After The Outbreak Of 5G, How To Adjust Children'S Clothing Industry?

Up to now, three children's clothing listed companies, including Semir, Ann and blonde Rabbi, have released the 2019 performance bulletin, all of which appear to be declining in revenue or net profit. The adjustment period of children's clothing industry has arrived?

　　 Poor performance

Recently, Semir's 2019 performance bulletin showed that the company's operating income during the reporting period was 19 billion 359 million yuan, an increase of 23.15% over the same period, and net profit of 1 billion 546 million yuan, down 8.72% from the same period last year. Semir's children's wear brand balbala has the highest market share in China, ranking 5.6%, according to data from European information consulting.

In recent years, Semir has relied on children's clothing business to achieve steady growth in revenue, but the Chinese Commercial Daily reporter noted that Semir's performance growth has slowed down. Reporters inquired about the company's financial data, found that in 2018 a quarterly, China, three quarterly and annual reports showed that Mori Makiyo's profit growth rate remained at around 25%. But after entering 2019, this index dropped from 11.06% of a quarterly report to 2.79% of the three quarterly report. At the same time, since the second half of 2018, the net operating cash flow has continued to decline. The 2019 China Daily showed that Semir's operating cash flow was -4.18 billion yuan, down 4923.40% from a year ago, and the pressure of cash flow is increasing. In addition, the company's accounts receivable and inventory rose sharply. As of June last year, the company's accounts receivable amounted to 1 billion 547 million yuan, an increase of 73.97% over the same period last year, and its inventory was 4 billion 200 million yuan, an increase of 58.97% over the same period last year. In the industry view, net cash flow declined, accounts receivable and inventory rose, to a certain extent, that Semir did not achieve real cash flow back, business risk increased.

The performance of the company, known as "the first share of children's wear", is even less optimistic. The 2019 earnings bulletin showed that the company's revenue was 1 billion 327 million yuan, an increase of 9.43% over the same period last year, but its net profit dropped by 49.08% over the same period last year, to 42 million 460 thousand and 500 yuan. It is noteworthy that during the reporting period, he received a government subsidy of 21 million 8 thousand and 500 yuan, which is expected to affect 15 million 756 thousand and 400 yuan in net profit. That is to say, excluding government subsidies, the net profit of the company is only 26 million 704 thousand and 100 yuan a year. At the same time, the company's high inventory has also been criticized outside. From 2017 to the third quarter of last year, the book value of the company rose from 297 million yuan to 509 million yuan, the proportion of the total assets of the company rose from 27.34% to 42.94%, and the inventory risk continued to deteriorate.

(shooting: Zhongfu net)

In addition to the above two children's wear listed companies, blonde Rabbi is also having a bad time. The 2019 performance bulletin showed that the company achieved a revenue of 438 million yuan, a decrease of 3.39% over the same period last year, and a net profit of 47 million 111 thousand and 100 yuan, an increase of 19.23% over the same period last year. In this regard, blonde Rabbi said that during the reporting period, the company adjusted its sales channels and sales policies, resulting in a decline in revenue; strengthened the control over the cost and expenses of the products and the smaller net profit base in 2018, resulting in a rise in net profit. It is noteworthy that the sales cost of blonde Rabbi has been increasing. Southwest Securities Research Report shows that the rapid growth of the golden hair Rabbi will drag down the performance.

In addition, the initial shares of self proclaimed "children's shoes" seem to be in the development dilemma. Although the 2019 performance bulletin has not yet been released, the performance of its initial shares in recent years is hardly optimistic. According to the company, from 2015 to 2018, the market share of the company's brand ABC KIDS children's shoes decreased from 4.01% to 3.6%, and its share in children's wear market was only 0.5%. At the same time, the company appeared to increase profits without increasing profits. In 2018, its revenue grew by 4.43% compared to the same period last year, while net profit fell by 7.05%. In the first half of last year, the company's revenue grew by 17%, while its net profit fell 2.42%. In addition, the China Commercial Daily reporter noted that the asset liability ratio of the initial shares increased continuously, from 2017 to September last year, the data rose from 19.14% to 34.76%. This means that the company's solvency is weakened and its financing difficulties are increasing.

Industry adjustment period has arrived?

From the above four children's clothing listed companies' performance, they all face different business risks. So, is the adjustment period of children's wear industry coming?

Ma Gang, a clothing industry expert, told the China Daily News reporter that after the rapid development of children's clothing market in recent years, the major brands gradually entered the stage of slower growth. With 80 and 90's mothers becoming the main force of consumption, the consumption trend of children's clothing becomes more complicated, which puts forward new requirements for brand products and marketing channels. If the brand can not keep pace with the market changes, it will be marginalized or even eliminated at this stage.

Cheng Weixiong, general manager of textile and clothing management and Shanghai Liang Qi Brand Management Co., Ltd., also told the China Daily News that although the scale of children's wear market is still expanding, the speed of expansion has slowed down. Cheng Weixiong believes that the low-end children's wear market has gradually saturated, and the convertible profits of brands have been decreasing.

　　 March toward high-end

In an interview with the China Commercial Daily, Li Yahui, a retail consultant of garment industry, said that in fact, whether it is the whole garment industry or the field of children's clothing industry, it is facing the problem of brand development. Only by truly grasping the change of consumers' needs will there be the possibility of future development.

In Li Yahui's view, there is still room for development in the children's wear market, and international brands and domestic brands are snatching this cake. But from the perspective of the development of children's clothing brand in our country, it seems that more attention is paid to the layout of sales channels, and there is a phenomenon of blind expansion. Li Yahui admitted that the biggest development pain for all children's clothing brands is that the brand can not adapt to the changes in consumption trends, and it is difficult to accurately grasp the needs of consumers. In addition, children's clothing market products homogenization is serious, each brand style is similar, it is difficult to gather stable consumer groups.

Facing the ever-changing market environment, how can children's clothing brand be in an invincible position in the competition? Li Yahui told reporters that children's clothing brands need to work hard from product design, materials, quality and scene experience to enhance the shopping experience of consumers and meet the individual needs of consumers. At the same time, children's clothing enterprises should enhance their brand influence through Internet marketing and experience marketing.

Cheng Weixiong said that with the improvement of consumption concept and quality of life, the high-end market will become a battleground for all children's wear brands. Consumer demand will drive the development of children's wear industry to brand, personalization and functionalization.