After Many Years Of "Not Doing Business", YOUNGOR Began To Make Efforts In Clothing Industry.

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In the latest statement, we will invest 10 billion yuan in the next five years to strengthen the innovation of new materials, new fabrics, new processes, new brands and new services.

At the same time, signed a cooperation agreement with five top international fabric brands, which cost 30 million yuan to build YOUNGOR's home.

In recent years, YOUNGOR has been making efforts in garment industry after many years of "doing nothing".

In this regard, YOUNGOR Securities Department staff revealed that with the tightening of real estate policy, investment income instability, YOUNGOR intends to revive the clothing sector.

But in the industry view, in recent years, the domestic apparel industry is rather sluggish, and every men's clothing brand is facing a survival crisis or seeking pformation. Under such circumstances, the road of YOUNGOR's return is not smooth.

In recent years, real estate and financial investment has long been the main source of YOUNGOR's revenue, and the clothing sector has been on the brink for a long time.

According to the three quarterly report released by YOUNGOR this year, the apparel sector achieved a business income of 2 billion 956 million yuan and a net profit of 323 million yuan. In the same period, the real estate development business achieved 7 billion 433 million yuan in operating income and 1 billion 214 million yuan in net profit, and realized 2 billion 919 million yuan in investment income and 1 billion 654 million yuan in net profit.

Real estate and investment revenue is much higher than the profit brought by the clothing sector.

According to the announcement, YOUNGOR signed a strategic cooperation agreement with five top fabric manufacturers from Europe. It said it would build China's high-end garment and custom brand MAYOR, and will invest 10 billion yuan in the next five years to strengthen the innovation of new materials, new fabrics, new processes, new brands and new services.

For big investment, YOUNGOR further disclosed that in April, the company raised 3 billion yuan through non-public offering shares, and will raise 5 billion yuan in the next five years.

In addition, the company will invest 2 billion yuan to implement "membership strategy" and "multi brand strategy".

At the same time, YOUNGOR also increased the number of offline stores.

At the end of September, the company purchased about 30 million yuan in Wuxi and officially opened its "YOUNGOR house" brand.

Last year, YOUNGOR invested in Shanghai to build the nation's first "YOUNGOR home", which also cost 20 million yuan.

Such a "YOUNGOR house", which covers an area of more than 2000 square meters, is also an important move for YOUNGOR to promote the "big store mode".

In the first half of 2016, YOUNGOR invested 506 million yuan to promote the "big store strategy".

YOUNGOR has publicly stated that in the next five years, the existing more than 3000 stores will be reduced to about 1000 stores, and the business volume will be doubled, with an annual revenue of about 10 billion yuan.

Liu Xin, an employee of YOUNGOR securities, said in an interview with reporters that increasing the investment in the clothing sector and pulling the garment business again, besides chairman Li Rucheng always attaches importance to the company's clothing production business, it is also related to the tightening policy of real estate in the past two years.

This year, the real estate policy of the country has been tightening up, which has a great impact on YOUNGOR's real estate sector revenue.

The real estate development business achieved 7 billion 433 million yuan of revenue, a 17.88% decrease from the same period last year, which directly led to 10 billion 519 million yuan in the first three quarters of this year, down 14.95% from the same period last year.

Go downhill

As early as 2011, in the clothing sector, YOUNGOR has put forward the "production and operation oriented to brand operation pformation" plan, and for five years, there has been no obvious action.

Although YOUNGOR is full of ambition in clothing today, the impact of the declining development of the entire garment industry should not be underestimated.

In the first half of this year, the sales growth rate of China's garment industry continued to slow down, and the performance of apparel listed companies continued to decline.

YOUNGOR's past five years' annual report also shows that the performance of its clothing sector is not very satisfactory.

YOUNGOR's brand clothing business has been on the downhill since 2013.

The clothing revenue reached 4 billion 269 million yuan in that year, but its net profit was only 643 million yuan, which was significantly reduced by 21.37% compared with the same period last year.

In 2014, the clothing sector continued to slide, operating income of 4 billion 133 million yuan, down 3.21% from the same period last year.

Last year, YOUNGOR's clothing sector revenue increased slightly compared with last year, with revenue of 4 billion 461 million yuan, an increase of 1.48% over the same period last year, but net profit declined, down 0.23% compared to the same period last year.

The three quarter report released by YOUNGOR in 2016 showed that its apparel sector achieved a business income of 2 billion 956 million yuan, 5.5% lower than the same period last year, a net profit of 323 million yuan, a decrease of 42.45% over the same period last year, and a decrease of 395 million yuan net profit in the two quarter of this year.

The YOUNGOR's high-end line is bound to increase its cost investment in the short term, and it can not provide timely support for the declining garment performance.

Kang Lanxin, Dean of the clothing and accessories college, believes that the development of "big shop mode" and the creation of high-end brands are the right direction for clothing enterprises. But this kind of business built on huge sums of money can not achieve good revenue in the short term.

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Unspeakable and smooth

In an interview with reporters, Liu Xin said that the company has always attached importance to the development of the clothing sector, but YOUNGOR's investment in real estate and investment for many years is obvious to all.

As Li Rucheng told the media before, investment can earn 30 years of manufacturing money, YOUNGOR also early involved in real estate, investment areas, and achieved brilliant results.

Some investors have suggested that YOUNGOR should be renamed "Ya investment bank", because investment income is the main position in the company's revenue.

Although Li Rucheng said YOUNGOR would not abandon the clothing industry, compared to real estate and financial investment, the garment sector has long been falling behind in business revenue and operating costs, becoming the de facto marginal business.

In the past years of YOUNGOR's "flower heart", the domestic brand dedicated to developing men's wear has maintained a good momentum.

The seven wolves, whose main business is the clothing sector, has been growing since 2014. The three quarterly earnings report has increased 1.29% to 1 billion 790 million yuan over the same period.

Clothing plate accounted for more than 90% of the business men's clothing brand wedding bird, business income also increased from 1 billion 944 million yuan in 2011 to 2 billion 242 million yuan in 2015.

The clothing industry as a whole is in decline and Europe and the United States rush to eat, coupled with the constant expansion of the brand of men's wear and the years of "doing nothing". It is not easy for YOUNGOR to show itself in the fierce competition.

YOUNGOR is also expected to return to the difficulty. For the promotion of the high-end brand MAYOR, Liu Xin said that the brand is mainly customized and ready-made clothing restructuring, fabrics are also high-end, sales will not be too large, MAYOR has no high expectations in the income generation, its profit is also difficult to compare with the main brand "YOUNGOR", more hope to create a good brand effect.

In the view of independent fashion critic Ma Gang, "the domestic men's wear brands are too concentrated on the development of the high-end men's clothing, but rarely have the low-end market of brand layout."

This also means that YOUNGOR, which will continue to develop high-end men's clothing brand, will face great competition pressure. MAYOR will have less chance to encirclement.

In addition, YOUNGOR may encounter some difficulties in the development of the garment sector. Kang Lan Xin suggests that enterprises should pay attention to controlling the scale of expansion and not invest too much at once.

According to the fund situation, choose a reasonable and safe scale of investment.

Because the big market still has risks, if the high-end consumption ability is curbed, too big investment will bring a lot of losses.