City Beauty Will Become China'S Underwear Brand Tycoon.

As the saying goes, "three years of age eighty," means that when people were educated when they were young, the environment of life may have a far-reaching impact on them.

According to the world clothing shoes and hats net, the same is true for business enterprises. When an industry rises, participants will inevitably flock to it, and the competition pattern is very dispersed.

At this time, how to locate the product and adopt the development strategy is the key factor for the industry to stand out.

Take the sports brand.

(02331) and

(02020) in the past, Lining made a big effort to compete with Nike and ADI in a large number of stores in the first tier cities. The result was a rebuff, while Anta took the three or four line city as the base camp, and finally became the first sports brand in China.

Now, the story of Anta's rise is likely to be women.

The market is on the stage.

Competition in underwear market

Research shows that as of 2015, China's underwear market competition is very fragmented, and the market share of the top ten domestic underwear brands is less than 12%.

Among them, the market share of the largest underwear brand, urban beauty (02298) share of 3.2%.

From the perspective of competition pattern, the competition of underwear market in our country is still at the primary stage, and it has a long way to go than the mature market in the United States and Japan.

But we should know that any market is from scratch, from primary to mature, but immature market has given rise to the soil of enterprises in the industry.

As we all know, China is one of the largest consumer goods markets in the world. Will the urban beauty in the global market become an enterprise that grows from a trickle to a sea of rivers and lakes?

Urban beauty relies on product positioning to stand out?

To answer this question, it depends on what products and services the enterprise provides for consumers, and whether consumers accept such products and services.

According to Sullivan, the market for underwear market in China is about 220 billion yuan in 2014, and its market space is expected to reach 500 billion yuan by 2019.

China's underwear market has the largest proportion of the mass market, about 60-70%, the high-end market share is about 23-24%, the low-end market accounts for about 6%-17%, and the high-end and low-grade market is shrinking.

It is understood that the positioning of "fast fashion" urban beauty, products are the main consumer market, the price of products is mainly in the range of 50-150 yuan, is the only 10 Tmall underwear brand at this price brand, has a high cost performance.

Such positioning is a large number of fans who are attracted by urban beauty.

Reporters noted that the number of fans of the Tmall official flagship store has reached 2 million 820 thousand, and the fans of Ordifen's underwear flagship store also reached 328 thousand.

The fans of its rival, Tmall, and the secret of Vitoria, the fans of the Tmall flagship store are 2 million 300 thousand, 2 million 223 thousand and 1 million 90 thousand respectively.

It can be seen that city beauty has strong brand appeal in the underwear market.

However, you may criticisms that the reason why urban beauty attracts so many consumers is mainly the price of the company's products, but the profitability of the company will not be less than that of its competitors.

Cost leadership strategy to enhance operational efficiency

It is understood that the business strategy adopted by urban beauty is a cost leadership strategy with small profits and quick turnover. One of the greatest characteristics of this strategy is to compress product profit margins and maintain high efficiency to win more market share.

Urban beauty 2017 mid-term performance report shows that the gross profit margin of the company during the period is 45.1%, down 2.6 percentage points year-on-year.

But the company controls the further decline of profits through cost control. In the middle of this year, the operating profit margin of urban beauty was 9.5%, and the decline was 0.6 percentage points.

In terms of operational capital management efficiency, the company's accounts receivable turnover days are 37.9 days, and accounts payable turnover days are 85.5 days, which reflects the company's healthy capital management efficiency and strong bargaining power.

However, the number of days of inventory turnover increased significantly from 40 days to 181.8 days, mainly because the company reserves a large number of new products for the second half of the year, resulting in a total new product share of over 65%, and the company's inventory increased from 890 million yuan in the same period last year to 1 billion 157 million.

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However, it is understood that the stock of the city is maintained in a healthy state of less than 90 days.

On the other hand, the company will enter the Southeast Asian market in the second half of the year, and open 50 discount stores in the three or four line cities, together with the holiday promotion of e-commerce channels, all of which can effectively reduce the inventory.

Company management predicts that by the end of 2017, the inventory level of the company will be lower than that of 2016.

In contrast, the rival of the city beauty, adopting the differentiation management strategy, the A share listed company Hui Jie shares, the main middle and high-end market, the selling price of most products is more than 200 yuan, which makes the company's profit level higher than the middle of this year's gross margin and 68.88%, and the net interest rate is 17.8%.

But Hui Jie's inventory turnover efficiency is far less than that of urban beauty. In the mid 2017, the inventory turnover days of Hui Jie were as high as 350.74 days.

In my opinion, it seems more important to win more market share in the early stage of an industry competition.

For example, in the early stage of its birth, the mobile phone industry is headed by the cost leadership strategy. It does not build factories and has no offline stores. Even marketing is done through micro-blog.

These measures have greatly reduced the cost of the company and sold the mobile phone to consumers at a very low price.

But today, the concept of consumption upgrading has been deeply rooted in the hearts of the people. Today's millet is no longer satisfied with the low-end route, and has begun to force the high-end mobile phone market.

The same concept of consumption upgrading will inevitably affect the underwear market. How will the urban beauty face this time?

Product upgrading + channel construction

It is understood that the urban beauty in the acquisition of Ordifen more than two years later, launched the upgrading of the brand "Ordifen+".

It is a completely innovative upgrading of Ordifen's habit of following the consumer's habits.

All these are plans for urban beauty to enter the high-end underwear market.

With the upgrading of consumption to win popular support, all brands want to go to high-end.

After all, high end means not only better brand image, but also higher gross margin.

The original intention of the city beauty to buy Ordifen is also hoping to pry open the high-end underwear consumption market with broad prospects in China with Ordifen as the entrance.

It is understood that in May of this year, Ordifen launched the first underwear outwear Theme Store Ordifen+ in China. The new upgrade brand has also entered 10 shopping centers, and will expand rapidly next year.

At the same time, the urban beauty has begun to get out of the haze of closing shop in 2016. It is expected that 250 stores will open in the second half of 2017, and the proportion of shopping centers and large stores will further improve.

On the construction of online channels, the urban beauty has also made brilliant achievements. In the first half of 2017, the sales revenue of the company's e-commerce channel reached 238 million yuan, an increase of 44% over the same period, and the gross margin reached 56%.

Urban beauty CEO, Sha Sha, said in October that the growth of business performance in the first half of the year was in line with group expectations.

"Urban beauty sales on Tmall platform average annual growth rate reached 100%, vip.com's growth rate can reach 60%-70%.

The average growth rate of these three platforms, Tmall, vip.com and Jingdong, is about 87%.

At present, the goal of completing 750 million this year is no problem.

From the point of view of revenue, the proportion of e-commerce sales this year may exceed 10%, and next year will be around 12%-13%.

On the whole, the dawn of urban beauty has grown up as the giant of underwear brand in China. When will it be achieved? Only time will be tested.

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