Urban Beauty Expects The Median Net Profit To Fall More Than 80% In The Future And How To Save Itself In The Future.

Recently, the local fast fashion underwear brand city beauty (China) Holdings Limited (hereinafter referred to as "urban beauty") issued a profit warning. It is expected that in the first half of this year, the total profit attributable to the owners of the company will fall by no less than 80%. City beauty said that in order to improve the future operation of the group, the group has adopted a number of measures aimed at revitalizing the group business. Will the urban beauty business improve in the future?

The announcement shows that the decline in performance of urban beauty is mainly due to the weak economic impact of China's retail industry, resulting in a high unit figure percentage decline in the group's revenue and a fall in gross margins. Moreover, due to the tightening of some suppliers' environmental regulations, the cost of raw materials supplied by them increased, resulting in an increase in the cost of raw materials for the group. At the same time, because of the pressure of market competition, urban beauty has provided consumers with a higher discount while cleaning up the stock. It is undeniable that the competitive pressure of urban beauty in the domestic underwear market is increasing, and the decline of performance seems to be the only way.

Of course, the city beauty announced a profit warning while announcing various measures to improve the current business predicament. It is worth mentioning that, recently, the city beauty official announced 95 after the small Hua Dan Guan Xiaotong as his brand spokesperson. During this period, Guan Xiaotong will take part in the brand advertising shooting and attend the brand promotion activities. The urban beauty is also expected to launch more new and high quality products from the second half of this year to meet the needs of consumers.

In the industry view, urban beauty wants to rely on Guan Xiaotong's fashion, vigor and youth image to achieve the purpose of brand fashion and youth. But in the eyes of consumers, will the image of urban beauty change? Chinese Commercial Daily reporter interviewed several female consumers randomly. They generally believe that the advantage of urban beauty lies in the positioning of the middle and low end, the price is relatively favorable, and the choice of goods is not very concerned about the endorsement.

It can be seen that whether the urban beauty who has changed the new spokesperson can optimize the brand image and seize the young market can be proved by time.

It is worth noting that the urban beauty will also appoint a new CEO in the apparel industry within a few months, leading and promoting the group's reform and strategic measures, and improving the execution and efficiency of the group. In terms of products, the company will increase its R & D efforts, introduce more new quality products in the market, and adopt appropriate pricing strategies to optimize gross margins.

Meanwhile, urban beauty says it will continue to seek opportunities for strategic investment in quality suppliers, enhance product quality, shorten production cycle and improve quick response capability, and will focus on purchasing orders to raise gross margins. City beauty also said that the future will explore opportunities to cooperate with international underwear companies, and jointly explore the domestic market.

In fact, from the self rescue measures released by urban beauty, it is very clear about its own problems, and in recent years, it is also undergoing continuous transformation. Last year, urban beauty opened up the electricity supplier channel, abandoning the traditional "integrated marketing" mode, and began to work hard in the aspects of electricity suppliers, storefronts, products and so on. At the same time, it strictly controls costs and saves costs. The improvement measures put forward by the urban beauty show that they develop brand portfolios in the new retail mode and expand the company's retail footprint, especially in shopping centers and e-commerce channels. According to the 2018 performance report, online sales of urban beauty online investment increased by 15.1% over the same period. It is worth mentioning that the urban beauty also signed a letter of intent last year with the secret former CEO and senior French designer in Vitoria, hoping to change the urban beauty's past too popular positioning and slightly old-fashioned design.

Guo Haiyan, an analyst with CICC, said that this year, urban beauty will pay more attention to the development of O+ brand, and the original product is expected to take a larger proportion in the product mix. In addition, the company will further integrate suppliers and distributors, but due to uncertainties in some macroeconomic factors, the company budget may still be tight this year.