"China Zara" Thunderstorm, La Natsu Bell Is Not Saved?

La Natsu Bell, known as the "Chinese version of Zara," ushered in the "darkest hour" in 2019.

Recently, La Natsu Bell disclosed that the proportion of La Natsu Bell's controlling shareholder Xing Xing Xing stock pledge is close to 100%, which constitutes a breach of contract.

Behind the actual control of the pledged warehouse is La Natsu Bell's share price is only 1/6, 2400 stores in the first half of the year, is expected to lose 540 million of the fact.

La Natsu Bell lost in a series of crises. Its recent disclosure of the semi annual loss warning has even cast a shadow over its way ahead.

Burst warehouse

Recently, two announcements by La Natsu Bell brought it to the top of the storm.

The first announcement shows that La Natsu Bell's real control of Xing Jiaxing's pledge to Haitong Securities has been lower than the minimum performance guarantee, because no early repurchase and no performance guarantee measures have constituted a breach of contract, which may affect the stability of the control rights of listed companies.

Up to now, xingjiaxing accumulative total pledge of 141 million 600 thousand shares accounted for 25.85% of the total share capital of the company, accounting for 99.81% of its own holdings.

The second announcement shows that La Natsu Bell, the unanimous action of the actual controller of the Shanghai, has made a supplementary pledge to CITIC Securities by holding the 6 million shares of the company's shares.

Prior to this, Shanghai and summer have already pledged 22 million shares to CITIC Securities, and then have 5 million plus and 5 million 500 thousand shares of supplementary pledge.

The successive pledge of equity supplement is inseparable from the stock price that La Natsu Bell is now stumbling down. Since La Natsu Bell went public, the stock price has been around 30 yuan, and now its share price has dropped to around 5 yuan.

La Natsu Bell's early warning of losses in 2019 seemed to be unable to see the end.

In the first half of 2019, its operating income dropped by more than 20% over the same period last year. The net profit attributable to shareholders of listed companies was 440 million yuan to 540 million yuan, down by 286.6% to 329% compared with the first half of 2018.

La Natsu Bell said in the announcement that this is mainly affected by the continued downturn in the domestic retail market and its own initiative to optimize the channel structure under the line. Due to the accelerated sale of goods over the past season, the gross profit margin declined. In addition, the continuous repayment of bank loans during the reporting period had a negative effect on the purchase of goods in 2019, and the purchase of new products.

Its series of transformation and adjustment, measures to reduce costs and increase efficiency have not shown significant results, or have yet to offset the downward impact of sales.

A precursor

La Natsu Bell's decline has long been a precursor.

In 2018, La Natsu Bell's revenue was 10 billion 159 million yuan, an increase of 13.08% over the same period last year. However, according to the newly released aggregate method, the operating income was 2.58% lower than the same period last year, a loss of 160 million yuan, a decrease of 132% compared with the same period last year, a loss of 245 million yuan after deducting non profits, and a decrease of 164.43% compared with the same period last year.

As for the reasons for the decline in performance, La Natsu Bell reflected on his "multi brand and full direct" mode, facing the challenge of the downward market environment, and urgently needed to adjust.

Since 2012, La Natsu Bell has always adhered to the business mode of "multi brand and direct business oriented", which includes five women's clothing La Chapelle, Puella, 7 Modifier, La Babit and 23 / 63 Candie's, three Mens JACK WALK, Pote, MARC WALK and children's wear brand, and the number of stores reached 9059 by the end of 2018.

In the early stage of brand development, Direct stores can establish brand image, enhance market awareness and facilitate unified management. And on the basis of women's wear, the "multi brand" strategy of men's wear and children's wear brands can achieve full coverage of the consumer's clothing requirements.

In fact, "horse racing enclosure" is La Natsu Bell's early development strategy. Before 2011, La Natsu Bell had only 3 women's wear brands and 1841 stores, and the number of outlets reached 8902 in 2016.

Such a large retail network is directly operated. Once the market is down and sales are cold, the excessive cost of direct mode will seriously drag on revenue.

Compared with other peers, La Natsu Bell's sales rate reached 52.9%, significantly higher than the industry average of 34.8%. This is closely related to La Natsu Bell's approach to the all direct operation mode. Other companies in the industry usually use the combination of direct and franchise.

At the same time, La Natsu Bell's "buy, buy, buy" rhythm did not stop.

In May this year, La Natsu Bell announced the completion of the French apparel brand Naf Naf 60% remaining shares trading, the transaction amount of 270 million yuan. Last June, La Natsu Bell gained 40% stake in 160 million yuan.

After 2015, La Natsu Bell basically stopped the cultivation of new varieties, mainly by investing in cooperation to expand the brand, such as Siastella, OTR, GARTINE and other brands. However, for the development of new brands, the first 3-5 years are brand cultivation period, which is not only easy to cause business losses, but also needs to invest more business resources.

Initial heart

The fate of La Natsu Bell's founder Xing Jiaxing and clothing began at the age of 21. At that time, he held hundreds of dollars from his mother, started from the training course of clothing, worked as a garment factory worker, and distributed clothing, and finally founded the clothing brand "La Natsu Bell" in 1998.

There is also a poetic inspiration for the brand name of "La summer bell". La Natsu Bell's French name is "La Chapelle", the residence of Xing Jiaxing when he conceived the brand, the name of a french street. Xing Jiaxing hopes to integrate French fashion culture into costume design, bringing romantic French design to Chinese consumers.

La Natsu Bell's initial position was the 25-30 year old lady's style. Influenced by Zara and other fast fashion models, La Natsu Bell speeded up the laying of Direct stores in the channels, and in the style and design, he also paid close attention to the latest developments in the French fashion industry. Xing Jiaxing once said, "if there are fashion shows in Paris, the relevant information will appear in our mailbox within second days".

However, it is regrettable that ten years later, it is difficult for La Natsu Bell to catch up with fashion again.

A loyal consumer who was La Natsu Bell before said that it was once in the wardrobe, and now there was nothing, even even the urge to go in. "Clothes are too ugly and too popular. They are all goods in stock."

In addition, there are many Tucao about La Natsu Bell's clothing quality, for example, "once you wear it once, you have pilling." Some people even warned La Natsu Bell not to buy clothes without discount.

In recent years, the "multi brand" strategy has also failed. La Natsu Bell's many women's clothing brands do not seem to have much difference in style. If we can not achieve differentiated positioning, we can not focus on target consumers, resulting in a large number of multi brand stores accumulated a lot of inventory.

In addition to the main business women's wear brand, La Natsu Bell also launched a brand name for men's wear and children's clothing. However, due to the late start of men's clothing business and lack of brand influence, the gross margin of men's clothing business is generally around 50%-60% compared to the gross margin of women's clothing business around 60%-70%. While the gross margin of children's clothing business is generally around 55%-65%, La Natsu Bell's rapid expansion of new brands and even more reckless discounts led to a gross decline in gross margin.

And all of this is in the main brand growth stagnation, and even sales downward trend. La Chapelle, which accounts for the largest share of company revenue, has seen a sharp decline from the two quarter of 2018. Puella brand income declined continuously in 2017 and 2018.

Whether it is to deal with unsalable stocks or to promote the expansion of new brands, price promotions have become a way that La Natsu Bell can not get around. Continuous discounts and increased sales of quarterly products also drag on gross margins. In 2018, the average gross profit margin of La Natsu Bell fell from 67.73% to 65.33%.

2018 in the second half of this year, La Natsu Bell changed the whole direct battalion mode and launched the franchise and joint venture mode, hoping to achieve 50% in the next two years. In addition, last year, La Natsu Bell also recovered online sales channels, directly managed online business, and coordinated the development of brand online and offline integration.

In the downturn of the clothing market environment, La Natsu Bell had to stop running in a hurry to stop the bleeding, reduce the cost and increase efficiency.

However, after experiencing capital expansion such as listing, financing, horse racing, and brand acquisitions, La Natsu Bell seems to have forgotten the original intention of being born on that romantic French Street and bringing the best products to Chinese consumers.