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Industry Downturn Lining Bear The Brunt

2013/5/4 19:24:00 69

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the sport that once made Chinese proud of "a target=" _blank "href=" http://www.91se91.com/ "clothing" /a "brand" Lining "is now in constant trouble.

Lining's earnings report in 2011 showed that the gross profit of the company dropped by 8 percentage points to 46.1%, although Maori still ranked the top five sporting goods providers, but the net profit was only 386 million yuan, less than half of PEAK's net profit 780 million of the five largest sports brands.

In the past two years, the company's share price has dropped from the highest of HK $30 to the current HK $5.1.

Li Ning Co was once a well deserved big brother in the Chinese sporting goods company, founded by the former Chinese gymnast Lining in the late 80s of last century.

After its listing in Hongkong, China in June 2004, it maintained a sustained high growth rate until 2010.

the recognition of Lining brand in the eyes of consumers is closely related to the image of "sports athletes who win glory for the country". Especially during the 2008 Beijing Olympic Games, when Lining ignited the Beijing Olympic torch, the products of Li Ning Co began to sell well.

but not for a long time. With the passing of a group of loyal consumers, the "two words" of Lining have not helped much in brand building.

In the past two years, "Lining" is more troublesome: inventory backlog, profit decline, executives leave, after years of ups and downwind growth, "Lining" seems to be a waiting patient to save.

industry drop, Li Ning Co bear the brunt of /p >

"any enterprise is inseparable from the environment, the so-called current situation makes heroes."

The key Road Sports Consulting Co., Ltd., CEO Zhang Qing, told the investor newspaper.

And Lining is riding the current situation from the past 1 billion yuan quickly rushed to the level of 9 billion yuan turnover.

, but the turning point is also here.

In the past five years, the average growth rate of domestic sporting goods brand stores is about 10%, while the growth rate of sales is about 20%.

Since 2011, the growth rate of domestic sporting goods industry has slowed down.

The annual report of sports brands listed in China in 2011 shows that industry growth is slowing down due to high inventory and rising costs.

"P >, especially the problem of overstock, has become the bottleneck of the development of various enterprises.

"Last year was very difficult. Maybe this year it will be a bit better for the Olympic Games."

A sporting goods agent told the investor newspaper.

according to Li Ning Co's 2011 performance report, Lining's sales in 2011 dropped by 5.8% to 8 billion 929 million yuan, while net profit dropped by 65.16% to 386 million yuan.

For the sharp decline in performance, Lining said in the earnings report, mainly due to the impact of the sharp rise in inventory, data show that last year, Li Ning Co inventory amounted to 1 billion 133 million yuan, an increase of 40.57% over the same period of 806 million yuan over the same period last year.

although Lining also increased the wholesale discounts for dealers, took inventory repurchase measures, and actively expanded the construction of factory stores and discount stores, and strengthened the sales of network platforms, but the inventory of Li Ning Co still exceeded one billion, and the effect of clearing inventory measures was not obvious.

at the same time, because of the excessive discount, some dealers resent it.

"last year I saw many small dealers removing Lining.

Lining sells badminton equipment as a fast food product. He discounts the goods in a season, and often sells goods at a much lower price than futures.

But I heard that Lining started correcting this mistake this year, and how the effect will be verified by time.

The dealer told the investor newspaper.

of course, the high storage is not the Lining family.

Anta, PEAK, PEAK and other sporting goods enterprises have seen varying degrees of growth decline and high inventories.

31st degree Bulletin shows that the stock in 2011 was up to 4 billion 512 million yuan, up 81.8% from 2 billion 482 million yuan in 2010.

Anta's previous annual report also showed that as of December 31, 2011, Anta's inventory amounted to 618 million yuan, up 36.1% compared with 454 million yuan a year earlier.

March this year, PEAK CEO Xu Zhihua also indicated that the retail terminal inventory was about 1 months, and the distributor inventory was 5 months to 6 months, and the overall inventory was about 6 months.

At P's news conference held in July 5th, Li Ning Co also said that it would mainly solve inventory problems in the next 6~12 months.

brand reinventing "Lining", losing oneself, /p >

Why is Lining, P, a troublesome young man who has been in trouble for a while?

In 2008, Lining exhibited himself in the air above the bird's nest, and his company made outstanding achievements in that year. P

However, the extremes of things were reversed. In 2009, they became weary. They found that their user layer was gradually aging, while the main consumers of sports brand were young people.

So in 2010, Lining resolutely implemented the strategic pformation marked by the change of mark, and carried out the actions of changing bid, changing slogans, raising prices and changing channel policies.

June 30, 2010, Li Ning Co released a new LOGO in Beijing. The figure named "Lining cross action" has become a new symbol of Lining brand. Meanwhile, the new slogan "Make The Change" has replaced the original slogan "anything is possible".

at the same time, Li Ning Co launched a group of "post-90s Lining" advertising, but this advertisement has caused trouble for itself.

"when I saw the advertisement of Lining after 90, the first reaction was that Lining abandoned us in the 1980s."

A Post-80 consumer said to investor newspaper.

He believes that Lining can be fashionable, but also can please the new generation, but this expression, it is easy to offend people of other ages.

reporters have asked many post-90s consumers why they do not choose Lining's products.

They answered, "is Lining a brand?" in fact, Lining did not really understand the post-90s.

despite the fact that afterwards, Li Ning Co stressed that Lining was not positioning the post-90s consumer group, but that Lining was a post-90s company.

But this effect has been caused.

As a result, the change of the standard did not strive for the post-90s, but also lost 70, after 80, and other consumers.

"although we admit that the continuous aging of brand is an eternal proposition. Like some hundred years old brand, we need to constantly seek the younger generation, but we can not lose ourselves."

The key Road Sports Consulting Co., Ltd., CEO Zhang Qing, told investors newspaper.

"Lining's post-90s positioning is not necessarily wrong. Even Nike's positioning is also a primary and high school campus market. However, in the process of Lining turning, ignoring the feelings of old users, this is a failure, and sports brand audiences are younger. This is a realistic choice."

The senior sports industry practitioner Qu Zheng said to "investor newspaper".

many people in the industry also told the investor newspaper that Lining's post 90s publicity was not wrong, but the expression was too radical.

"there is a theory in game theory that the leader should take the same strategy as the following if he is to keep the lead, because it can keep the advantage over the followers, and the followers should take an innovation or risk strategy so that they can get ahead of the leader."

Sun Xi, a researcher at the Institute of public communication of Renmin University, said to the investor newspaper.

But the strategy of innovation and adventure is entirely due to Li Ning Co's erroneous judgement of the market.

Worse than P, Li Ning Co has raised prices, which has completely hurt consumers' minds.

"basically, there was a raise at the beginning and the main 400~600 yuan was actually very embarrassing, because ADI and Nike were the same price.

What is more regrettable is that at that time, the low price < a target= "_blank" href= "http://www.91se91.com/" > shoes < /a > have been cut down, they can not be retained.

This has created opportunities for Jinjiang garment enterprises.

Lining did not succeed in going up, and there was no guarantee in the market below, "said an investor from the Li Ning Co product manager post.

Li Ning Co CEO Zhang Zhiyong has admitted that the price hike has made Lining lose some loyal customers.

Fashion Sports Strategy wavering indefinite /p >

Compared with the positioning of the post-90s mistakes, what P can't understand is that Lining's strategic swing between sports and fashion is uncertain.

thanks to the marketing strategy of the 2008 Beijing Olympic Games, Li Ning Co's performance has shown a good upward trend.

In 2008, China's domestic sales exceeded Adidas for the first time.

After that, Li Ning Co began to spread many brands and expand to outdoor, table tennis, badminton and sports fashion. Badminton was also identified as the core category of Lining.

> "paying attention to fashion and focusing on sports function" has always been the two brand strategy choice of domestic sports brands. As an example, Lining began to rely on sports function.

In particular, the brand running on the fashion line represented by Kappa is also good.

In fact, the operation of fashion brands and sports brands is basically not a way. This kind of hedging strategy has limited market space in time.

Qu Zheng said to the investor newspaper.

but too dispersed fronts did not bring good benefits, but increased operating costs and wasted a lot of resources.

In the past three years, the brand of Lining layout, only outdoor brand AI Gao benefited from the growth of the industry, showing signs of profit growth.

Other brands such as Lotto and red double happiness are different levels of losses.

"generally speaking, the ambiguity of Lining brand is large and the swing is obvious.

Lining used to have Oriental color, Oriental innovation elements and sports spirit to lock in mainstream sports development.

As a result, there are swings between fashion and sports, new customers do not catch them, and old ones are lost.

Zhang Qing said.

sports spirit began to fade in Lining's blood.

With a group of loyal consumers going on, the two word "Lining" has not helped the brand building much, because now how many consumers will remember the gymnastics Prince of that year.

Maybe a few years later, even the story of Olympic fire has never been remembered by young consumers.

in addition, Lining is somewhat less fashionable in pursuit of fashion.

"Lining has a bit of fashion and novelty, and feels that they want to design fashionable and good-looking, but a bit artificial, it seems to be fashionable and fashionable."

A Post-80 consumer told the investor newspaper.

now, Lining, who has realized the crisis, is determined to return to sports.

At the annual meeting of the company in 2011, he pointed out the problem of the company: we must stop swaying between professional sports and sports fashion and concentrate on sports.

He also proposed that resources should be collected from various sub brands and concentrated on Lining's core brand.

The sponsorship of CBA under "P" is being seen as an important measure of this "return".

In June of this year, Lining sponsored CBA at a high price, though this decision was considered to be a big gamble.

But its determination to return to sports can be seen from this.

blindly arrogant management confusion

2008, after the Lining Olympic Games ignited, the company was somewhat dazzled by victory and arrogant and complacent began to spread inside the company.

"at the end of 2008, we saw the potential danger of the company.

People are impetuous, employees feel good about themselves, and the company is simply not going to pay for it. "

Another unnamed person who has resigned from Li Ning Co said to the investor newspaper.

he gave an example. The company made hundreds of thousands of thousands of thousands of people for an annual event. At that time, everyone knew about the tricky stuff, but the management felt it was nothing.

More importantly, Li Ning Co began mass layoffs and blood exchange. Although it claims to be cutting costs and doing internal control well, it is loyal and veteran employees.

"There are more new employees coming from here than in the past. This is internal control. It is HR's political struggle.

To be a company is to be a man, but to be frugal is to be extravagant.

The insiders said angrily.

as a public enterprise that has been listed in Hongkong, Lining should be able to reflect these problems in time.

"executives and middle class are all hot headed by the victory in 2008.

So being opinionated, I feel that I have not made a single mistake.

The company does not give employees reasonable channels to reflect their opinions.

The company has the right to speak at least in the middle level of the director, while the senior executives only listen to the middle level reports, so there is no democratic atmosphere inside the company, nor can the enthusiasm of the employees be mobilized.

If you say that, you will surely offend the factional interests of some companies and become embroiled in factional disputes.

The insiders said.

the early Li Ning Co actually used Chen Yihong as the core of power. Later Chen Yihong left, and Zhang Zhiyong became the core of Li Ning Co.

Lining is only a major shareholder and spiritual leader in the company.

"Lining is so good that he can easily trust others."

The insiders said.

It is this way of spreading the hands that makes the once proud management system a problem.

Li Ning Co will face new challenges regardless of strategy, positioning or consumers.

But will Lining still have the chance to reinvigorate his power in the future? Or, will city time give Lining the time and cost of making mistakes?

"it depends on whether its strategic adjustment is effective.

Unlike the IT or mobile phone market, the sports apparel market is changing so fast. I believe that Lining still has its system capability and reserve strength.

Sun Xi said.