Shoe King BELLE: Products Are No Longer Novel?

According to the world clothing shoes and hats net,

In 2004, "reducing the princes" and channeled the channel resources in their own hands.

In the 11 years since then, BELLE has maintained a sharp increase in the number of retail outlets in the group.

To date, more than 2 retail outlets are considered the most valuable asset of the group.

However, under the impact of the electricity supplier, even after raising the unit price, BELLE has not stopped sales declining.

In its privatization announcement, it said, "the company

The business has suffered a sharp decline, and has recorded a 13 consecutive negative growth in the same store sales since the fourth quarter of February 28, 2014. "

The number of shops opened for 11 consecutive years has increased dramatically.

"China's retail brands start with channels, one.

If there are enough channels, it will be able to occupy the market, "said Tang Xiaotang, founder of fashion industry research and consulting firm No Agency.

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In 1997, in order to develop the shoe market in the mainland, BELLE signed exclusive distribution agreements with 16 individual distributors in the mainland.

BELLE's business model at that time was to produce shoes and distribute by distributors, which greatly increased the penetration of BELLE shoes.

A shoe shoe listed company secretaries told reporters, "we developed these brands in 90s, one of the path of development is channel expansion.

And according to our more than 20 years of development path, the occupancy rate of physical channels is very important, especially in the booming stage of department stores, it can be said who occupied the channel, who occupied the market.

But on the other hand, those who get the channel get the world, and the strength of the distributors will reverse the brand business in terms of pricing power and so on.

In 2002, Deng Yao and Sheng Bai Jiao began their first integration of channels.

Its joint distributors jointly set up BELLE investment, and agreed that BELLE investment replaced the former distributor as BELLE exclusive distributor, and initially controlled the right of distribution.

Most of the shareholders invested by BELLE are BELLE distributors, and most of them are "confidant" of BELLE management.

Such as Sheng Bai pepper nephew, the president of BELLE new business, who participated in the privatization, was once one of the shareholders of BELLE investment.

BELLE's distributors were once referred to as "Princes". BELLE's integration of retail outlets in 2004 was also known as "chiseling".

At the end of 2004, foreign investment restrictions in China's retail industry were relaxed. BELLE was also determined to expand its business to the retail market, and began the second integration of channel resources.

It bought its retail business from BELLE investment and further incorporated its retail resources into its arms. By August 2005, BELLE terminated its exclusive distribution business with BELLE, a wholly owned subsidiary of BELLE in October 2004, which is responsible for BELLE's retail business.

At this point, BELLE has covered every link of brand, design, production and sale of footwear industry chain.

It has brought obvious benefits to the expansion of retail business. In 2004, BELLE's consolidated income was about 871 million yuan, but its revenue in 2005 almost doubled to 1 billion 732 million yuan. It is the fastest growing year with financial data available. BELLE said that growth was mostly driven by retail business.

In September 2005, BELLE introduced Morgan Stanley and its participation in the privatization of CDH investment, further accelerating the expansion of retail outlets.

The investor subscribed HK $23 million 660 thousand for the redemption of common stock of 9860 shares of HK $0.01 per share and HK $288 million in the same day to complete the subscription of the additional redeemable common stock, and the shareholding ratio for BELLE international was 10.7%. The total amount of shares held by BELLE was 0.01.

At that time, BELLE International did not disclose the specific share of CDH investment.

According to the company's prospectus published in 2007, after the completion of IPO, CDH investment holds a 4% share of BELLE international shares, and two Morgan Stanley funds have a total of 4% to BELLE international, and 25% of the IPO fund will be used for the expansion of retail outlets.

With the help of capital, in the 11 years since 2005 ~2016, the number of BELLE's stores has surged and has become one of the largest retailers in the field of apparel footwear industry in China.

Same store sales fell for the 13 consecutive quarter

The huge retail system has become one of BELLE's most proud assets. But on the other hand, when physical retail is entering the cold winter, the huge BELLE is starting to end.

"BELLE's booth is too big, and it's difficult to pform it."

A shoe watchman told reporters.

It is worth noting that even if the same store sales decline, but the pace of BELLE shop did not stop.

Having tasted the sweetness of channel expansion, BELLE has paid more attention to "quantity" than "quality" in the later stage.

But since 2013, the number of single store output of BELLE footwear business has started to decline.

In the 2013/2014 fiscal year, BELLE international footwear business sales increased by about 0.6%, and the average paction price increased by more than 2%. In other words, the number of BELLE international same store sales declined in 2013.

The increase of single product price has balanced the declining trend of sales volume.

The alarm bell has been ringing, but BELLE has not stopped shop.

In the 2014 fiscal year, BELLE international footwear sales fell by about 4%, but there were 876 new retail outlets.

The crisis expanded in fiscal year 2015, and sales of BELLE footwear in the 2015 fiscal year dropped by more than 10%.

BELLE, which has always emphasized the number of shops, has to break arm for survival, and the retail outlets of shoes have been reduced by 366 in one year. In fiscal year 2015, the sales scale of BELLE's international footwear business decreased by 8.5% compared with the previous year, and the performance also appeared for the first time after the listing. Net profit decreased by 38.4% to 2 billion 934 million yuan compared with the previous year.

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This year CEO Sheng 100 pepper attended the performance briefing, saying that BELLE international listed after the first decline in performance, I am sorry.

In the 2016 fiscal year, BELLE international continued its downward trend. According to its performance forecast, the net profit of 2016/2017 will decrease by 15%~25%.

In the privatization announcement, BELLE is so frankly speaking about the dilemma facing footwear business: "the footwear business of our company has suffered a sharp decline, and the same store sales have recorded negative growth for 13 consecutive quarters since the fourth quarter of February 28, 2014."

Despite the reduction in the number of shoe retail outlets in BELLE's 2015 fiscal year, the total retail sales of BELLE continued to grow due to the increase in sports and clothing business. As of 29 February 2016, there were 21071.

As of February 28, 2017, BELLE international had 20716 retail outlets, and the total number of retail outlets declined for the first time.

Online channel failure

In some sectors, the most important reason for BELLE's poor performance is the change in industry.

The sales strategy of the brand's "get the access to the world" is no longer effective. BELLE's most proud channel bonus has begun to dissipate. "Shopping centers and other new shopping formats are rising. For consumers, they can also buy goods through electronic business and sea scouring. BELLE's channel advantage is no longer obvious."

Tang Xiaotang pointed out.

"BELLE's shoes have always been very expensive. For a pair of money, I can buy two pairs of the same quality on Taobao, some of which are still hand-made."

Consumers Guo told reporters.

In the face of the aggressive electricity supplier, BELLE also took the initiative to attack, and the time was earlier.

In August 2008, BELLE group's Bai Lang commerce opened a number of BELLE Direct stores on Taobao network, and built its own electronic shopping mall. In addition, it also authorized many Taobao network merchants to sell BELLE products online. In 2011, BELLE began to operate BC2 platform purchase network, and Taxiu network was merged into the excellent purchase network.

Ma Gang, an independent critique of shoe and clothing industry, pointed out that BELLE's e-commerce has problems such as poor promotion, low entry rate, poor visual sense of web display and weak attraction to netizens.

Ma Gang said at the same time, take Tao Xiu net as an example, Tao Xiu net mainly calls the stock of BELLE main warehouse in Shenzhen, while the BELLE shoe department set up 11 sales areas in the whole country. The sporting goods Agency Department has set up 9 sales areas in the whole country, and the channel resources have not been fully utilized.

As BELLE said in its 2012 annual report, "the fashion category B2C platform has no successful case because of its product characteristics."

Vertical electricity suppliers are too small to be able to balance the huge performance decline of offline stores.

Hu Chuncai, chairman of Shangyi consultancy, pointed out that the electricity supplier has a strong Matthew effect, and the individual shops that are alone can hardly compete with the powerful platform, resulting in the strong and strong situation, and the weak have little chance to turn over.

Products are no longer novel?

Analysts believe that BELLE emphasizes the number of stores and uses retail companies to locate itself, which gives the impression that BELLE pays more attention to channels than products themselves.

In addition, in recent years, BELLE's products have repeatedly been accused of inadequate innovation, too conservative style and homogenization. This is also considered an important reason for the same store sales decline.

Consumer Xiao Zhao told reporters, "BELLE shoes are of good quality and are very willing to use materials. They will not be bad if they soak the water. But over the past two years, the styles are too old, they are not as good as they used to be, and the styles sold in the new season are not different from those seen in the previous year, and there are no popular elements at the moment."

"Good or bad is actually the subjective feeling of consumers.

In the past few years, China's department stores and brand names were relatively small, and consumers chose relatively little. However, more and more foreign brands have entered China recently. "Fast fashion" is taking off quickly, which can ensure a fast new speed, and consumers' choices are more and more. By contrast, BELLE products may not be as good as before.

Tang Xiaotang pointed out.

Tang Xiaotang said that different brands have different understanding of fashion, but all brands are very similar in product design and production. Retailers and supply chains have very flexible reaction mechanisms to adjust, "what shoes sell well, and what shoes do not sell well." (brand) their response to sales data is more sensitive than consumers, and they will design products for next season accordingly.

Some luxury brands only sell one or two styles over the years, which does not mean that the brand's design and production have problems.

In fact, BELLE can be said to be the pioneer of this "retail oriented" mode in China.

Ma Gang, an independent observer in shoe and garment industry, pointed out that since 90s, BELLE has chosen marketing director as production supervisor and design director to pform market sensitive information into product driving force.

But analysts believe that, to some extent, this reflects the weak position of BELLE's internal production design department in compromising the sales department.

Depending on the sales volume of last year, the next year's production style is determined to be unable to catch up and lead the trend.

"The channel and the brand side can make up for the lack of the other side, but the two can not be split, and the brand is the foundation."

A shoe executive listed company executives told reporters.

More interesting reports, please pay attention to the world clothing shoes and hats net.