Chinese shoes are "polarized" into a miniature of industry reshuffle

Jinjiang, a county-level city in Fujian Province, has produced many well-known brands such as Anta, 361 degrees, Xtep, Hongxing Erke, and noble birds in the development time of the past 30 years. It has also been researched by the China Leather and Footwear Industry Research Institute. The institution is jointly named as "China Shoes Capital".

 

However, the Changjiang Business Daily reporter observed that the Jinjiang sports brand is polarized, and some brands have become the first echelon of Chinese sports brands, such as Anta; also the brand that once had a smash hit the historical stage, such as Del Hui, Xidelong Wait.

 

"The survival of the fittest is the normal state of the market, and there are industry reasons for the company to fall down, but more is still the problem of the enterprise itself." Wang Weiran believes that the current domestic sportswear industry as a whole is recovering, the industry has obvious advantages in concentration, and the future emerging sports products will be the industry. With the development of new opportunities, Jinjiang sports brands still have the opportunity to break through development.

 

Li Jun, secretary-general of the Fujian Footwear Industry Association, said in an interview with the Changjiang Business Daily on the 12th that the sports and leisure shoes produced in Fujian have occupied half of China's “sports and leisure shoes”. In 2017, the footwear industry in Fujian Province achieved double-digit growth throughout the year. With the expansion of the industry segment and the high-tech intelligent movement, the entire sporting goods industry is expected to usher in a new round of growth. For enterprises, they can no longer develop with the flow, and they must have a clear market awareness and a sense of urgency in the times to be eliminated by the market.

 

Del Hui fell on the road to the market, and the debt 6.3 billion yuan was closed.

 

The Changjiang Business Daily reporter was informed that at the end of 2017, an asset disposal published in the Fujian Daily revealed that Delhui’s debts were 636 million yuan, and its plants, land and warehouses were all mortgaged. The company has now closed down.

 

The Changjiang Business Daily reporter saw that in the Delphi Tmall flagship store, the monthly sales of its explosive shoes were only 939 pieces. In contrast, the Xtep Tmall flagship store, which is also a brand of Jinjiang, has more than 10,000 monthly sales of various sports shoes. Tmall flagship store staff told reporters that the goods sold must be genuine Del Hui manufacturers, some are Del Hui old models, the new production company is Kaitian Sporting Goods Co., Ltd.

 

According to public information, the legal representative of Delphi Co., Ltd. is still the founder of the company. The legal representative of Kaitian Sporting Goods Co., Ltd. is Tang Mingqiang, and he is also the legal representative of Shangfeng Sporting Goods Co., Ltd. and Fujian Zero Point Sporting Goods Co., Ltd. According to the information, Kaitian Sports was established in December 2016 with a registered capital of 50 million yuan and its business scope is sporting goods.

 

The industry believes that although Delphi assets face disposal, its brand still has a certain market. Kaitian Sports took over the Del Hui brand, perhaps to rekindle its fire.

 

Del Huiyin Jay Chou's phrase "does not take the usual path", from the silent name to the Jinjiang second-line brand. According to media reports, Del Hui has more than 4,000 stores nationwide, but by mid-2017, there were fewer than 1,000.

 

Wang Weiran bluntly said that in the ten years of cooperation with Jay Chou, Del Hui lacked insights into consumers and missed the opportunity for transformation. "As a sports fashion brand, a star endorsement for ten years is quite risky." Wang Weiran believes that the decade of Del Hui's rise and fall is exactly the decade in which Chinese consumers have undergone profound changes. Chinese consumers only recognize brand effects. Blind consumption, began to move toward rational consumption, "fit for yourself" is the most important consumer trend. As a company, failure to return to the product itself and insight into changes in the consumer scene is an important reason for the company's final closure.

 

According to the data, in 2007, Delhui launched the Hong Kong stock listing plan, but the financial turmoil eventually collapsed. Subsequently, Del Hui moved to A shares, but after a long wait, Del Hui submitted a suspension review application to the Securities and Futures Commission in July 2014. In the past eight years, Del Hui paid a huge price on the way to the market.

 

From blind expansion to survival of the fittest, the "Chinese shoes are" no longer

 

Del Hui is not the first production stoppage of the Jinjiang sports brand, and it is hard to say that it is the last one. Before Del Hui, the US listed company Xid Long was bankrupt, and Hopleys, a Singapore-listed company, crocodile Wright boss lost contact and was unpaid.

 

In the past 30 years, the “Jinjiang Model”, which is dominated by the footwear industry and famous at home and abroad, has been questioned.

 

According to the Jinjiang Municipal People's Government website, the total profit of Jinjiang Sports Manufacturing Co., Ltd. in 2015 decreased by 6.3% year-on-year, which was 10.2 percentage points lower than the total industrial profit of the regulation. The profit rate fell by 1.1% year-on-year, exceeding the regulation industry. According to public data, the analysis of economic operations in the first three quarters of Jinjiang City in 2016 showed that 369 industrial enterprises in the city had stopped production or reduced production, and the production reduced by 25.2%, an increase of 1.1 percentage points year-on-year. Among them, 67 enterprises were closed down, the output value decreased by 13.487 billion yuan, and the output value of the low-level regulation increased by 4.4 percentage points.

 

In May 2017, the first Chinese fast-moving consumer goods manufacturer that landed on Nasdaq, Xidelong, was declared bankrupt. After the financial fraud before the listing and the decline in the post-listing performance, Xidelong eventually withdrew from the market in 2014.

 

The capital chain is broken, the homogenization is serious, the inventory is overwhelmed, the foreign big influx, the e-commerce impact... A series of problems make Jinjiang sporting goods manufacturers run thin.

 

The Jinjiang Municipal People's Government admitted in its 2016 "Jinjiang City Sports Industry Development Research" that Jinjiang City's sports industry development is not mature enough, the technology content is not high, the innovation is not strong, and the homogenization is serious. The article points out that there are fewer flagship leading enterprises in the sports industry in Jinjiang City. Although there are more than 5,000 sports industry enterprises, they are generally small and medium-sized enterprises. The scale is small, the number of enterprises with an output value of more than 5 billion yuan is small, and the enterprises with more than 10 billion yuan are not. . The industrial structure is single and the product homogeneity is serious. It fails to form an effective differentiation, resulting in increased competition and lower profits.

 

Jinjiang City official said that the processing capacity of Jinjiang enterprises and the operation of the market form a sharp contrast. In Jinjiang, the structure of products, the construction of the market, and the operation of the brand are all in the initial stage of development. Sportswear enterprises such as Jinjiang shoes and clothing are generally adopted. The way to hire celebrity endorsements to enhance brand awareness, and this way has been followed by companies, but the brand propaganda effect has become similar, simple plagiarism has caused Jinjiang shoes and apparel industry to encounter heavy losses.

 

According to official data, since 2004, Jinjiang shoe enterprises have invested more than 6.5 billion yuan in CCTV and local TV.

 

At the same time, the market is changing. Wang Weiran pointed out that the "Jinjiang Model" is the epitome of China's sporting goods manufacturing industry. From 2005 to 2006, the amount of sportswear brand financing increased sharply, and domestic sports production enterprises showed a blind expansion of production and “enclosure” movement. After 2008, the market supply and demand imbalance, coupled with the rise of e-commerce platform, the performance of sports goods store began to decline. At that time, most of the sporting goods manufacturing enterprises in Jinjiang were still in the stage of blindly following the trend and local “mutual enthusiasm”. They did not see the changes in the market outside the market, so they missed the best opportunity for the transformation of the Internet of enterprises, and did not produce the synergy effect of regional integration development. .

 

Excellent enterprises go against the current trend and strive to find market segments

 

The survival of the fittest is a common occurrence of the military. Under the Jinjiang model, there are also many enterprises that go upstream, and in the market torrent, they have the right to speak in the industry.

 

The Anta brand, which is also the “Jinjiang Department”, has now become the first echelon of Chinese sports brands. Today, Anta's market value exceeds 74 billion yuan, with more than 9,500 stores, and Nike, Adi, Anderma are among the world's four major sporting goods companies.

 

In the view of Ding Shizhong, Chairman and CEO of ANTA Sports Board, the “transformation from brand wholesale to brand retail” proposed in the year became an important strategic choice to change Anta’s direction. Take store effect first, do not blindly open stores, in the industry low tide, the first to resume growth. In the industry downturn in 2012, Anta took the lead in turning crisis into an industry leader.

 

Nowadays, if a company relies on a single brand, it will not be able to compete with overseas brands such as Nike and Adidas. Ding Shizhong saw that only by implementing a multi-brand strategy can more possibilities be created. The 2017 mid-year report shows that FILA's revenue share has reached 20% of Anta Group, and FILA is a clothing brand acquired by Anta in HK$600 million in 2009, and has now become an important driving force for Anta's performance growth. In addition, in September 2017, Anta was hit by HK$60 million to acquire Hong Kong's mid-to-high-end brand “Xiaoxiao Niu”, targeting the 150 billion children's wear market.

 

In addition to the existing business, the sports brand noble birds have also invested in professional football equipment retailers, sports and fitness technology applications, e-sports anchors and professional team brokers, and women's sportswear brands. There are dozens of investment projects, involving an amount of nearly 5 billion yuan, seeking the development of their own brands. Senma, Qiwowo, Anta, Li Ning, etc. have opened up a new retail trillion market.

 

There is no bad environment, only companies that are not suitable. In Wang Weiran's view, doing excellence and doing fine is the foundation for a company to survive. The Jinjiang model is changing, and each company is looking for a market segment to find its own point of strength.

 

The gap with international brands is narrowing, emerging sports or development opportunities

 

As a county-level city, Jinjiang has nearly 40 listed companies and has become the county-level city with the most listed companies in China.

 

In the first half of 2017, the financial report showed that during the reporting period, in the comparison of operating income, Anta surpassed the balance between Li Ning and 361° in the second and third position of the industry. Except for Xtep’s decline in revenue and net profit, Anta and Li Ning Both 361° achieved steady growth in performance. Overall, from 2012 to now, Anta, Li Ning, and 361° gross profit margins are rising, and Anta's gross profit margin has exceeded 50%.

 

“The sports and leisure shoes produced in Fujian have occupied China’s 'half of the country'.” In the interview, Li Jun proudly stated that in 2017, the footwear industry in Fujian Province achieved double-digit growth throughout the year. Li Jun pointed out that with the expansion of industry segmentation and high-tech intelligent movement, the entire sporting goods industry is expected to usher in a new round of growth.

 

In Li Jun's view, sports goods manufacturers must change their market positioning in traditional manufacturing. With the advent of the era of intelligence and big data, the clothing and footwear industry has changed from functional to intelligent. The sports manufacturing industry already contains many technologies. content. The product should strengthen the scientific and technological content from the new perspectives of manufacturing process, product function, marketing channel and business model, and comprehensively upgrade the production and manufacture of the footwear industry.

 

Wang Weiran believes that after years of development, the domestic footwear brand is narrowing the gap between product quality and foreign brands. On the channel, domestic brands have more geographical advantages, especially in the market advantages of third- and fourth-tier cities. Wang Weiran suggested that sports goods manufacturers can continue to maintain the existing "strike" on the one hand, and at the same time strengthen product development in special sports projects, such as skiing, water sports, etc., to break through the high-end market in first-tier cities. Future emerging sports products will be new opportunities for industry development.