Cost Saving Hongkong I.T Launched The "Unpaid Leave Plan".

In February 22nd, according to Hongkong media reports, Shen Jiawei, founder of Hongkong tidal group I.T, recently announced layoffs in the company, and launched the "unpaid leave plan" simultaneously, in order to save the company costs.

It is reported that I.T announces to employees by e-mail that it will implement "unpaid leave" for all employees between February and March. According to the internal letter, all C level administrative staff will be given 12 days unpaid leave, vice president level and director level are 10 days, other employees earn 20 thousand or more for 7 days, and 20 thousand days less than 4 days.

Up to now, I.T has not responded to relevant news.

Public reports show that since August 2019, the I.T group has laid off more than 300 people. At the same time, according to the latest earnings report issued by I.T in January 20th, the sales of I.T in Hongkong and Macao decreased by 33.3% compared to the 3 months ended November 30, 2019, while the same store sales in mainland China decreased by 5.2% compared with the same period last year, while the same store sales in Japan and the United States decreased by 6.1% over the same period last year. According to the announcement, the gross profit margin of the group dropped to 62.3%, the gross profit margin in Hong Kong and Macao was reduced to 58.6%, the gross profit margin in mainland China increased to 61.5%, and the gross profit margin in Japan and the United States was 69.5%.

I.T explained that the Hongkong and Macao businesses were affected by the recent decrease in the number of inbound passengers, so the same store sales growth of the division declined. The gross profit margin of the Division also declined compared with the same period last year, mainly due to the extra discount activities.

Declining performance, layoffs and streamlining expenses are facing challenges like I.T and Hongkong's retail industry as a whole. But unlike other businesses that are more restricted to retail chains in Hongkong, I.T has long gone deep into the mainland. In 2002, I.T opened the first flagship store in Shanghai Xintiandi except Hongkong. Up to now, there are more than 500 direct retail outlets in the country's more than 30 second tier cities.

On line, in 2017, I.T reinstalled the official electronic business platform ITeSHOP, and then officially entered WeChat to launch a small program. At the marketing level, I.T, an "attempt" on the mainland market, also announced in 2017 that Wu Yifan, the top runner, became the first spokesperson.

Even so, the downward trend of I.T is still evident, and earnings performance is unstable. The reporter noted that in the past two years, I.T has had inflection points in 2018 and in the first half of 2019.

"The price is not dominant, the fashion shop is incomplete, the shopping experience is poor", this is the reporter's "Tucao" noticed by the reporters in the relevant message area. In addition to the problems of I.T itself, the rise of competitors has also led to I.T's internal and external difficulties. For example, HYPEBEAST, the international media and e-commerce sales platform that also plays a leading role in youth culture, reached HK $3 billion in 2019, exceeding HK $2 billion 700 million of I.T. The YOHO group, which started with the youth trend media, has already started the media + business mode, and has begun to infiltrate the line. Now, two new retail stores have been opened in Nanjing and Shanghai.

"Apart from the problems of the product itself and the strength of the competitors, the relatively immature buying system of I.T and the lack of tidal current of most shops in the mainland are also an important reason why they are not popular with young people." a clothing retailer who asked not to be named told reporters that the sense of experience and space design aesthetics should be maximized. Use, otherwise, how is it different from the general general store?

Reporters also noted that in the past two years, I.T has tried many new initiatives. For example, in Hongkong, we have built a new concept flagship store I.T blue block covering more than 16 thousand square feet, which is divided into 5 different areas: fashion dress, fashion food, home products, shoe accessories and outdoor products. In terms of products, it launched a joint brand series with William Chan, a movie star.

Fashion critics Liang Jiajun believes that I.T's core competitiveness is still its High fashion, Streetwear and tide brand portfolio and a large number of its own brands. "If they keep paying close attention to them, they will always find their place in a more competitive market.

It is not yet clear whether we can find our own position under the great opportunity of the rising tide of youth culture, but it is certain that I.T is changing. When the "unpaid leave plan" came out, it was reported that Shen Jiawei, the founder of the company, was interested in letting her daughter Shen Yue take over so as to inject more fresh blood into the company.

It is worth mentioning that in the Chinese market, which is bundled with stars and fashion, as the daughter of the famous film actress Chingmy Yau and Shen Jiawei, Shen Yue, who was selected to participate in the Paris Prom dance, can bring absolute flow to I.T regardless of whether he takes over. But traffic is both an opportunity and a test.