Hai Lan Home Light Assets Mode Inventory Close To 9 Billion

600398.SH, which continues to expand in the diversified road, may be suffering from the embarrassment brought by high inventory prices.

According to the performance bulletin recently released by Hai Lan home, the company achieved total revenue of 18 billion 200 million yuan in 2017, an increase of 7.06% over the same period last year, and a net profit of 3 billion 329 million yuan, an increase of 6.6% over the same period last year.

"China Business Daily" reporters pay attention to the past financial reports found that although Hai Lan's business income and net profit showed varying degrees of growth, but the growth rate has slowed down.

And the main brand Hai Lan's performance is not as good as before. By the end of 2017, the business sector had earned 14 billion 758 million yuan, an increase over the same period.

The problems of Hai Lan's light assets mode, high inventory pressure and lack of innovative original design are constantly exposed.

Reporter's job performance and other related issues sent an interview letter to Hai Lan's home. The company's secretaries did not respond positively to the interview question, but told reporters, "although the annual report has not yet been officially disclosed, we have recently disclosed several responses to the SFC, which are described in more detail."

The problems of Hai Lan's light assets mode, high inventory pressure and lack of innovative original design are constantly exposed.

Our reporter Wu Rong / Photography

High stock and worry

Data from the third quarter of 2017 showed that the inventory at the end of the reporting period was close to 8 billion 996 million yuan, an increase compared with the beginning of the year.

In the past few years, the home of Hai Lan, known as the "man's Wardrobe", has expanded rapidly.

From 2014 to 2016, the number of stores in Hai Lan's home was 3348, 3990 and 5243 respectively.

As of September 2017, the number of stores in Hai Lan's home has reached 5608.

However, the pace of shop opening has not slowed down, but the home of Hai Lan has been slowing down.

Data from the latest performance bulletin show that the company's operating income and net profit growth in 2017 were 7.06% and 6.6% respectively, and 2016 revenue and net profit increased by 7.39% and 5.74% respectively, and these two

In 2015, they were 28.3% and 24.35% respectively.

At the same time, the main brand Hai Lan home's revenue growth has been declining year by year. In 2017, the business revenue was 14 billion 758 million yuan, and the annual revenue ratio was 81.09%.

According to the financial report, the annual operating income of the main brand was 10 billion 125 million yuan, 12 billion 874 million yuan and 14 billion 31 million yuan respectively during the period ~2016 2014, representing an increase of 49.58%, 27.16% and 8.98% over the same period last year, showing a declining trend year by year.

This figure is still declining in 2017, representing an increase of only 5.18% over the same period last year.

In fact, with the backlog of store expansion, it is becoming one of the main problems that haunt Hai Lan's home development.

According to the financial data from Hai Lan's home, its inventory was 9 billion 580 million yuan in 2015, an increase of nearly 3 billion 500 million yuan compared to 6 billion 86 million yuan in 2014.

In 2016, its inventory dropped to 8 billion 632 million yuan, but the number of days of storage and freight turnover was 316 days, an increase of 18 days from the previous year.

In the first half of 2017, the inventory of Hai Lan's home has exceeded the sum of the previous year, reaching 8 billion 675 million yuan.

Data from the third quarter of 2017 showed that the inventory at the end of the reporting period was close to 8 billion 996 million yuan, an increase compared with the beginning of the year.

For the problem of inventory, Hai Lan's home replied to the SFC, "Hai Lan's home mainly purchases products through purchasing contracts with suppliers, which can return the goods with unsalable goods. The products are sold by the stores (excluding Direct stores) on the basis of consignment sales. All the products listed or stored in the stores are stock of Hai Lan's home, resulting in a larger inventory carrying amount of the company.

The company has made provision for depreciation in accordance with the regulations, and the risk of loss in the inventory is small.

At the same time, Hai Lan House believes that "there are a large number of stores. In order to ensure timely distribution of stores, the company usually stores the purchased clothing in the warehouse at headquarters in Jiangyin in advance of the 1~2 quarter, and stores and replenishment from the headquarters warehouse to all stores according to the needs of the store operation, resulting in a larger amount of inventory goods."

Observers, Cheng Weixiong, general manager of Shanghai Liang Qi Brand Management Co., Ltd., told reporters that in fact, high inventory is a common problem in the clothing industry. Since 2010, due to the sluggish demand, the performance of the clothing industry has been depressed, and the backlog of inventory has always been one of the pain points of clothing enterprises.

Statistics from Wind show that as of the first half of 2016, 40 listed clothing companies in A share issued semi annual reports, and the total inventory at the end of the report was 34 billion 850 million yuan, which was more than seven times net profit.

A senior executive of a garment company who did not want to be named had admitted: "

It takes at least 3 years for companies to digest these inventories, but they still need profit support behind their inventory. Once the financial statements are not very good, banks will follow the lead.

However, in recent years, with the end of the inventory adjustment approaching, the situation has improved.

The same data from Wind showed that the total inventory balance of clothing enterprises at the end of 2016 and the end of 9 in 2017 decreased slightly, while there was a larger division in individual aspects. The turnover of enterprises in Semir and costumes was better than that in the industry. However, inventories increased due to factors such as the new merger scope and the development of multiple brands.

According to the question of "how large the stock is reasonable," Cheng Weixiong said, "according to the practice of traditional clothing enterprises, the normal stock sales rate of general brands is between 35%~45%. These stocks basically have three parts: first, brand manufacturers, stock 15%~20% (in accordance with the implementation of 15% return rate, plus stock), two is regional general agent, inventory 5%~10%; three is franchisee, inventory accounts for about 10%~15%.

However, with such inventory standards, there are not many enterprises that can guarantee average level.

However, we generally believe that such a business like Hai Lan's business model is a joint venture brand, and more inventory is borne by the supplier. Therefore, individuals believe that the inventory rate of Hai Lan's home should be controlled at around 25%, and if the pressure is above 25%, the pressure is a little big.

However, the reporter did not find out the relevant stock rate statement.

Light asset model controversial

With the expansion of Hailing's home and the expansion of its scale to thousands of stores, it is difficult for suppliers to get tens of millions or even hundreds of millions of yuan to get the goods. If the suppliers are willing to take inventory, they will probably be dragging their suppliers to death.

For the huge inventory, garment industry observer Ma Gang believes that this not only affects the health of the supply chain, thereby reducing the overall profits of the company, but also affects the freshness of the store clothing.

Shutting down poorly managed stores, discount sales promotion has become a traditional practice for most garment enterprises to inventory.

Reporters learned that Baleno will hold a sale every year to sell inventory, Lining some products in outlets outlets discount rate is also less than half off.

"Hai Lan's home does not discount at the end of the season and the end of the season. It violates the life cycle of the product. The inventory products are put on sale at the sub brand Hai family, and a store in the sea is usually opened with the main brand, Hai Lan's home."

Ma Gang said.

Cheng Weixiong believes that the discount can eliminate part of the inventory, but affected by the light asset mode, the stock crisis is still relatively large.

The so-called "light asset mode" means that Hai Lan's home serves as a brand, providing brand and management. Franchisees do not need to pay the franchise fee. They only need to provide rent, shop decoration fees (including hardware and software decoration) and related operating expenses, and do not have to participate in the specific operation of franchised stores. All the stores' internal management is entrusted by the home of Hai Lan, and suppliers are responsible for providing goods.

Ma Gang told reporters to control the upstream product planning and brand management, while the downstream "supply chain management and marketing network management", and the middle part of the "product design, clothing production, pportation and distribution" link was outsourced, Hai Lan's home was equivalent to a manufacturer looking for OEM production and opening up upstream and downstream roles.

Specifically, in the initial stage, suppliers may be aggressive in this mode, because the cost of investment is low, but with the expansion of Hailing's home and the expansion of the scale to thousands of stores, it is difficult for suppliers to supply tens of millions or even hundreds of millions of yuan. If suppliers are willing to take inventory, they will probably give suppliers the risk of dragging them to death.

This means that Hai Lan's home must buy its own goods, so the procurement cost is increasing and the stock will be further increased.

Cheng Weixiong said.