Younger, Seven wolves, Annunciation, etc.

In the past two years, the domestic men's clothing industry has been in a downward trend, resulting in men's clothing companies have to face the end of the bubble, had to close several stores that had opened a flag.

From the 2015 annual financial report released by domestic domestic men’s listed brands, it seems that under the generally depressed market environment in the retail industry, it seems that men’s brands have begun to emerge from the haze, and some still fall into the quagmire. Under the pressure of continued weakening of the general environment, the transformation of menswear companies is also imperative.

Many clothing listed companies have started a series of reforms in order to get rid of the sluggishness caused by their main business, and raised funds to invest in the entity industry to seek self-help. In the case of mergers and acquisitions by apparel companies, reselling shells, multiple investments, and other M&A investment events, a series of “cooperation” incidents involving garment companies are also taking place.

Faced with the overall market downturn, people in the industry believe that this year is still a year of adjustment for the menswear industry, and it is difficult to see results in various attempts in the short term. "Under the pressure of falling net profit, although we have begun to attempt to drive performance through diversified transformations, we have invested more energy, but the transition has to go through a certain period of pain, and we can't immediately see obvious results, so the transition period It is also a test for enterprises.” An industry person is worried about the prospects of these companies.

Shen Wanhongyuan's research report is optimistic that from the perspective of fundamentals and the rotation of various sectors, the sub industry adjustment order is generally sports shoes, casual wear, home textiles, men's shoes, men's wear, high-end men's and women's wear. At present, the sub-industry has moved to the menswear industry. It is expected that the men's garment industry will bottom out in 2016 and the performance will be more flexible. The success or failure of the transformation is the key to determining whether the company's performance can rebound.

Domestic men's wear performance is looting Youngor's net clearance shop 35

Recently, Youngor announced the first quarter of 2016, operating income of 5.558 billion, a year-on-year decrease of 11.41%; net profit of 2.447 billion, an increase of 76.30%. Among them, the apparel business realized operating income of 1.04 billion yuan and net profit of 208 million yuan, down 12.03% and 28.12% respectively from the same period of last year.

Other brands in the industry, such as Septwolves, Annunciation Birds, and Nine Animal Husbandry, have not achieved good results. The seven-quarter 2016 performance report of Seven Wolf showed that due to the reduction of orders, the company's net profit for the first quarter of 2016 was RMB 64 million, a year-on-year decrease of 5.18%. The net profit of the Announcement Birds decreased by more than the same period last year, reaching 86.16%. The net profit of Jiumu Wang only increased by 0.36% year-on-year. Only Dai Yang Genesis and Hinur's net profit increased. However, it is worth noting that although the net profit of Hinnor achieved a double-digit increase of 10%, the total amount is only about 5 million yuan.

From the perspective of shrinking stores in the first quarter, there are 35 Youngor clearance stores and 26 Jiumuwang clearance stores. The performance of the seven wolves has been declining since 2013 and continues to close stores each year. According to public statistics, in the first half of 2014, Seven Wolf had 3155 terminal stores; by the end of the first half of 2015, there were 2,636 terminal stores, a decrease of 519 over the previous year. The total number of stores opened by Dayang created by the end of March this year was 44 and 5 stores were closed in the first quarter, which was mainly due to the loss of shopping malls or poor management.

According to industry insiders, the domestic menswear industry has been in a downward trend in the past two years. This is because compared with the traditional retail industry, changes in the current market and changes in consumer spending behavior have caused men’s clothing companies to have to end the squeeze. . The final outcome is to close down several stores that had once opened their doors. According to the retail sales data of consumer goods recently released by the National Bureau of Statistics, in March 2016, sales of clothing, shoes, hats, and needle textiles continued to record a new low, only 4.4% year-on-year growth to 348.2 billion yuan, which was far behind the 9.8% of the year 2015. The increase was also significantly slower than the 8.4% increase in January-February.

For the slowdown and slowdown of performance growth, a number of local menswear companies also generally stated that weak market demand is a major factor affecting performance.

Domestic tide of men's clothing store upsurge? Business cost problems can not be avoided

For the decline and slowdown of performance growth, a number of local menswear companies generally stated that weak market demand is a major factor affecting performance. According to the retail sales data of consumer goods recently released by the National Bureau of Statistics, in March 2016, sales of clothing, shoes, hats, and needle textiles continued to record a new low, only 4.4% year-on-year growth to 348.2 billion yuan, which was far behind the 9.8% of the year 2015. The increase was also significantly slower than the 8.4% increase in January-February.

According to the Southern Metropolis Daily, the increase in operating costs has become an inevitable problem for garment companies. For example, elegant bird, its apparel industry, operating income increased by 3.09%, but operating costs increased by 4.2% year-on-year, gross profit margin decreased by 0.55%; footwear operating income fell by 0.5% year-on-year, operating costs increased by 7.7%, gross margin The company’s operating income dropped by 39.42%, operating costs dropped by 38.63%, and gross profit decreased by 0.86%.

Hodo's Hodo Menswear, operating income increased by 32.83%, but operating costs increased by 34.41%, gross profit margin decreased by 0.87%. Melaya's revenue from direct sales stores increased by 3.70%, but operating costs increased by 12.36%, and gross profit margin decreased by 3.91%.

The situation of clothing companies shutting down can not be ignored. In 2016, Guiren Bird opened 71 new retail terminals and closed 148 retail terminals. As of the end of the reporting period, Youngor’s sales outlets have decreased by 35 compared with the beginning of the year. Meier brand joined the joint venture to close 2 stores. Jiumu Wang opened 12 new stores, but closed 23 stores; the franchise opened 28 stores but closed 44 stores.

In light of this, Xiong Xiaokun, a light industry researcher at China Investment Advisors Co., Ltd., said that the general decline in apparel industry revenues was mainly due to the decrease in demand. In addition, under the pressure of inventory, companies have to cut prices to sell slewing funds, making the market price wars more frequent and the situation of the garment industry more severe. ”

Chen Ke pointed out that in the past, China’s garment enterprises mainly relied on the development model of “brand and dealers quickly opened stores”.

“Because of the increase in the cost of opening stores and labor, the decline of the traditional department store model, and the lack of dealers' fine operating capabilities, the traditional growth model relying on brand dividends cannot support the rapidly increasing demand in the future. On the other hand, it is accompanied by the structure of consumer groups. Change, consumer buying behavior tends to be rational, and overseas purchases, clothing sales sites, designer brand rise and other factors, so that consumers have more clothing purchase channels than in the past.”

Is it profitable to rely on clothing to make money?

Today, it's not easy to make clothes! It's even harder to make money-making clothes! Many companies have transformed: Adding some sideline jobs; Some have done bad things, Some have done bad things, and others have been unable to distinguish between vice-professionals Industry, or the main business is a sideline. Everyone has only one purpose: to survive, to develop, to realize the dream in the heart...

According to Zheng Yonggang, the founder of Shanshan, “The era of relying on clothing to make money has passed.” Recently, this listed company started with clothing and is planning to spin off its apparel business and apply for listing in Hong Kong for its apparel business. In the representation of the Shanshan shares, this does not mean "abandoning" but rather arranging a new place for the clothing business that made great contributions to Shanshan. The plan to spin off the listing together with the company's financial leasing business, if the plan is successfully completed, Shanshan's capital map is expected to extend to Hong Kong stocks, by that time, Shanshan's will control the six listed companies. Some people say that after the completion of the spin-off, the clothing business that has performed poorly for consecutive years will no longer be "dragging." Allowing the apparel business to “go away from home alone” is interpreted as a “bashing rejection” strategy.

In the overall downturn of the apparel industry, garment companies are seeking new growth points in various ways.

At the end of last year, Youngor’s wholly-owned subsidiary invested 50 million yuan in investment in new energy industries. This investment aims to grasp the investment opportunities of the major health and new energy industries. It is the beginning of the company’s exploration of new energy and is in line with the company’s long-term strategic development plan. It is conducive to the transformation of the company's investment business to strategic and industrial investment and the expansion of the investment business interface, which will help the company increase its brand value and drive the company's overall development. In the first quarter of 2016, Youngor’s net profit surged due to the real estate business. It is understood that although the real estate segment and the investment segment performed well, the apparel business is still the main business of the Youngor Group. The group also stressed that it must return to its main business. The investment can help the company get through the apparel industry chain, and the vice-industry backs up the main business.

Clothing companies "cooperation" frequently: Finding a new space for development

Behind frequent incidents of cooperation in apparel companies is the result of comprehensive promotion of China's economic structure transformation, integration and reconstruction of the garment industry, transformation and upgrading of garment companies, and clothing consumer market changes. Looking at the past two years, the incidents of strategic cooperation of garment enterprises have occurred from time to time.

Typical strategic cooperation between Youngor and CITIC, billion investment in CITIC shares. Youngor announced on June 10 last year that the company has signed a strategic cooperation agreement with China CITIC Corporation. The two parties agreed to combine their advantages to jointly seek and capture major strategic opportunities in China and the global market to collaborate and use their existing ones. Resources, channels, and strengths to cooperate to provide business partners with convenient and supportive services to enhance their corporate value. Subsequently, on July 17, Youngor issued an announcement that Xinma International, its wholly-owned subsidiary, subscribed for 859 million new shares of CITIC Corporation at a price of HK$13.95/share, with a total transaction volume of HK$11.896 billion. Youngor said that this move is intended to strengthen the strategic partnership between the two sides has been established, and through the CITIC shares platform to promote Youngor's domestic and international strategic resources and business opportunities to promote the company's transformation and strengthen its profitability and influence.

Aokang International and SKECHERS strategic cooperation, strategic investment Lanting potential. In August 2015, Aokang International announced a strategic cooperation with the second largest sports shoe brand in the United States, Skechers, and plans to open about 1,000 new Skecherie stores in mainland China within five years. The business of Aokang began to enter the sports sector. Aokang International stated that it will establish a long-term strategic partnership with SKECHER and establish an information sharing mechanism, a business cooperation mechanism, a communication and exchange mechanism, and a cooperative research mechanism to integrate the resources of both parties.

In addition, in April 2015, Luolai Home Textiles announced a strategic cooperation with Hetai in order to jointly research and produce series of smart home and family great health products for the bedroom; Mengjie Home Textiles announced that it has established strategic cooperation with Hetai and developed and Made with smart bedroom series products. The two large-scale textile enterprises have successively cooperated with the same company, and it should have valued the strength and leading position of Hetai Electronics Co., Ltd. in the home electronics and intelligent controller industry.

The purpose of cooperation is to achieve a win-win situation and to create a synergy effect, which requires both parties to come up with complementary resources for sharing. This means that, just as mergers and acquisitions need to avoid integration risks, garment companies must also choose appropriate partners to avoid opportunism, cooperate well in the process of cooperation, establish a relationship of mutual trust, and reduce competition risks in the process of cooperation. Once the power of “combining two swords” is brought into play, it will find new directions and create new space for garment enterprises in the stage of transformation and upgrading to form new competitive advantages. This is also an important way and way for garment enterprises to transform.