Brief Description Of The Pformation And Upgrading Of Hongkong Apparel Retail Enterprises Themselves

In this period, we turn our attention to the Pearl of the Orient: Hongkong.

According to the world clothing and shoe net, compared with the mainland market, Hongkong market is capital.

Or the retail market is relatively mature and has a longer history.

We can find that the number of clothing enterprises in Hong Kong stocks is much larger than that in A shares, while Hongkong's local businesses are more likely to have more clothing companies.

Retail enterprises are also experiencing more rounds of growth cycles, and also have their own "pformation and upgrading".

We selected several relatively large scale, representative Hongkong clothing retail enterprises in each clothing subdivision industry to see what happened in 2017.

I.T: Mainland revenue exceeds Hong Kong and Macao to further increase mainland market

In November 13, 2017, I.T Limited issued the mid-term report of the company 2017/18 in the year of August 31, 2017. In the half year of August 31, 2017, the company's total turnover amounted to HK $3 billion 652 million, an increase of 0.2% over the same period last year, with a net profit of HK $60 million 400 thousand, an increase of 54.5% over the same period last year.

From the perspective of market, I.T and Hong Kong and Macao markets perform poorly, and mainland and overseas markets perform better, especially in the mainland market.

According to the report, the turnover of Hong Kong and Macao was HK $1 billion 467 million during the I.T period, down 11% from the same period last year, and the same store sales decreased by 6.9%. Net profit loss was HK $112 million, narrowing compared with a loss of HK $113 million in the same period last year.

The report said that Hongkong's macroeconomic environment fluctuations and regional geopolitical risks, weakened consumption power of inbound tourists, and Hongkong people's more overseas travel and consumption abroad affected Hongkong's retail market performance. In the second quarter, sales were also adversely affected by the unstable weather and multiple typhoons in August.

Compared with the Hongkong market, the mainland market looks bright.

The report shows that mainland China's turnover in the I.T period reached HK $1 billion 674 million, an increase of 4.8% over the same period last year, accounting for 45.8% of the total revenue.

The share of revenue in Hong Kong and Macao fell from 45.2% last year to 40.2% this year.

Net profit was HK $95 million 300 thousand, an increase of 16.2% over the same period last year.

The company said it will continue to expand in the Chinese mainland market and expand the coverage area of new brands and existing brands.

At present, the company has shops in 29 cities in the mainland.

In addition, I.T announced in August 2017 that the joint venture company, the old Buddha, China and the A share listed company, entered into a letter of intent on opening the "Galeries Lafayette old Buddha" department store in Lujiazui center, No. 889 Pudong South Road, Pudong New Area, Shanghai, Lujiazui.

The department store has an area of about 23 thousand and 100 square meters, and Lujiazui will assist Lord Buddha in decorating the department store. It is expected to open in the second half of the fiscal year ended February 28, 2019.

Baozi: maintain growth momentum, push young brands and get involved in E-commerce

High-end

Baoji international, the parent company of Baoji, the brand retailer, showed that the company's performance continued to grow. In the 6 months ended June 30, 2017, the company's revenue was 1 billion 52 million yuan, an increase of 17.9% over the same period last year, and the profit attributable to shareholders was 5 million 456 thousand yuan, up 22.2% from the same period last year.

Bao International believes that the company's revenue growth is mainly due to the improvement of luxury fashion retail environment, and the company's core brand "Ports1961" and the newly launched brand "PortsPURE" are recognized by fashion enthusiasts.

On the one hand, the company will consolidate the core brand status of Ports1961, and on the other hand, it will promote "PortsPURE" to target the light luxury market.

In 2016, Baoji reversed its performance downturn. In the first half of 2016, the company's sales volume reached 893 million yuan, up 5.3% from the same period last year, of which retail revenue reached 813 million yuan, up 4.4% over the same period last year.

At that time, the company said that Future Ltd would diversify the market, expand the business of e-commerce channels, take multiple brand lines, and possibly acquire designer brand and enrich its brand diversity.

In October 2017, Baozi held the 2017 autumn winter #LOVE capsule series China's first event in Shanghai, and selected Jingdong as the first line platform for the new line of products.

In terms of multi brand, brand younger and electricity supplier, Baozi has acted in these two years.

Information shows that baozi mainly promotes and sells its brand products through joint ventures in department stores, retail outlets in high-end shopping centers and independent flagship retail stores.

These retail outlets are distributed over 50 Chinese cities, including Beijing, Shanghai, Chongqing, Shenzhen, Tianjin, Xi'an and Dalian.

As of June 30, 2017, the company operates 356 retail outlets in mainland China, Hongkong, the United States and Canada, compared with 343 stores in the same period last year, with a net increase of 13 stores.

The main business market of the company is in the mainland of China.

Daphne: performance is still down channel, 2017 as a pitional period of pition.

Women's shoes enterprises Daphne's performance in 2017 is still in a downturn.

In October 25, 2017, Daphne announced that the sales of its core brand business in the same store had dropped by about 15% in the 9 months ended September 30, 2017.

As for the reasons for the decline, Daphne said that, mainly in line with brand innovation, the third quarter of the year did not follow the local industry for a substantial discount.

At the same time, in order to cooperate with the new brand image, Daphne has adjusted the sales channel portfolio.

In addition, Daphne also said that because of the different time of the Mid Autumn Festival (2017 in October and 2016 in September), it also had a negative impact on the same store sales in September 2017.

At the same time, the company disclosed that in the third quarter, Daphne closed 375 sales outlets, including 367 Direct stores and 8 franchisees.

As of September 30, 2017, its core brand business had a total of 3917 sales outlets.

Daphne refers to the core brand business, which refers to the retail business of the footwear products and accessories sold by the company in China, including its own brand "Daphne" and "shoe cabinet".

According to Daphne's 2017 China Daily, the core brand business revenue accounted for about 86% of the company's total revenue in the 6 months ended June 30, 2017.

The rest of the other 14% brand businesses refer to their business and high-end brand businesses, including brands in mainland China, Hongkong and Taiwan, and exclusive distribution rights, such as "love", "STEP HIGHER", "soft" and "ALDO".

And Daphne's brand innovation and product upgrading measures were mentioned in the 2017 China Daily.

Daphne said that the design and production of autumn and winter products, which were responsible for the upgrading of the design team in 2017, are progressing smoothly.

In addition, the company launched organizational restructuring at the end of June to promote brand management and support business pformation.

In addition, the company plans to launch Daphne's new image store in the coming months.

At the same time, the company will strengthen the interaction with online and offline customers through online stores and social media platforms, promote the development of e-commerce business, take more O2O measures, and continue to develop the full channel scheme with offline store network.

Daphne's 2017 China Daily reported that the company's turnover amounted to HK $2 billion 733 million in the six months ended June 30, 2017, a decrease of 19.6% compared to the same period last year, and the deficit of shareholders accounted for about 209 million Hong Kong dollars, an increase of 28% over the same period last year.

The company said 2017 will be an important pition period for group pformation.

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Li Bang: Shandong Ruyi holdings, mainland market performance growth momentum

Hongkong's high-end men's clothing retailer Li Bang has been controlled by the mainland textile and Garment Group.

In November 10, 2017, Li Bang announced that the company entered into a subscription agreement in November 8, 2017. It intends to allot 1 billion 846 million shares to the subscriber Shandong Ruyi international fashion industry Klc Holdings Ltd, accounting for about 105.70% of the issued share capital of the company, and about 51.38% of the issued share capital after the expansion.

The subscription price is HK $1.20 per share, which is about 60% higher than the closing price in November 8th.

Immediately after completion, the subscriber and his co operative will own 1 billion 867 million shares of the company, representing about 106.92% of the issued share capital and about 51.98% of the issued share capital after the allotment.

The net proceeds from the subscription will be approximately HK $2 billion 206 million, which will be used for future potential acquisitions, repayment of any bank loans of the group and general working capital.

In 2017, Li Bao reported that the company's revenue in the first half of June 30, 2017 was HK $862 million, a decrease of 3.2% over the same period last year.

Excluding the effect of exchange rate differences, revenue increased by 0.9%.

Shareholders accounted for a loss of HK $257 million, an increase of 28.5% over the same period last year.

The company said that the decline in revenue was mainly due to intense price competition and consumer preferences towards cheap casual wear products, resulting in continued pressure on Hongkong and Macao markets, which were partly offset by the improvement of Mainland consumer sentiment.

Li said that the most important market in the mainland, the mainland's sluggish retail environment was showing signs of growth in 2017. However, the market conditions in Hongkong, Macao and Taiwan had not improved.

Retail sales in Hongkong fell to its lowest level in seventeen years in 2016, and this trend continued until the first half of 2017.

Retail sales in the mainland of China amounted to HK $367 million, a decrease of 2.8% over the same period last year. The decrease was mainly due to the depreciation of the RMB. If the effect of exchange rate differences was eliminated, retail sales increased by 3.5% over the same period last year.

In the first half of 2017, the number of shops in the mainland of China decreased by 19. The company continued to integrate its store network by closing down poorly performing shops and opening new stores in prime locations.

Another bright spot is that the China Daily reported that in the first half of 2017, the sales volume of three international men's clothing brands Cerruti1881, Gieves&Hawkes and Kent&Curwen and authorized brand D 'URBAN wholly owned by Li Bang were double digit growth.

Excluding exchange rate effects, the same store sales in mainland China increased by 8.1%.

In addition, the income of the company's e-commerce platform has doubled over the same period in 2016.

Giordano: performance "turn around" to expand the mainland's three or four line market and e-commerce business

In 2017, the performance of Giordano's public leisure wear, which has been declining for several years, has also "turned over".

In November 9, 2017, Giordano announced that the group's revenue in the third quarter of 2017 (6-9 months) amounted to HK $1 billion 240 million, an increase of 3.6% over the same period last year.

Among them, sales in mainland China amounted to HK $281 million, accounting for 22.7% of total sales, representing a 4.1% increase over the same period last year.

Group comparable store sales and comparable store gross profit increased by 2.3% and 1.5% in the quarter, respectively.

As of September 30, 2017, the company operates 2370 stores in more than 30 countries, most of which are located in Greater China, South Korea, Southeast Asia and the Middle East.

Giordano's three quarter performance continued the first half of the group's performance.

According to Giordano's 2017 China Daily, as of the 6 months ended June 30, 2017, the group realized HK $2 billion 618 million in revenue, up 3.4% from the same period last year. The company's shareholders should account for an increase of 20.1% to HK $245 million over the same period last year.

Giordano said sales growth was mainly due to better pricing and commodity mix.

With regard to the mainland market, Giordano pointed out that the electricity business in mainland China has maintained a growth momentum. The total sales volume of each electronic business platform has increased by 26.6%, representing a 12.7% increase in mainland China's brand sales from 16.2% in the same period in 2016 to 16.2%.

The number of stores has expanded, from 896 in June 30, 2016 to 913 in the same period in 2017, all of which are franchised stores.

The group said that it has been trying to improve the net interest rate of franchisees, and in the merger and offline logistics centers to enhance inventory efficiency, management will continue to invest in e-commerce business.

In the interim performance conference, Group executives said that the future will speed up the opening of stores in the mainland of China, and promote franchisees to open stores in the three or four tier cities, but if there is still room for profit in the second tier cities, they will not be closed.

Hongkong apparel retailers are also experiencing "pformation and upgrading", and the mainland market is an important driving force.

Taking a look at the clothing companies of the Hong Kong stock market, as we said at the beginning, the quantity is far more than that of A shares, but there are several types of subdivision: first, the mainland apparel retail enterprises are listed in Hong Kong, the typical ones are Anta sports, Lining and other sports apparel stocks; the other is the foundry enterprises, typically Shenzhou International, Yuyuan group, Jingyuan international, and some "shell stocks", but the main business or part of the business is also related to clothing. There are also some big international clothing enterprises listed in Hong Kong, such as Prada, UNIQLO parent companies, and the delisting of the company.

In addition to these, there is another big category that is the protagonist of this article: Hongkong's local clothing retail brand enterprise.

The first intuition of many Hongkong dress retailers is the "old brand", that is, the brand has a long history. Of course, this is relative to the mainland market and the mainland brands. Of course, many brands have a glorious history. They have a high-speed growth stage in Hongkong's local market, or have a "reduced dimension" attack power in the beginning of the modernization of the mainland's retail market. (a popular passage is Huang Bo's line, "Baleno,"), or has made a name in the international market, or some brands themselves are foreigners, and Hongkong people have taken it to "carry forward".

In recent years, as the wheel of history rolls forward, with the rapid development of the mainland market and the relative insipid retail market environment in Hongkong, some Hongkong apparel retailers seem to be a bit slow.

However, whether it is Hongkong enterprises or mainland enterprises, if we want to continue to develop, the key word is "change", that is, the so-called "pformation and upgrading", and adjust the direction of development according to the new market demand.

For Hongkong's apparel retail enterprises, a major demand power is the mainland market, how to better meet the needs of the mainland consumers, and how to adjust the pformation to the mainland consumer market.

For example, I.T, Baozi, Daphne, Li bang, Giordano and so on, which are listed above, have bright spots in their overall business or part of their business in recent two years. They are often related to the mainland market, or more integrated into the mainland market, or adjust to the needs of the mainland market to find new impetus.

In fact, behind these enterprises there are a series of similar retail enterprises in Hongkong, such as Chao brand collection shop, in addition to I.T and bohaus international, high-end women's clothing enterprises, besides Baozi and Mu Shi international, women's shoes enterprises besides Daphne and Lies Dan, high-end men's wear business enterprises besides Li Bang, YGM trade and public leisure clothing enterprises besides Giordano and burllung, JEANSWEST and so on.

A lot of Hongkong apparel retail enterprises actually have a very loud brand, and have considerable advantages and experience in international operation and layout, corporate governance structure, retail operation, talent quality and reserves. If we can better integrate with the new demand power in the mainland market, we will be able to shine new business and vigor, and leap to a new level in scale and market value, and grow into an international clothing brand magnate, so as to enjoy a new round of "spring blossoms" good times.

More interesting reports, please pay attention to the world clothing shoes and hats net.