Workplace Regret: If Daphne Didn'T Give Up Adidas, What Would Happen Now?

Daphne group's latest report shows that in fiscal year 2018, the turnover of the company was HK $4 billion 120 million, down 20.8% from the same period last year.

Operating losses have increased gradually, from HK $688 million in fiscal 2017 to HK $787 million.

The number of core brand shoe cabinet and Daphne store has been reduced to 2648, of which 2404 are direct stores and 244 are franchisees.

Old women's shoes in 1987

Daphne was born in 1987, the company initially commissioned for the footwear industry in the United States, and began to run its own brand store in 2000, with its famous brands such as Daphne and shoe cabinet.

In 2009, TPG invested 550 million yuan to become Daphne's weight shareholder.

In 2012, Daphne's revenue increased 1 times, its net profit increased 1.4 times, and its stores increased by 2600.

By 2014, Daphne's revenue was HK $10 billion 356 million.

However, since 2013, Daphne has seen a downward trend in turnover, a decrease of 0.8% over the same period last year, and a 0.9% decline in turnover in 2014. Since 2015, Daphne has declined at a rate of around 20%.

Daphne's market value dropped from 17 billion to 1 billion 700 million, shutting down thousands of stores and laying off over 10000 people.

Abandoning Nike and Adidas

According to public information, Daphne's agent Nike and Adidas's business was around 2002. At that time, BELLE group, the two major sports brands also made Daphne taste the sweetness. After rapid growth, the stock crisis came into effect in 2008, and sales growth slowed down.

At that time, Daphne's agent Nike had 28 stores, and Adidas had 128 stores.

It is understood that in the first half of 2009, Daphne began to reduce the action of the agency brand store, Adidas closed 21 in half a year, Nike reduced 20.

That is, in the second half of 2009, Daphne completely stopped acting Nike and Adidas's business.

Two way decision making of internal and external factors

There are two factors to abandon agency: one is the rapid growth of Daphne's own brand.

The proportion of private brand business has been rising. The performance of shoe cabinet and Daphne has exceeded expectations, and turnover has increased significantly.

This has been doomed Daphne will continue to increase investment in its own brand.

The second reason came from Nike and Adidas. In the market environment at that time, the international sports brand channels were mainly concentrated in the main cities. Daphne thought the market was too saturated.

The sinking was very difficult at that time, because Nike and ADI in China were originally agents, and Daphne, BELLE and others all had their own brands, and their performance was higher than that of the agency.

The key is that the 234 line agents will choose higher profit Lining, Anta and other national cards, which is said to be at least 5 points higher than the profit margin.

In this way, Daphne believes that the future can not be expected, and Nike and Adidas are separated.

BELLE's sport is another way.

In contrast, BELLE's performance bulletin in the first half of 2009 showed that BELLE's Nike and Adidas revenue was 3 billion 320 million yuan, up only 2.5% from 2008, and its own brand was also good. However, BELLE did not choose to break up with Nike and Adi, but mainly shut down second tier brand stores.

In the first half of 2009, BELLE closed 346 sportswear shops, of which 304 were second-line brand shops.

After 2 years of development, by the first half of 2011, there were 349 new stores in BELLE, most of which were shops of Nike and Adidas. BELLE became one of the largest distributors of Nike and Adidas in China this year.

Although the current BELLE delisting, footwear is also shrinking dramatically, but according to BELLE international 2016 fiscal year performance Bulletin shows that its sports and clothing business has maintained growth momentum, revenue increased by 17.2% to 16 billion 971 million yuan.

Now BELLE group has begun to plan to split the sportswear business into the public market. It is said that the Bank of America and Merrill Lynch has been hired to make preparations for the listing in Hongkong this year. The company aims to raise the value of its agent sales department, including Nike and Adidas, to 20 billion to HK $25 billion.

Today, Daphne is trying to reverse its declining trend in terms of brand marketing, such as cross-border cooperation with the US trend brand "OpeningCeremony".

Daphne also launched a series of integrated marketing activities for its products, including invited stars, social media marketing and online live events.

In fact, there are many factors that cause Daphne's present situation. For example, Daphne shoes, which are criticized by consumers, especially comfort, there are sports market impact, channels, electricity providers and so on, but ultimately they should be placed on core products.

It can be said that if Daphne did not give up Nike and Adidas's proxy right now, it would be a little different now.

But then again, there is always a trend in the trend. It is not a bad thing to concentrate on good women's shoes. I am not sure which day the old Daphne will return to the public eye.