The Magic Brand Of The South Pole: The Factory Has Stopped Production For A Year, Earning 1 Billion 300 Million Per Year.

The world is big, nothing strange.

In the impression of many people, there should be only one brand electric power flagship store. But when you search for the "Antarctic" in Taobao, the flagship stores such as food, men's wear, women's wear, home textiles, household goods, tights and so on almost fail.

Besides flagship stores, the official shops, business shops, franchised stores, direct selling stores, self run shops and factory shops of the southern people are also dazzling.

What is the true nature of the total number of 100 forest shops in southern Lin?

The answer may be unbelievable: they are both true and false.

The South Pole: the Chinese brand that only sells the tag.

2008 is a turning point for the South Pole. Before that, the South Pole became a famous brand in China with good product quality and crazy TV advertisements. In the field of thermal clothing, its sales and market share has always been in the forefront.

But from 2008 onwards, the Antarctic began to transform: directly cut down factories and dealers, only to "brand authorization" business. The inspiration of the south pole is from another warm clothing giant, Heng Yuan Xiang.

As early as 1991, Heng Yuan Xiang began to explore the "consortium mode", that is, to cooperate with factories, and the other side used Heng Yuan Xiang's brand label, and the profit was divided into half of Heng Yuan and Xiang Yuan. By 2007, Heng Yuan Xiang had developed nearly 100 franchised factories, with a turnover of 300 million yuan, of which 266 million yuan came from the royalty.

As a time-honored brand with a history of nearly 100 years, Heng Yuan Xiang's brand licensing business is restrained. In principle, one category of products has only one authorized factory. The ten year old South Pole did not have too much scruple, and quickly authorized the business of brand licensing.

By 2018, the authorized range of the south pole has expanded from underwear to men and women's clothing, home textiles, maternal and infant supplies, household appliances and so on. The authorized manufacturers of the upper reaches 866, the downstream authorized dealers are 4186, and authorized shops are up to 5535.

At that time, the Antarctic people had cut down all the production lines, sold all the factories, and the offline retail channels were also abandoned, and embarked on the brand authorized business mode.

That is to say, no matter where you go now, you can not buy the authentic products of the Antarctic, because the Antarctic people have not produced products for a long time. However, because of the official brand authorization of the southern people, we can not say that the products produced by the cooperative factories are fake.

Over the past year, the scope of the authorization of the Antarctic has been further expanded. According to its 2019 earnings data, the number of its latest cooperative suppliers is 1113, with 4513 distributors and 5800 authorized stores, with an increase of 28.5%, 7.8% and 4.9% respectively.

At the same time, the revenue of the Antarctic is also increasing year by year: in 2018, the revenue of the South Pole was 3 billion 350 million, of which the brand authorized revenue was 930 million, accounting for 27.8%. In 2019, the revenue of the South Pole was 3 billion 910 million, of which 1 billion 300 million of brand authorized revenue was 33.2%, accounting for 33.2%.

Is brand licensing a good business?

From the current earnings data of the Antarctic, the gross margin of brand authorization is as high as 93%, which is obviously a good business without losing money.

For authorized parties, brand licensing is also a good way to increase profits.

Zhang Jiachao runs a clothing family business in Guangdong. After five years of operation, their own brand of e-commerce has hit the top fifteen of the same class.

Even so, he chose to join the Antarctic.

The reason is very simple. The jeans they produce are priced at two yuan and 79 yuan in their Tmall flagship store, but after hanging on the South Pole's tag, they can sell two yuan and 129 yuan in the Southern stores. 8 yuan mark off fee, more than 42 yuan profit, why not? The home textile industry has a higher profit.

A set of four sets on the bed, enter the price 98 yuan, the general store retail price is 156 yuan. But with the trademark of the south pole, it can rise to 238 yuan.

Moreover, the licensing threshold of the Antarctic is not high. Take Tmall as an example, Heng Yuan Xiang's cooperative factory needs to pay 1 million yuan deposit, and the Antarctic people only need to pay 100 thousand yuan.

However, the low entry threshold has also brought problems to the Antarctic people.

According to the statistics of the southern weekend, in 2018, a total of 14 blacklisted products of the South China's silk quilts, underwear, children's clothing, hair curlers, massage sticks and other products were listed on the national quality supervision department and the local consumers' Association, which is equivalent to once a month.

It is not hard to imagine that the focus on brand licensing has long been out of production of the southern people, once encountered brand trust crisis, will usher in what kind of consequences.

It is worth noting that from the annual earnings data, we saw the second transformation of the South Pole. In 2016, revenue was 520 million, brand authorization related income was 460 million, accounting for 88.5%, and in 2017, revenue was 990 million, brand authorization related income was 630 million, accounting for 63.6%; in 2018, revenue was 3 billion 350 million, brand authorization related income 930 million, accounting for a sharp decline of 27.8%; 2019, revenue 3 billion 910 million, brand licensing related income 1 billion 300 million, accounting for gradually rising to 1 billion 300 million.

Brand authorization is the main business of the south pole, but its revenue share has dropped sharply. Behind this is the time spent by the South Pole in 2017. This is a mobile Internet media delivery platform and marketing service providers.

After joining the Antarctic, it mainly through the Tencent application treasure, today's headlines, millet and other platforms procurement flow, and then for the more than 10000 authorized South Korean businessmen to provide "efficient, quality, precision" Internet marketing services.

Obviously, the brand licensing of the southern people is a multi-dimensional business. Besides collecting trademark fees, it also makes money by providing internet marketing services to the authorized enterprises.

It is worth noting that the procurement cost of Internet traffic is not low. In 2019, time networking brought 2 billion 500 million business revenue to the Antarctic, accounting for more than 65%, but on the other side, it also accounted for more than 95% of the operating cost of the South Pole - nearly 2 billion 300 million.

That is to say, the incomes of the Antarctic people seem to be skyrocketing, but part of 2/3 does not bring more net profits.

Traffic is a double-edged sword. In the short term, Internet marketing can bring more traffic to the Antarctic people and more trading volume.

But if the south pole does not have strict quality control measures, the quality of its products will be repeated again and again. In the era of more transparent competition and more quality, the brand of the South Pole will probably only go deeper into the abyss.