Why Were The Seven Kings Of The Wolf Abandoned By Men?

When it comes to men's clothing, what brand do you first think of? Is Hai Lan's home? But before the home of Hai Lan, the men's clothes were all seven wolves. When the seven wolves were all over the country, there were no brands like Hai Lan's home and Metersbonwe. In the average monthly salary of thirty or forty civil servants, seven wolves sold a jacket for 100 yuan, which was also in short supply.

But the vicissitudes of life, once the king's men's seven wolves, has been gradually abandoned by men. Ma Yun has launched the Internet shopping, making the online brand business develop rapidly. The traditional clothing brands have been hit hard. At the same time, foreign brands have settled in, and have seized the market quickly from the domestic brands. Many domestic brands have been devastating, from busy selling clothes to busy shops. Strong as the sea LAN home also encountered growth bottleneck, slow growth. The seven wolves help themselves through diversified development.

One, seven wolf wolf clothing performance since 2013 ushered in a huge blow.

2012-2013 years is a major turning point for the domestic clothing brand. Many clothing brands have suffered from Waterloo since then. Seven wolves did not survive, and their performance declined since 2013, when revenues and net profits fell by 20.23% and 32.44% respectively. In the dominance of men's clothing, the crazy shop expansion became a drag on the seven wolves. The number of stores decreased from 4007 in 2012 to 2821 in 2014.

Most domestic clothing brands operate in light asset mode, and spend money on brand promotion. This is also why Semir and the United States and other brands were popular in those days. Although the seven wolves were initially "autonomous + outsourcing" mode, they did not increase investment in fixed assets, but began to "outsource" and gradually turn to light assets. The disaster of the domestic brand is also related to this. There are three main reasons:

First, the online impact has led to a slump in the offline market. The rise of a series of Internet shopping platforms led by Ma Yun's Taobao has bred many online brands. Online brands do not need physical stores, no rent, low operating costs, product prices are cheaper than physical stores, and products are more abundant, providing consumers with more choices. Since then, there has been a huge blow to the physical clothing stores under the line, and the market has been sluggish.

Second, the extrusion of foreign brands has made the domestic brands lose the market. A large number of foreign brands have entered China to create "fast fashion". Taking ZARA as an example, with its huge design team and supply chain advantages, new products only need two weeks from design to shipment, while domestic brands need 4-6 months, which simply can not keep up with the speed of launching new products from foreign brands. ZARA new products "a small number of", there will always be one you will like. The domestic brand is a large backlog of stocks, which is a fatal blow under the light asset mode operation.

Third, domestic brands lack the ability of independent innovation. UNIQLO, ZARA and other user demand oriented, create a "flexible supply chain", quickly launched to cater to the needs of users. Domestic brands do not have such huge design resources and supply chain management capabilities. Naturally left behind, losing a lot of market. From the research and development input of the seven wolves, it dropped from 109 million in 2013 to 52 million 780 thousand in 2018, and the R & D input rate also dropped from 3.92% to 1.50%. Do not pay attention to R & D, what products and people to fight?

Two, seven wolves diversified operation to save themselves

Underwear, underwear and socks become the main force of the seven wolves. Business was gloomy, but the seven wolves did not wait to die. In 2014, the seven wolves resumed the original trademark authorized by foreign trade, and began to make men's underwear, underwear, socks and knitted products. In the first half of 2019, the business revenue of the seven wolves was 1 billion 555 million yuan, of which underwear, underwear and socks contributed 33.23% of the revenue. In 2015, the wolf wolf annual report said that other categories were mainly underwear, underwear and socks income. This part of the business has become the main revenue force of the seven wolves.

The gross profit margin of underwear, underwear and socks is lower than the gross profit margin of other products. Although the underwear, underwear and socks products sell well, the gross margins of these products are lower than those of other products. Although the revenue of seven wolves has been rising rapidly in recent years, it has surpassed the peak period in 2012, but the net profit increase is much slower.

Clothes are not easy to buy, but seven wolves invest well. When the three brothers of the seven wolves were not ready to sell their clothes, they were very fond of investment. They were also a way to diversify themselves. The real estate investment income of the seven wolves headquarters even once exceeded that of the seven wolves. In listed companies, investment income has also become an important part of net profit. Net profit in 2018 is 346 million, and investment income is 154 million. But the seven wolves will always be in the clothing business. Is this a bit of a problem?

Three. The seven wolves are paying more attention to the clothing business.

In 2017, the seven wolves bought and bought the Karl Lagerfeld Greater China Development Limited, the French luxury brand of the same name, and wanted to join the fashion team and enrich their fashion brands. But the company's business development in China was not very satisfactory. After the acquisition, it lost 40 million 138 thousand and 200 in 2018 and 15 million 574 thousand and 700 yuan in the first half of 2019. It seems that the acquisition did not create a fashion for the seven wolves, but it was a drag on performance.

In 2018, the seven wolves finally remembered that they were making clothes, and declared that they should focus on developing their own clothing business afterwards. In addition to building its own brand "seven wolves", the seven wolves are also working hard to build their own early luxury brand WOLF TOTEM and the brand of "Chao 16N" in 2016. Han Yu, the champion of hip hop, is also invited. The seven wolves are trying to make their products mature and fashionable, and want to be recognized by new young people.

Four, summary

Although the seven wolves have gone to Milan fashion week for the four time, they always give people a sense of brand that their father wears. When the domestic garment industry is at a low point, it will diversify its development and increase its sales by selling socks and underwear. Even so, it will be difficult to increase profits. Maybe I have never put my mind on clothes, I just want to invest. Now focusing on the development of clothing business, the acquisition of the same name brand in 2017 has not changed itself. There is still a long way to go to build a fashion brand.