YOUNGOR Chairman Li Rucheng: The Next Step Is To Increase International Mergers And Acquisitions.

Affected by the appreciation of the renminbi and the rising cost of raw materials and labor, the textile and garment industry is facing an "export cold spell". Textile and garment enterprises have integrated domestic sales channels to increase their firepower to fight the domestic market.

However, in the winter of this textile and garment industry, YOUNGOR (600177.SH), both in terms of enterprise scale and industry chain, made a "counterflow" action: in January 10th, YOUNGOR acquired the new MMA group, the core menswear Business Department of KELLWOOD company.

In addition, the development of YOUNGOR's equity investment and real estate industry has led the outside world to speculate about its main business development direction.

At the end of June, the reporter interviewed Li Rucheng, President of YOUNGOR.

Twenty-first Century: now the whole garment and textile industry is facing the "cold current of exports". What measures will YOUNGOR group take in the next few years?

Li Rucheng: for clothing enterprises, brand building and channels are the key to sustainable development. We will make greater efforts to promote domestic sales.

First of all, the company is gradually increasing the proportion of medium and high grade products.

In 2007, YOUNGOR sold 5 million 300 thousand shirts, even though it was close to 2006, but sales revenue increased by 37%.

The main reason is that we have improved the quality and quality of shirts.

Our high-end shirts exceed 50% of the proportion, and the high proportion of high-grade products can also increase the gross profit margin. In the future, we will continue to increase the proportion of medium and high grade products.

Twenty-first Century: what is the current situation of YOUNGOR in the international market?

Li Rucheng: long ago, we adhered to the goal of "50: 50", that is, the share of the domestic market and the foreign market accounted for 50%.

But now the international market is sluggish, especially in the US market. Many enterprises have low prices, and the cost of Southeast Asia is cheaper than ours. They have to pfer (production base) to China's manufacturing industry.

Low quality and low price products must be eliminated, so we are now developing towards high-end market.

In the next second steps, we will surely acquire and merge some good and large brands to have pricing power.

We have recently talked about a brand in the United States so that we can quickly enter the mainstream market of the United States.

We are gradually increasing the number of foreign orders, reducing the average size of orders, raising the unit price, so that risks can be reduced.

Twenty-first Century: what progress has been made in the integration of Singapore and Malaysia?

Li Rucheng: because the internal systems and production processes of Singapore and Malaysia are based on the rules of the European and American markets, and YOUNGOR is a native mainland enterprise, it is not easy to integrate.

The integration of market channels and information technology should be done first, and the integration of industry may take longer.

The shirts we used to make are all formal. Now they are more popular in the world. This is our weakness. We want to take the new horses' leisure shirts here.

In addition, we are forming a new company as a pilot to integrate new horses.

Singapore and Malaysia have many manufacturing enterprises in Sri Lanka and Southeast Asia. They can later be used as one of YOUNGOR's production bases to enhance YOUNGOR's ability to resist risks.

Twenty-first Century: in recent years, YOUNGOR's clothing industry has made less and less contribution to the company's profits. People's understanding of YOUNGOR's industry attributes is becoming more and more blurred. How do you think about it?

Li Rucheng: I have confidence in the clothing industry for several decades.

Chinese enterprises have their own difficulties, and the development of an industry has certain limits. Therefore, other industries need to be excavated to support the sustainable development of enterprises.

If we did not enter real estate and financial investment, today's YOUNGOR could not have a net asset of about 20000000000.