Daphne's Market Value Fell By 97%! How To Solve The Problem Of Shutting Down Shop Stops?

Daphne, the popular shoe king, has had a hard time in recent years.

Recently, there are news that Daphne is located in the capital business super part of the store is clearing the store. Daphne International (hereinafter referred to as Daphne) market value jumped from HK $about 17000000000 in the peak period to HK $470 million in August 14th.

Stores in Beijing are only a microcosm of Daphne's performance in recent years. Low price, relative fashion, and the industrial chain controlled from production and processing to terminal sales made Daphne once become the "shoe king". At its peak, Daphne's performance began to decline year after year. In the wave of consumption upgrading, Daphne's low cost and high performance price advantage seems to be at a disadvantage.

In April this year, the head of Daphne International Secretariat told the media that in recent years, Daphne has been extending to the sports and leisure market. Meanwhile, in order to strengthen the business of e-commerce, Daphne has opened up a special product development channel for the electricity supplier since this year. Daphne's physical stores are moving further from the streets and shopping malls to shopping centers.

The reporter sent an interview letter to Daphne about the reasons for the dismantling of some stores in Beijing, the expansion of shopping center stores, brand and quality and so on. As of press release, no reply was received.

Ge Jia, an Internet analyst, argues that Daphne has shifted its physical stores to shopping centers or considered cost considerations. Shang Chao and shopping center are different in business mode. Shang Chao is the quota payment, shopping center is paid by the amount. Under normal circumstances, brand operators need to pay the entry fee or rent when they enter the business, while the shopping mall is similar to the platform mode, which is divided into a certain proportion according to the brand sales, and the risk is shared with the brand. The two models have their advantages and disadvantages. For Daphne, the risk of shopping centers seems to be smaller.

　 Walk down the altar

The name "Daphne" is named laurel goddess in Greek mythology. "Beautiful 100 points, beautiful without discount." This slogan of Daphne has become an unforgettable memory for many people. According to media reports, in the "high light moment", Daphne can sell nearly 50 million pairs of women's shoes every year, and its market share in China has been close to 20%. That is to say, one out of every five women wears Daphne.

The performance of Daphne, which once dominated the domestic market, continued to deteriorate. In April 15th, Daphne surrendered the worst annual financial statement in history. The 2018 annual financial report issued by Daphne showed that the turnover of the company was HK $4 billion 127 million 100 thousand, a year-on-year decline of 20.8%, gross profit of HK $2 billion 61 million, a decrease of 25.1%, and operating loss of HK $786 million 600 thousand, which was larger than that of the previous year (the operating deficit was HK $688 million 800 thousand last year). By 2018, Daphne had been losing money for four consecutive years.

Sky eye check shows: Daphne International Holdings Ltd was founded in Hongkong in 1987, and has now developed into a diversified business group with footwear industry's R & D, production, processing and sales. Its business is located in mainland China, Hongkong, Taiwan, Europe and North America. The main business is OEM. After the opening of the two sides of the Taiwan Strait in the late 80s, China began to expand its business in the mainland of China.

In 2002, Daphne began to expand and accelerated after 2005. At that time, Daphne adopted the form of Street store and franchised expansion, the main product price from 200 yuan to 300 yuan, and the sales channels that focused on four line to six line cities, making it develop rapidly.

In the ten years from 2003 to 2013, the number of Daphne's general store shops increased from 739 to 6702 in 2013. In 2012, the number of Daphne stores reached a peak. There were 6881 brand stores, with a turnover of HK $10 billion 529 million. The controlling shareholders should account for HK $956 million in profit and HK $17 billion in market value. At that time, Daphne had boundless scenery.

However, Daphne's huge store system is gradually exposing its drawbacks. Beginning in 2012, Daphne began to feel the pressure due to the rise in store rents and sales costs. At that time, sales cost almost accounted for half of the sales revenue, plus too much inventory, long turnover days, and funds were heavily occupied. In 2015, Daphne suffered its first loss in nearly 10 years, and net profit fell more than 300% over the same period.

And after reaching its peak in 2012, Daphne's turnover has declined for six consecutive years. The annual report shows that in 2013 -2018, the turnover of Daphne was HK $10 billion 447 million, HK $10 billion 356 million, HK $8 billion 379 million, HK $6 billion 502 million, HK $5 billion 211 million, HK $4 billion 127 million, and by 2018, Daphne's revenue was less than half of its peak.

In the face of the depressed market, Daphne chose to stop shop. In the earnings report, Daphne said that in the face of an increasingly deteriorating business environment, Daphne accelerated the closing of the loss shop to enhance overall business efficiency. In addition, Daphne is trying to increase its market penetration through the sales channels of more fashionable shopping centers, so as to adapt to the fast changing consumption patterns and consumer preferences. 2018 annual report shows that there are only 2648 Daphne stores, down 26.2% compared with 2017.

Recently, Daphne has been reduced by shareholders. Eastern wealth network shows that in July 16th, Daphne international was Wellington Management Group LLP with an average price of HK $0.1750 per share, holding 8 million 454 thousand and 500 shares, with a total price of HK $1 million 479 thousand and 500.

This is not the first time Wellington Management Group LLP has reduced Daphne in the short term. In June 26th, HKEx's rights and interests data showed that Daphne international was reduced by 38 million 508 thousand HK $0.19 per share in the Wellington Management Group LLP, involving about HK $7 million 316 thousand and 500.

"At present, investors tend to prefer faster growing industries or high profit industries. Daphne is a traditional manufacturing industry, but its performance is not optimistic. Ge Jia said.

　 Online frustration

Daphne started in the line, in 2006, Daphne began to set foot in the electricity supplier, entered Tmall in 2009, and began to build self operated electric business company "love to carry". After that, Daphne reached cooperation with dozens of online sales platforms such as Jingdong, Holle, vip.com and so on.

In 2010, Daphne management decided to work with Baidu to invest in the e-commerce platform, "Yao point 100". In order to fully support the development of 100, Daphne has squeezed the development of its own e-commerce business. According to media reports, at the end of 2011, Daphne even closed Jingdong, Le Tao and ho Le buy and other advantages of e-commerce distribution channels, to support the 100 point.

Unexpectedly, 100 less than two years after the burning point, 3 hundred million burned out and about 30000000 yuan in debt. In July 2012, Yao point 100 terminated the operation of the website; in March 2013, the people's Court of Pudong New Area of Shanghai ruled that it would accept the bankruptcy liquidation 100. Until it went bankrupt, 100 of Daphne still owed some of its loans.

The failure of "Yao point 100" has brought a major blow to Daphne's e-commerce business. It was not until 2013 that Daphne began to attach importance to the development of the electricity supplier in its annual report. However, at this time, the competition of shoe brand e-commerce has entered a more intense period.

Although the two start is late, Daphne's electricity supplier is still the only profitable project in all businesses. Daphne said that in 2018, its business continued to increase its contribution to the group's turnover and maintain profitability. In order to adapt to the fast changing consumer behavior and consumption patterns, the group has launched more funds for online sales and strengthened cooperation with emerging e-commerce and social platforms.

　　 Brand aging

The noisy streets, the old-fashioned style, the messy furnishings, the discount signs are everywhere, and the soprano announces the latest sales promotion message, which is now the appearance of the shops under the Daphne line in people's minds.

Daphne took the middle and low end of the popular route. Reporters at Tmall Daphne official flagship store, Daphne shoes are doing activities, the price is 69 to 519, including commuter shoes, middle / high heels, tooling shoes and sports shoes and other categories.

"While the growth of consumption is slowing down, the trend of consumption upgrading has emerged. Daphne's brand positioning is in the middle and low end, and lacks in brand upgrading. Ge Jia said.

A report released by the prospective industry research institute shows that the consumption of women's shoes now has three major characteristics, namely, the upgrading of consumption, frequent consumption and increased purchasing channels. As for consumption upgrading, the report points out that the function of women's shoes has developed from a single protective nature to self expression, which has promoted the fashionable and healthy consumption. Women consumers of different culture, income and age have different brand choices, price choices, style choices and style choices.

Li Gangjian, co-founder of Ying Shi brand consulting, thinks Daphne has been lagging behind in its brand becoming younger. Under normal circumstances, behind every brand is the memory of a generation. In the past 20 to 30 years, the generation is now 10 years, even 5 years. The Internet has accelerated the launch of new brands, making the brand cycle shorter. At the peak of the brand, it is very important to have a sense of crisis and cultivate a younger brand to catch potential customers.

"At present, many brands are still at the functional level, while strong brands often involve values. If we only stay at the functional level, we will continue to launch new products. However, with the development of modern technology, the product is updated rapidly at the functional level, and the life cycle of the brand becomes shorter. Therefore, it is not enough to stay at the functional level to meet people's needs, but also to establish and inherit the values of the brand. The functional level and the value level belong to two dimensions. We need to establish connections between them so as to make functional support values. " Li Gangjian said.

In Li Gangjian's view, with the upgrading of consumption, people pay more attention to brand values and brand tonality when buying goods and services. At the level of value, retain old customers and attract new customers. At present, Daphne's values are not clear enough. " Li Gangjian said. Author: Liang Wei Shi Dan