7000 Stores Open 17 Billion Market Capitalization Even 4 Years Daphne Will Be Delisted.

Daphne may not have thought that it will usher in a chance of survival on the seventh day of the seventh lunar month.

In August 7th, Daphne rose 52.5% at the end of Tanabata Festival, sparking market concerns. Data show that, on the same day, Ma Yun shares 40% of Yunfeng to buy 3 million 350 thousand shares, the Oriental wealth of the East Fortune international to buy 6 million 830 thousand shares. Some people have interpreted this as Daphne or will take advantage of Ma Yun salted fish to turn over.

In fact, for Daphne, which has lost 4 consecutive years, close to 4000 stores, and its market value plummeted by 98%, there is still a barrier to salting fish to turn over, and the risk of delisting is still not eliminated. Looking back at the development course of Daphne, the history of its rise and fall is also very sad.

After unemployment, he was forced to start his own business and become a public shoe king, with 7000 stores.

"Beautiful 100 points, beautiful without discount." This slogan of Daphne has become an unforgettable memory for many people. "Daphne", the brand named "goddess of beauty" in Greek mythology, has been second to none among Chinese shoe companies.

In the early 80s of last century, the financial crisis caused by the oil crisis swept through Taiwan. Chen Xianmin, one of the founders of Daphne, lost his job under the influence of the storm. In desperation, Chen Xianmin and his uncle Zhang Wenyi raised 20 million NT dollars and jointly founded the "Qiao Zhi Limited by Share Ltd", renting a factory to enter the footwear industry.

At that time, the footwear industry in Taiwan experienced 30 years of development, and the industrial chain was relatively mature, and the labor force was cheap. In addition, Chen Xianmin's father-in-law's mother family is still a shoemaking family. Qiao Zhi enterprises catch up with the express train, starting from the nurse's shoes, and gradually grow and expand by the foundry.

But by the end of the 80s, with the rise of labor costs, the footwear industry in Taiwan had lost its grip on the mainland, and Qiao Zhi enterprises were in danger of shutting down production. In 1987, Chen Xianmin and his elder brother Zhang Wenyi decided to go to the mainland to develop, so the two came to Hongkong immediately to establish the wing en group, which is the predecessor of Daphne. Then he went to Putian, Fujian to set up shoe factories and became one of the first Taiwanese businessmen to rush to the mainland.

Chen Xianmin gradually realized that relying on foundry was not enough to make the enterprise bigger and stronger. So he joined Zhang Wenyi and his wife Chen Mingyuan to decide to build their own brand together. So in 1990, Daphne was born.

At that time, there were very few advertisements about shoes on TV. When Daphne entered the mainland market for the first year, it produced 10 million yuan as advertising budget. The slogan "beautiful 100 points, beautiful without discount" is publicizing this classic slogan of Daphne. Thanks to excellent design, low price, perfect after-sale service policy and overwhelming advertising, Daphne's popularity has expanded rapidly. In 1995, wing en group was successfully listed in Hongkong.

Chen Xianmin identified the business model for Daphne. In 1996, Daphne changed wholesale to direct or agent, spreading the sales point throughout the country. At that time, online shopping was not yet popular, and people's consumption habits were still online. Daphne used the combination of Street store and shopping mall counters to expand. Instead of competing with BELLE's competitors, there was only a shopping mall counter, which was crowded in the women's shoes area of the shopping mall, which played a great role in promoting the brand awareness of consumers.

But the rapid expansion has brought Daphne up. In 1999, Daphne's performance fell sharply. As a result of long-term discounts, coupled with the problem of old fashioned shoes and grinding shoes, Daphne has become a low-end and discount brand in the minds of consumers, followed by a $15 million funding gap and corporate executives' job hopping.

At that time, Chen Xianmin's nephew was also the son of another Daphne founder Chen Mingyuan. Chen Yingjie was appointed as Daphne's general manager at the time. Chen Yingjie was still playing music as the keynote player of the "Red Snake" Orchestra, Richie Ren as the lead singer. Chen Yingjie, who was in danger, had been working at the grass-roots level of Daphne for several years, so he knew the problems of Daphne. Chen Yingjie and Chen Xianmin joined hands to play the strategy of "making brands, not making famous brands", positioning their brands as middle class women's shoes, and closing the stores, promoting sales and inventory, and so on. In 2000, Daphne turned a profit.

Daphne's target audience is very clear, divided into two series: "D28" and "D18", targeting women aged 20-45 and 15-30. The "D28" series is endorsed by Rene Liu, and the "D18" series is endorsed by SHE. Thus, Daphne quickly attracted a large number of women and became household names.

In 2004, Daphne claimed that one of the five pairs of women's shoes in the Chinese market came from Daphne. In every walk street in major cities of China, Daphne can be seen almost everywhere. In 2012, Daphne had nearly 7000 stores with a market value of over 17 billion yuan, and was known as "the king of Volkswagen shoes".

Losses for 4 consecutive years, market value fell to 98%

In 2011, Chen Xianmin retired from the position of the head office. Chen Yingjie took over the handover rod of the enterprise and became the second head of Daphne. But Daphne's high gloss moment seems to be coming to an end with the retirement of the first generation of founders.

Daphne has been proud of the huge store system, instead of its burden. Beginning in 2012, Daphne began to feel the pressure due to the rise in store rents and sales costs. At that time, sales cost almost accounted for half of the sales revenue, plus too much inventory, long turnover days, and funds were heavily occupied. In 2015, Daphne suffered its first loss in nearly 10 years, and net profit fell more than 300% over the same period.

In order to cope with the declining sales, Chen Yingjie decided to reduce the number of stores. In 2015, Daphne closed 805 sales outlets, closing more than 2 stores a day on average. Data show that over the past 4 years, Daphne has more than 4000 stores closed.

Beginning in 2011, the electricity supplier entered the peak period of development, and people's consumption habits gradually shifted to online. For Daphne, the advantages of huge sales outlets began to disappear, leaving only a high rent.

Daphne realized this. In fact, as early as 2006, Daphne began to set foot in the electricity supplier, and settled in Tmall in 2009. At the same time, it began to build a self operated e-commerce company "love to carry". However, this business plan to save Daphne is stranded by Daphne's investment of 100.

In 2010, Daphne invested 30 million yuan to build a new online shopping platform with Baidu 100. However, in 2012, 100 of the high hopes were lost, and the attempt of Daphne's independent B2C failed. This failure made Daphne lag behind in the electricity supplier's track.

In 2016, Chen Yingjie also made a decision that surprised Chen Xianmin.

In the case of corporate losses and poor performance, Chen Yingjie invested in a draft show called "bee girl team", and founded a girl fashion magazine "vivi Meimei" with Japanese publishers, but with little reward. The draft show also cost Daphne 26 million yuan.

Chen Xianmin believes that this is because Chen Yingjie loved to play the band when he was young, and still can not afford his entertainment dream until now.

In 2017, Chen Yingjie handed the baton of the enterprise to the hands of his cousin Zhang Zhikai and Zhang Zhiqiao. The two were the son of Zhang Wen Yi, one of the three founders of Daphne. Since then, the two decided to target the brand target consumer group after 90, change the brand logo, locate the light luxury, close the loss and poor image of the store, layout the shopping center.

However, the effectiveness of the reform is not obvious. For now, Daphne is still under great pressure to make a comeback. According to Daphne's 2018 annual report, Daphne achieved a turnover of HK $4 billion 127 million in 2018, down 20.8% from the same period last year, while operating losses increased by HK $97 million 800 thousand to HK $787 million. By 2018, Daphne has been losing money for 4 consecutive years and is facing the risk of delisting.

In 2012, at the peak of Daphne international stock price, its share price exceeded HK $11 and its market value exceeded HK $17 billion. At the close of August 9, 2019, Daphne International reported HK $0.275 per share, HK $454 million, and its market value had dropped to nearly 98%.

"If I could come back again, I would probably do ten more years to retire." Chen Xianmin, the first head of Daphne, told the media in 2018.