Seven Wolves Fall To The Summit, Can The Road Of Self Rescue Return To Its Peak?

The former king was reduced to bronze and was abandoned by men.

The times always belong to the prescient, an era has the trend of the times, and an era has the imprint of an era.

Speaking of the men's clothing market, it seems to have become the world of Hai Lan's home. However, before the home of Hai Lan, the men's clothing world can be described as seven wolves (002029, stock bar). When it prevails, Armani and Gucci are still studying how to enter the Chinese market.

However, with the changing trend of the times, the seven male Wolves of the men's clothing seem to have been gradually abandoned by men. The impact of the Internet's dimension reduction and the fast fashion brand has been a major setback. Traditional brands have suffered major setbacks.

In late August, the seven wolves announced the half year report in 2019, which achieved a business income of 1 billion 555 million yuan, an increase of 6.55% over the same period last year, and realized a net profit of 123 million yuan attributable to shareholders of listed companies, down 8.42% compared with the same period last year. The net profit of non profit deduction was 68 million 139 thousand and 800 yuan, down 15.33% from the same period last year.

Seven wolf said that the main reason for the decline in net profit was the increase in advertising fees, platform service fees and terminal management fees compared with the same period in 2018.

Build the first brand of men's clothing, the king of jacket goes to the top.

Jinjiang is located at the core of Golden Triangle in Southern Fujian, separated from Taiwan. This is a poor county town under the jurisdiction of Quanzhou, but after the reform and opening up, it became the leader of China's garment industry through the spring breeze of "three to one complement". The first foundries of Nike were located here.

At that time, the Jinjiang enterprises belonged to the barbarous growth stage of extensive development. Because the supplies were scarce at that time, they belonged to the seller's market at that time. As long as the products produced by the enterprises were not sold at all, the ambitious Chou brothers were not only satisfied with the quick money to earn OEM, but they wanted to make a brand themselves, and they could be famous all over the country and even become famous overseas brands.

In February 1985, the founder Zhou Shaoxiong and Zhou Shaoming brothers invested and founded the Jinjiang Jin Jing labor overseas Chinese hometown garment craft factory, this is the predecessor of the seven wolf group. In the late 80s of last century, Chyi Chin, a singer in Taiwan, sang "I am a wolf from the north". In 1990, Zhou Shaoxiong took advantage of this upsurge to launch the brand of "seven wolves" and hired Chyi Chin, who was just right then, to become a brand spokesperson. Carrying the appeal of Chyi Chin, the performance of the seven wolves is high, thus opening the road of "male god harvesting". The big tough movie stars were invited to be their spokesmen. Honglei Sun, Chang Chen, Hu Jun and Zhang Hanyu were the four "movie kings" in one breath.

Jacket is a popular single product in the 90s of last century. It is also the pivot of seven wolves to move men's clothing market. In 1991, the seven wolves launched the color change jacket, and the fire spread all over the north and south of the river. In 1995, the double-sided jacket was launched, and the classic slogan of "man is more than one side and character is consistent", so that the brand of the seven wolves is in the ascendant.

"At that time, the seven wolves brand took men's life as the starting point, and interpreted the responsibilities and difficulties of men in different roles in their work life, which resonated with many consumers at that time, and gave more encouragement to male consumers with the connotation and spirit of wolves." Fei Hongping, an associate professor at East China University of Science and Technology business school, evaluated the advertisement of seven wolves.

In 2004, the seven wolves successfully landed at the Shenzhen Stock Exchange and became the first listed men's clothing company in China. After 8 years, their performance has been climbing steadily. In 2012, seven wolves reached their peak, with a revenue of 3 billion 480 million yuan and a net profit of 550 million yuan, which was 13 or 18 times higher than those just listed 8 years ago.

Garment performance has come to a great blow since 2013.

Before 2013, seven wolves followed the wind, and their performance increased year by year. However, since 2013, the situation has plunged rapidly. The net profit of the company has fallen for 4 years, and the National Men's wear is facing the biggest challenge since the listing. In 2013, revenue and net profit fell by 20.23% and 32.44% respectively. In the dominance of men's clothing, the crazy shop expansion became a drag on the seven wolves. The number of stores decreased from 4007 in 2012 to 2821 in 2014.

Inventory has become an important factor restricting the development of the seven wolves.

In the first half of 2019, the assets of the seven wolves were reduced by 64 million 653 thousand and 800 yuan, accounting for 42.14% of the total profit, mainly due to the inventory price drop.

The inventory problem has plagued seven wolves for many years. In 2013, the stock of goods reached 7 million 461 thousand and 100, an increase of 15.24% over the same period last year, and the total value of the stock rose from 566 million yuan in 2012 to nearly 1 billion yuan in 2018. In the first half of 2019, it was reduced compared with 2018.

Light R & D, heavy sales, core competitiveness declined

Design is one of the core competitiveness of the clothing industry, but since 2014, the development and investment of the seven wolves has been decreasing year by year, such as the R & D investment of 52 million 780 thousand yuan in 2018, accounting for 1.5% of the total revenue, down 26.74% from the same period last year. The development cost of the seven wolves in the first half of 2019 was only 21 million 350 thousand yuan, down 29.98% compared to the same period last year.

On the other hand, the sales cost of the seven wolves is also increasing. The sales cost in 2012-2017 years is hovering around 450 million yuan, while in 2018 it increased to 595 million yuan, accounting for 16.9% of the total revenue. In the first half of 2019, the sales cost of the seven wolves reached 339 million yuan, up 33.36% over the same period last year.

Many aspects of competitors' attack, the traditional clothing brand entered the cold winter.

With foreign fast fashion brands such as Zara, H&M, UNIQLO and so on, China has entered the market rapidly with iterative products and innovative management. UNIQLO and ZARA have been able to beat the market in the domestic market in recent years, and have made the domestic clothing brand fall into a drain, relying on the advanced SPA mode.

This model was first extracted from the clothing brand GAP in the fast moving industry. Enterprises can participate in the industrial design, production, logistics, sales and other industrial links all the time, so that they can respond quickly and accurately.

Take ZARA as an example, all the clothes in its headquarters warehouse will not be stored for more than three days. The store will send 2 orders to the headquarters every week to replenish the products, and its products will only take two weeks from design to store sales, while the traditional garment enterprises will have at least 4-6 months in this cycle.

It can be seen that the domestic traditional clothing brand and the overseas fast fashion brand's play is not at the same level, like "three dimensional body" in "reduces dimension attack", has been beaten naturally.

In addition, the rise of the Internet business has also caused a huge impact on the physical store, and profits are also declining. According to the financial report, in 2013 -2016, the net profit of seven wolves belonging to the parent company was 379 million yuan, 288 million yuan, 273 million yuan and 267 million yuan respectively.

Diversified self rescue, transformation pains or hard to return to the peak of the past

Over the past ten years, China's men's clothing enterprises have basically adopted the mode of "wholesale + brand". Apparently, the seven wolves also saw the drawbacks of the wholesale mode. In 2013, within the seven wolves, the transformation of the channel has begun, from the "wholesale + brand" mode to the retail mode. However, this channel change seems to have failed to reverse the effect. The number of terminals of the seven wolves has decreased from 4007 in 2012 to 2821 in 2014. In 2016, the profits of the seven wolves were 134 million yuan, which was about 20000000 yuan less than that of 2008.

Secondly, the vertical diversification of the seven wolf business was expanded from selling jackets to selling socks and selling underwear. In 2014, the seven wolves recalled the original external authorized trademark of knitting textiles, and began to make men's underwear, underwear, socks and knitted products. And selling socks did bring more benefits to the seven wolves. The results showed that men's underwear, underwear, socks and other products contributed more than 1 billion 100 million yuan revenue to the seven wolves, accounting for 36.34%. The once hot jacket is less than 10% a year. But the gross profit margin of underwear, underwear and socks is lower than the gross profit margin of other products.

Another way is to expand horizontally, and open the operation mode of "industry + investment", one of which is real estate management. According to the financial reports, in the 2014-2016 years and 1-9 months of 2017, the proportion of the real estate sector's income in the main business of the seven wolf group was 13.77%, 10.34%, 42.48% and 58.29% respectively. In addition, the seven wolves also entered the venture capital industry. They also made the best of their efforts. According to public data, seven wolves set up 6 investment companies, such as Xiamen seven wolves equity investment company.

However, diversification has failed to revive seven wolves. In the past few years, the wolf wolf's men's wear has been steadily declining. In the past 5 years, China's men's wear market has undergone profound changes, but the seven wolves have gradually become a marginal role from a protagonist.

But there is a time of high gloss for the seven wolves, a famous Chinese men's clothing brand with a history of 29 years. But in the current economic transformation tide, just like all the problems faced by the clothing enterprises, transformation is very difficult. Nowadays, the powerful family like Hai Lan has also experienced growth bottlenecks, and its growth rate is slow. After the downward trend of clothing market, the business rule of survival of the fittest will dominate the fate of enterprises. Can the seven wolves who re established their main business return to the peak of the year?