Hong Kong'S Clothing Brand Dilemma Increased, And The Net Loss Increased 118% In The Second Half Of Last Year.

Fierce competition in the market, coupled with the winter clothing industry, the Hong Kong clothing brand is losing its earlier light and declining.

Hongkong's clothing brand Bossini bursholon released its interim results in February 20th. In the June ended December 31, 2018, the group's revenue was HK $875 million, down 10.13% compared with the same period last year. Gross profit was HK $457 million, down 10.71% from the same period last year, gross margin was 52%, net profit deficit was HK $25 million 748 thousand, an increase of 118% over the same period last year. The basic loss per share is 1.57 Hong Kong cents, and an interim dividend of HK $1.22 per share is to be issued.

For the decline in performance, burshlung said that because of the group's core markets, the winter climate was exceptionally warm, and local consumption was low. The group's overall revenue fell 10%, same store sales fell 5%, gross margin fell 1 percentage points to 52%.

In recent years, the performance of burglung has declined, and profits have been declining for four consecutive years. According to statistics, net profit from 2014 to 2017 recorded HK $127 million, HK $115 million, HK $25 million and HK $4 million 886 thousand respectively.

In fact, it is not only the case of burshilong, but in the state of capital being cold, other traditional clothing brands in Hongkong are all miserable, and sales and performance are declining. Sales of I.T stores in Hongkong continued to decline, Giordano stores significantly reduced, and sub licensed EULA ceased to operate; JEANSWEST's sales declined in 2017 and lay off substantially, showing signs of collective decline of Hong Kong's casual wear brands.

After the attractiveness of Hongkong's fashion market gradually declined, Hongkong's retail industry increased further. According to statistics, Hongkong's retail sales reached HK $44 billion 914 million in December 2018, a mere 0.1% growth, the lowest growth rate in 18 months. Earlier aware of the downturn in many Hongkong markets, brands such as burshlong, Giordano, I.T and so on have been fighting in the mainland market, but it seems that they have not received very good results.

In the middle of 2018, the sales volume of China's mainland market reached HK $167 million, down 2% from the same period last year, accounting for 19% of total sales, while same store sales fell by 3%. In 2011, Giordano began to show a downward trend in sales in the mainland of China, and the number of stores in the mainland also gradually reduced. Once the "clothing giant" JEANSWEST closed 1300 stores in five years, and staged layoffs to reduce the cost of drama.

As one of the three giants of clothing in Hongkong, burshilong began to look for new ways to improve its profitability and expand its business after slow development. In February 2017, burshlung purchased the financial products provided by Credit Suisse Bank Hongkong branch to increase revenue through the layout of financial products. In addition, burshlung has also stepped up its product line to enhance its brand image and store service and expand its share of consumption in the market.

For the future, apart from the young market, burshlung will further expand the children's clothing market, so as to expand the company's customer base. The market is changing rapidly, and supply chain management is strengthened to improve operational efficiency.

These brands, once occupying a place in Hongkong and even the clothing industry, are now experiencing constant decline in performance and closing stores. Not only are they affected by the depression and fierce competition of the garment industry, but also from the brand itself. Some people in the industry have analyzed that the decline of brand is the lack of innovation of garment enterprises for their own products, and has not kept pace with the trend of fashion market.

Especially today, foreign fast fashion brands are flooded with domestic clothing consumer market. Zara, UNIQLO, H&M and other brands are pouring into the market and constantly cutting the market share. Moreover, the rise of the new generation of consumers has a new demand for fashion consumption and is increasingly fastidious about brands. The traditional clothing brands in Hongkong do not know how to innovate and can only be abandoned by these consumers.

In 2019, burshalon said in its earnings report that it will further expand and optimize wholesale channels in the future, improve operational efficiency and strictly control costs, and will further expand children's clothing market to expand customer base, will launch more functional new product design, and focus on young consumers to gain more market share.