail revenue is mainly due to the decline in sales and the increase in retail discounts.

The decline in net profit is due to reduced sales revenue, increased inventory and return, and increased operating expenses.

Considering that the macroeconomic environment is weak and online shopping is becoming more and more obvious,

Closed shop with poor performance and slowed down new retail outlets.

As of June 30, 2016, CABBEEN clothing had 1012 stores, compared with 1059 in December 31, 2015, a decrease of 47.

Transformation from retail store to consignment mode

To grasp the huge opportunities of the online consumer market,

The retail business in wholesale mode is gradually being pformed into a consignment mode.

As of June 30, 2016, 422 (December 31, 2015: 319) retail outlets had been successfully pformed into a consignment business, accounting for 41.7% of the total retail stores (December 31, 2015: 30.1%).

Most of the shops are sold in Guangdong, Guangxi, Hainan, Fujian, Anhui, Jiangsu, Zhejiang, Guizhou and Shaanxi provinces.

We plan to increase the number of retail outlets operated in the next few years.

Therefore, the retail business will be further increased in the future. This mode will help improve operational efficiency and attract more distributors to expand the retail network in the local market.

The idea of CABBEEN apparel management retail store is to regard retail stores operated by distributors as self operated stores and end customers who choose products from retail outlets as their own customers.

CABBEEN apparel carries out centralized management and control over distribution networks to ensure that the brand concept is fully reflected, the inventory management is well managed and implemented at the retail sales level.

Sales and promotion strategy, so that CABBEEN clothing can quickly respond to market changes.

Shop and sell products on Tmall and its official website.

As of June 30, 2016, the online retail revenue of CABBEEN apparel in 6 months increased by more than 73% compared with the same period in 2015.

CABBEEN believes that through online shops, we can further promote the brand, so that enterprises can grasp the huge opportunities of the online consumer market.

Adhering to multi brand strategy and reforming supply chain

For future development, CABBEEN apparel said that the mainland's macro-economic environment is weak and consumer sentiment is low. It is difficult to make significant improvements in the short term. However, the continued growth of the middle class will continue to stimulate consumer spending in China, which will bring huge growth opportunities for CABBEEN clothing.

We will continue to maintain a multi brand strategy to provide a richer variety of clothing products and enhance product performance.

CABBEEN apparel said that in the second half of 2016, it would be more prudent to assess inefficient shops and slow down the pace of opening new retail outlets, and continue to improve operational efficiency and implement more stringent cost control measures.

It will also reform the supply chain to shorten product development and procurement cycle.

It is also announced that quarterly orders will no longer be held to receive orders from distributors.

However, the order will be received from three to four batches per quarter, and the purchase order will be sent to the supplier.

In addition, the current consumption patterns are changing. CABBEEN apparel will develop the mobile platform under the social media and upgrade the ERP system to match the online and offline distribution channels.

"We believe that the ERP system plays an important role in managing the distribution network.

It not only manages procurement and supply chain information, but also tracks the payment, rush and sales records of every product.

We can track and monitor the purchase, sale and inventory of each sub sales and two level distributors in real time, so as to monitor their inventory level.

This can provide first-hand information on market trends and customer preferences, so that the group can make more efficient and accurate sales forecasts, provide procurement guidelines to distributors and manage distribution network inventory.

CABBEEN said.