After The Acquisition Of BELLE By High Allocations, The First Big Capital Move Surfaced.

"Middle-aged people are speculating on stocks and young people are frying shoes." Limited sales, re engraving classics, joint names, brand owners do not bother to think of new "routines", they can easily empty their wallets' fans' purses, and because of hunger marketing and star effect, the price increases after the sale of limited sports shoes become a common phenomenon.

The limited number of shoes can attract people's attention. Fried shoes are also very topic oriented, but this is just a reflection of the market prosperity of sports shoes or sports shoes and clothing.

Limited price shoes are expensive, but brands do not make profits in this way. Back to the fried shoes themselves, no SFC, no transparent information, high shoe prices supported by the star heat and sales volume, the ups and downs are elusive, and the high priced shoes are not cost-effective from the input output ratio. Therefore, the limited number of shoes will not produce a large volume market, even if it can, it will inevitably be accompanied by a large bubble.

The real shoe economy is not based on the toys of these few people, but at the lower prices. For brands, big cargo is their main business and core revenue point. The same is true for trading platforms. Taking poison APP as an example, most of the hot shoe sales are shipped millions of dollars, and the transaction fees of these shoes are the main revenue contribution of APP. Even for fried shoes, most shoe dealers also make big difference. The cost of building is low, and the yield is not worse than that of high priced shoes.

Some time ago, Tao Po international submitted the IPO application document at HKEx. According to the document, Tao Bo is China's largest sports shoe clothing retailer. According to the amount of retail sales, in 2018, the share of Tao Po in China's sports footwear retail market was 15.9%.

Tao Bo is the largest shoe retailer in China, a wholly owned subsidiary of BELLE international. To avoid short-term interference and pressure in the stock market, BELLE became a controlling shareholder after 2017, and the market was closed from the Hong Kong stock exchange. Now that the sports industry is improving as a whole, Gao Ling has made this sport block separate from BELLE and returned to the capital market.

Nike, ADI China's largest distributor

To sum up the business in a word, the dealer of sports brand will make profits by distributing products of the brand. Therefore, the competitive advantages of Tao Bo are embodied in two aspects, one is the sales channel, the other is the cooperative relationship with the brand. Two Both of them have high barriers to entry, such as Tai Po and its competitors, such as Sheng Dao, which have very large distribution networks.

As of February 28, 2019, the network has 8343 direct outlets and 1880 downstream retailers, covering 30 provinces and 268 cities in China. It is the most popular sports shoes and clothing product retail network in China, and its average sales volume in 2018 has reached 3 million 700 thousand yuan.

98.8% of the direct store stores are single brand stores which sell only one brand of sports shoes and clothing products. This is also a domestic feature. In China, a single brand store is the main retail mode of sports shoes and clothing products, while in Europe and America, multi brand stores are the majority. In China, it is still in the market of nurturing and opening up, and single brand stores can better display the brand image.

In addition to its brand stores, Tao Bo has its own multi brand stores, including TOPSPORTS Sports City, TOPSPORTS multi store, TOPSNEAKER trend store and FOSS (acquired in 2018). Most of the stores in the multi brand store are self operated, partly operated by independent third parties.

Data show that in the fiscal year 2017~2019, the total business revenue of Tao Bo was 21 billion 690 million yuan, 26 billion 549 million yuan and 32 billion 564 million yuan respectively. In the 2018-2019 fiscal year, the company's revenue increased by 22.7%; the gross profit margins in three years were 43.2%, 41.6% and 41.8%, respectively.

Of the 8343 direct store stores, 6383 of them are from two brands: Nike and Adidas. These two brands contribute significantly to the sales of Tao Bo, and account for 90%, 89.4% and 87.4% of their sales revenue in the 2017 to 2017 fiscal year respectively. Currently, Nike is the second largest retailer in the world and the largest retail partner and customer in the world. Adidas has maintained stable cooperation over the past decade.

In addition to Nike ADI, Puma, CONVERSE, Wei Fu Group's brand (fan, north, Tian Bailan), Reebok, Arthur, ghost tomb tiger, Cage basically covered the mainstream international sports shoes and clothing brand. The close cooperation between the huge store network and the head brand constitutes the competitive advantage of the company.

In addition, the high allocations digital transformation plan also began to land in the store. He estimates that its direct stores attract two million customers every day, which means that it can continuously and directly interact with consumers, accumulate consumer awareness and transaction data, and then serve upstream brands. In May 2018, he launched the revised "Topfans" membership scheme to provide members with discounts, additional services and sports and social activities. At present, its membership of 18 million 200 thousand members contributes 71.9% of its total intra store transactions.

From the acquisition of FOSS and the adjustment of the membership system, Gao Ling began to split up the market last year and build a sports shoe and clothing retail platform on the young track of sports and fashion.

Who is promoting the domestic sports consumption market?

The background of Tao Bo's listing is the prosperity of the sports consumption market in China.

In 2018, China became the world's second largest sports footwear retail market after the United States, and also one of the world's fastest growing major markets. From 2014 to 2018, the total retail sales of sports shoes and clothing increased from 145 billion 500 million yuan in 2014 to 235 billion 700 million yuan in 2018, and the per capita annual consumption expenditure increased from 106.3 yuan in 2014 to 168.7 yuan in 2018.

In 2018, in terms of the percentage of sports shoes and clothing consumption per capita annual consumption of shoes and clothing, the United Kingdom was 27.7%, the United States was 31.8%, Japan was 24.3%, Korea was 25.7%, Germany was 27.2%, and China was 12.5%, so China's sports shoes and clothing retail market still has great growth potential.

Around 2015, the trend of sports market was gradually shifting from functional to fashion. Nike and Adi participated in promoting this trend and entered a larger lifestyle product market from the sporting goods market. Sports fashion, or sports and leisure, is essentially the rapid digestion of sports products.

Domestic Lining is also in the direction of transformation to recover, although the domestic Anta and Lining performance has improved year by year, but the share of international sports brand in China's sports shoes and clothing retail market has increased from 46% in 2014 to 54% in 2018, and the whole market is still "Nike, ADI, eating meat, other brands soup" situation.

Today, the two level market of all sports shoes is mostly products of Nike and Adi, and the two brands have absolute right to speak. It can be said that the toe coil has become the first stop for Nike and Adi products. The new products will carry out aesthetic verification and public opinion dissemination from here, thus stimulating the sales of large goods matching colors and secondary shoes.

In addition to the development of sports market and the guidance of sports brand to the trend of popularity, domestic policies are also accelerating the consumption market of domestic sports shoes and clothing.

In October 2014, the State Council's opinions on accelerating the development of sports industry and promoting sports consumption plan to establish a comprehensive sports industry by 2025, provide a perfect sports mechanism, and allocate sports resources rationally. By 2025, the market size of China's sports industry is expected to reach 5 trillion yuan.

In July 2016, the sports industry development plan for 13th Five-Year of the State Sports General Administration plans to increase the market scale of sports industry to 3 trillion yuan by 2020, and the total number of employees is over 6 million. In addition, by 2020, the per capita sports venues area is expected to exceed 1.8 square meters. China's per capita sports consumption accounts for more than 2.5% of per capita disposable income.

In October 2016, the guidance of the general office of the State Council on accelerating the development of fitness and leisure industry indicated that China's fitness and leisure industry is also an important sub industry of sports industry. By 2025, its market size is expected to exceed 3 trillion yuan.

In the coming years, major sporting events will be held in Beijing in 2022, including the 2022 Olympic Winter Games, the 2022 Asian Games and the Asian Football Association Asian Cup. There will be no doubt that these sports events will promote the development of sports consumption in China, such as the 2008 Olympic Games.