It Has Been Said That YOUNGOR's Return To The Main Garment Industry Is Difficult For The Real Estate To Give Up.

YOUNGOR, which has always been called the main garment industry, still finds it hard to give up its real estate business.

In August 1st, YOUNGOR issued a notice on the acquisition of land use rights by wholly owned subsidiaries. The company's wholly owned subsidiary, Ningbo City, Hal Business Service Co., Ltd., in the selling activities of Zhejiang province's land use right online trading system, competed with the price of 3 billion 997 million yuan to win the right to use state-owned construction land in the five Jiangkou block of Haishu district.

The notice shows that the land use is urban residential land (ordinary commercial housing) / town housing, business finance, retail business, catering, hotels, entertainment land, covering an area of 191179 square meters.

YOUNGOR, a garment enterprise established in 1979, has developed from a township garment enterprise to the first men's clothing brand in China, and has been gradually operating in a diversified and professional pattern. It has established three major industries, namely, brand clothing, real estate development and financial investment. However, with the change of market situation, YOUNGOR's investment business has gradually got bogged down in the mire and began to have the determination to return to its main business.

　　 Difficult to give up real estate

In April 30th, YOUNGOR announced the strategic adjustment announcement that it will further focus on the development of the main garment industry. Besides strategic investment and continued investment commitments, it will no longer carry out the financial equity investment in the non principal sectors.

Once the "three carriages" became today's clothing as the main body, real estate has become the only sideline, and the investment business has been gradually stripped.

In 2016, YOUNGOR claimed to focus on the clothing business, and put forward the strategy of "reconstructing a YOUNGOR in five years". But in the past three years, only YOUNGOR has seen the real estate business.

In 2017, YOUNGOR took three plots in Ningbo and Zhoushan at the cost of nearly 4 billion yuan. In July 2017, YOUNGOR invested 2 billion yuan to set up Shanghai YOUNGOR Real Estate Development Co., Ltd. in 2018, YOUNGOR had successfully won 1 billion price in Tianjin, and in 2018 February 2019, YOUNGOR spent 3,9 billion to buy three plots in Cixi; in March 2019, YOUNGOR won two plots in Qilihe area of Lanzhou province at 450 million yuan price; in May 2019, the company established the "Kang Kang travel Holdings Limited" as a new foreign investment company, operating industrial investment, real estate development, self owned housing leasing, and real estate information consulting service.

In the first eight months of this year, YOUNGOR has four real estate related projects, while the number of projects for the clothing industry is few. On the other hand, YOUNGOR said that it would return to the main business and continue to pay for the real estate business.

At the shareholders' meeting in May 20th, Li Cheng Cheng said, "what is the main business is not the main business, making money is my main business." Called "invisible developers", YOUNGOR is worthy of the name.

But after many aspects of layout, YOUNGOR's real estate business has seen a downward trend in its revenue. 2018 annual report shows that real estate revenue decreased by 17.8% to 3 billion 990 million yuan, net profit decreased 14.5% to 1 billion 50 million yuan.

　　 The clothing industry's exploration has not been effective.

Li Rucheng once said in an interview with the media that the golden age of the real estate market has passed, and that the risk of financial investment is large. Therefore, it is a rational choice to return to the main business, and YOUNGOR is a relatively solid enterprise in the clothing industry.

Seen from the development strategy, YOUNGOR's return to the main garment industry is focused on the exploration of new retail and linking consumers with new ways.

In 2018, YOUNGOR launched an intelligent factory to build a smart sales platform to get through the channels under the lines. In early 2019, YOUNGOR joined the A100 strategic plan of Ali, and started full cooperation from business, technology and intelligence; in May 2019, YOUNGOR signed a strategic cooperation agreement with Shanshan to optimize the retail channel, explore new retail scenes and enhance the value of the brand.

In addition, at the beginning of 2016, when YOUNGOR proposed to return to its main business, it took trouble to dig up Giorgio Armani designer and Taiwanese Gong Naijie as the design director of the company. She also flew to Europe to visit the top fabric suppliers.

In June of this year, YOUNGOR launched the Disney Lion King series T-shirt, completing its first IP joint name, making the design style more youthful, and further attracting 85 consumers to relearn YOUNGOR.

It is worth noting that YOUNGOR is trying to attract young consumers, but has completely shut down its young fashion men's brand GY store. According to statistics, in 2018, GY closed 95 stores, leaving only one self operated network. For closing GY, Li Rucheng has said that the gross profit margin of GY is only about 40%, and the market competition is very intense. If it continues to run, it will lose money, so the brand will be removed in time.

After continuous innovation and upgrading, YOUNGOR's clothing business does not seem to have improved much. According to the earnings data, YOUNGOR's brand clothing business cost increased by 1.31% in 2018 compared with the previous year, and the operating cost of the brand suit increased by 10.46% over the same period last year.

YOUNGOR's main brand YOUNGOR has a serious problem of brand aging, and consumers are solidified. The original customers are also shunted out by international brands, so the brand will inevitably fall into a dilemma of development.

As a clothing enterprise with 40 years of qualification, YOUNGOR has its own advantages in its own craft and clothing quality. But how to use this advantage to tell a vivid and vivid story to attract consumers is a problem YOUNGOR needs to consider.