The ODM Behind The Screen Is Going To Be On The New Third Board. What Does The Data Reveal?

Hon Rui Feng's profit model mainly consists of three parts: 1. ODM mode.

2. general trade pattern.

3. owned

Pattern.

Despite sustained profit in the reporting period and slow rise in net interest rates, the overall profitability is weak. Macroeconomic fluctuations, weak consumption and corporate management will become a hidden worry for Hsin Ruifeng.

The limited cash flow leads to the obvious demand for capital and endorsement of capital, which is perhaps the main reason why Hsin Ruifeng still wants to register the new three boards.

2015 double 11, Danish bestseller

The group's total turnover exceeded 520 million yuan, ranking first in the clothing group's ranking, and its Jack&Jones is second of men's clothing category.

As one of the first international brands to enter the Chinese market, Bestsellers

The market and channel capabilities are verified in the sales figures.

Behind it, a team of more than 20 people who designed and sold products for ten years, quietly submitted the application of the new three board listing in August 5th.

People may not notice that some styles of the brand of JACK&JONES, SELECTED, and so on, come from the clothing ODM supplier (Original design manufacture, original designer), established in 2002.

Its full name is Beijing Xuan Ruifeng still Polytron Technologies Inc, mainly for international clothing brands including ZARA, including clothing, textiles, and fashion electronic products design, development and sales.

According to the public pfer instructions, during the reporting period, in 2014, 2015 and 2016 1-4, the net profit of Xuan Ruifeng was 8.18 yuan, 411 thousand and 600 yuan and 334 thousand and 400 yuan respectively, and the net interest rates were 0.30%, 1.97% and 1.99% respectively, and gross margins were 25.50%, 27.94% and 19.32% respectively.

In fact, many ODM standing behind the clothing brand have grown into giants.

For example, Jiangsu golden Feida clothing Limited by Share Ltd was listed on the Shenzhen stock exchange in 2008, and gradually pformed from ODM business to OBM to create a clothing brand design production chain.

From the above data, Hsu Ruifeng still has weak profitability, big customer dependence and obvious design barriers. How should it go next?

ODM is the main profit model, trying to create its own brand.

The profit model of Xuan Ruifeng still consists of three parts.

1. ODM mode.

Hsuen Feng Feng, who has signed a framework agreement with the brand customers, has agreed on the contents and methods of the processing, product quality requirements and settlement methods. After that, a series of accessories has been designed according to the requirements of the brand styles, and the products selected from customers have been handed over to the production plant for mass production, and then sold to the brand customers.

On this basis, the Xuan Rui Feng Shang Tuo expanded the ODM business of some domestic clothing brands, including Liaoning Chiba, hot wind, Semir and so on.

2. general trade pattern.

Xuan Ruifeng still purchases direct garments such as nartikas and sells them directly to earn profits and earn profits.

In 2016, Hon Ruifeng also established business cooperation with sales company run by Dexing electric power company and tried to expand online sales channels.

3. private brand mode.

Since 2014, Xuan Ruifeng has established its own brand Great Tailor and sells it in stores in Chongqing and Hangzhou.

Among them, the Hangzhou department store store closed in mid 2015, due to sales failure.

At present, the sales volume of this brand is relatively small, but relying on the advantages of its own design and supply chain integration, it does not rule out the possibility of sustained growth in the future.

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Big customers depend on profitability.

According to the public pfer instructions, in 2014, 2015 and 2016 1-4, the sales proportion of the top five customers was 97.35%, 99.65% and 99.65% respectively.

Among them, the average proportion of bestseller fashion (Tianjin) Co., Ltd. is about 70%, and the concentration ratio of large customers is relatively high.

On the other hand, it can be seen from the industrial chain of clothing industry that the business of leather luggage design is in the middle reaches of the industry, and the downstream brands are always in a strong position. Therefore, customers' choice and ordering of products directly determine the key points of the company's product management.

Despite sustained profit in the reporting period and slow rise in net interest rates, the overall profitability is weak. Macroeconomic fluctuations, weak consumption and corporate management will become a hidden worry for Hsin Ruifeng.

It is worth mentioning that, because Xuan Ruifeng is still the main research and design of men's clothing brand leather products, it belongs to the typical ODM mode, so the value-added ability in the design link is more obvious, resulting in higher gross profit margin than some peers.

A comparable object is the consumer clothing product based on the more fashionable foundation of Chuan Cheng fashion. The market competition is extremely fierce. The downstream customers are strong. They even prefer to buy products under the OEM mode. The value added capability of the design link is not reflected, resulting in a low gross margin.

Need financing to enhance competitive advantage

From the perspective of cash flow, Xuan Ruifeng is still realizing the cash inflow of positive business activities, which increased from 2014 -332.11 in 2016 to 7 million 35 thousand and 700 yuan in 1-4 months in January.

The report pointed out that this change is mainly due to its improved inventory control capabilities, changing the previous high inventory operation mode, and reducing procurement capital occupation.

However, the limited cash flow leads to the obvious demand for capital and endorsement of capital, which is perhaps the main reason why Hon Rui Feng wants to register the new three boards.

In February 2016, Xuan Ruifeng completed a round of internal financing, increased by 3 million 800 thousand yuan from shareholders of the company, equivalent to 21.46 yuan per registered capital, with an overall valuation of 1 billion yuan.

In the development trend of significant increase in net profit, as a main asset light company, Xuan Ruifeng is still trying to win more advantages in the relationship between big customers and competitors.