To Be A World-Class Underwear Enterprise, How Much Is The Beauty Of The City?

On February, 90% of the stores in the city were closed due to the hot topic of "China's underwear". On the same day, the city beauty stock price rose straight, closing up 31%.

On July 3, the city beauty replied on the public account, saying that during the epidemic period, the company and its franchisees temporarily closed about 90% of its stores from February to mid March, and has gradually reopened its stores. As of May, nearly 6000 stores directly operated and joined by the company have basically recovered, and the sales volume has reached more than 80% in the same period of last year. It is expected that the overall performance of the company will continue to improve in June and the second half of the year.

From the listing in 2014 to the bankruptcy doubt, how many% of the once "underwear first share" will return to its peak?

The beauty of the city

In 1998, Zheng Yaonan, a Fujian businessman, founded the city beauty. He abandoned the traditional underwear sales model, trying to adopt a new mode of "one-stop shopping" to create a Chinese version of "Victoria's Secret".

With a complete range of categories and ultra-high cost performance, the advantages of urban beauty in the industry gradually appear. Therefore, in 2014, Zheng Yaonan put forward a more radical "WanDian plan" - the open franchise policy, expanding 10000 stores in five years. In June of the same year, the city beauty was listed in Hong Kong successfully, and with an annual revenue of 4 billion yuan, she became the first share of underwear in the mainland.

After the implementation of the "WanDian plan" in 2015, urban beauties blossomed all over the country overnight. The total number of stores once reached 8058, including 6937 franchise stores and 1121 self operated stores.

In 2016, Lida had the highest market share of urban underwear, accounting for 4% of the domestic market.

In the same year, for the first time, the revenue and profits of urban beauty fell to 4.5 billion yuan, a year-on-year decrease of 8.99%, and the profit dropped by 55.19% to 242 million yuan.

One of the main reasons for the sharp decline in the performance is that the demand for rimless underwear has increased greatly in the short term. However, the lack of suppliers who have the technology to produce traceless and rimless brassiere in the city. In addition, the product supply of the agent industry and commerce is also affected by micro businesses, resulting in a serious lack of such products, which greatly affects sales.

In the second half of 2019, "national underwear" urban beauty has officially lost the heart of women. On December 24, 2019, metropolitan beauty closed at HK $1.01, with a total market value of HK $2.27 billion.

In the first half of 2020, Lijiang City will make a loss of RMB 2.6 billion.

What's the difference between a windward turn and a turn?

The rapid expansion of franchise stores and the continuous decline in revenue are the two major problems that urban beauty faces in recent years.

In terms of franchise stores, urban beauty became China's largest underwear retailer in 2014. At that time, the city beauty had a total of 7026 stores, including 6049 franchise stores.

The franchise store is usually a sharp weapon for the rapid development of chain operation, and is the main force contributing to the huge sales volume for the beauty of the city. According to the interim report of urban beauty in 2019, the sales channel revenue of franchisees accounts for 48.9% of the total revenue.

However, the management of franchise stores has always been the biggest hidden danger of enterprises. The service quality and inventory turnover rate of stores will directly affect the experience of consumers.

"The shopping guide service is uneven, the product is completely unknown, the size depends on visual inspection, and there are endless discounts throughout the year..." These are the comments of netizens on the offline stores of urban beauty.

Since 2015, urban beauty began to "slim down" project, so far nearly 2000 stores have been reduced. By the end of 2019, the number of retail outlets of Li Du Bao was 62, which was lower than that in the first half of 2019, respectively. At the same time, Cosmo lady, a high-end brand, has been established in the middle and high-end shopping centers in the first and second tier cities.

In terms of revenue, according to the financial report of 2019 released by urban beauty, during the reporting period, the income of urban beauty was 4.082 billion yuan, a year-on-year decrease of nearly 20%; a loss of 1.298 billion yuan, a year-on-year decrease of 443.4%, a new low since its listing in 2014.

In 2018, Sharen Jester Turney, the former CEO of Weimi, was appointed as the group's Chief Strategic Officer, mainly responsible for the strategic planning and implementation of urban beauty, brand image promotion, introduction of designers, overseas M & A projects and retail operations.

"Consumers are more driven by price when they travel to cities. In the future, we need to combine fashion elements and sell products without discount," said saranten

In order to meet the market trend, urban beauty upgraded its products and subdivided the product styles according to the consumers' living conditions, and put forward the concept of "4f" -- free (simple and natural), Flint (temptation), function (playfulness) and function (functionalism).

In June 2019, the city beauty changed its image spokesperson from Lin Zhiling to Guan Xiaotong, the "national daughter", injecting new vitality into the brand. Zheng Yaonan, chairman of urban beauty, said: "in the past period of time, we have gone a wrong way, taking the route of sex appeal and fashion."

"Young, fashionable and approachable" is the new positioning of urban beauty.

Underwear "return to nature"

In recent years, it is not only the urban beauty who has suffered from the cold winter of the market, but also its industry benchmark, the sexy ancestor "Victoria's Secret", is no longer popular. In November 2019, Vimy announced the cancellation of the Vimy show, officially ending the 24-year fashion symbol.

This is not the beginning of the decline of Vimy. In recent years, Vimy has been involved in negative public opinions such as sexual harassment, hidden rules, materialized women, body humiliation and so on.

In February this year, sycamore partners, a US private equity fund, reached an agreement with L brands Inc., the parent company of Vimy, to acquire 55% of Weimi for us $525 million. In April, sycamore announced that it would give up the equity transaction, because the new crown epidemic had caused Weimi to close its stores on a large scale, take leave for employees, and cut salaries for senior executives, which damaged the brand value. On June 12, the company announced bankruptcy and liquidation, and all 25 stores were closed.

I don't want to wear underwear more and more I don't know if the city beauty and Wei Mi have figured it out

"Understanding women's heart" is the primary survival rule of underwear brands. However, the two underwear brands led by men have different understanding of women.

With the awakening of women's rights consciousness, the change of aesthetic concept and the promotion of economic status, "sexy charm", "big is beauty" and other male dominated needs are gradually replaced, and women's requirements for underwear return to the most basic demand of "comfort and simplicity".

Cbndata released "underwear industry trend research" shows that in the past three years, the sales volume of underwear without steel rims has increased rapidly, and the post-85, post-90 and post-95 are the main consumer groups, especially the sales volume after 95 shows exponential growth.

However, Vimy still regards women's body as the object to please men, and limits the positioning of underwear to "sexy temptation", which leads to thousands of signatures against advertisements with the slogan of "perfect body".

Urban beauties also ignore the emotional changes of women's sexuality and body after remodeling. In 2016, the sales volume of "Iwai" underwear has just reached 150 million, and there is no steel circle in 2016. But the beauty of the city is not aware of this, missed the opportunity to start a new business.

In the spring and summer 2020 blockbuster "no body is nobody", the record of the real body and the acceptance of the beauty of diversity have also won the praise of many new generations of consumers inside and outside Neiwai.

In 2019, sloggi and hunkemller, the 100 year old underwear brand of the Netherlands, both settled in China. Fast fashion brands such as UNIQLO, Zara, sports brands such as Nike and lululemon have also developed underwear product lines.

Established in 2017, berry Mellon, a technology fashion underwear brand, will measure 25 items of data of customers who enter the store for the first time, determine the chest shape, size and type of underwear suitable for wearing, and provide users with one-stop underwear solution by combining online matching algorithm with offline service.

Many emerging brands have unique experience in fabric R & D and product design, and have customized brand routes of intelligence, comfort, high-end, fine differentiation and personalization. However, many traditional enterprises, including urban beauty, tend to outsource production, design and logistics directly, and only produce a small number of samples independently for brand packaging and sales, resulting in single category, outdated style and poor user consumption experience.

The domestic women's underwear market has a huge scale and is expected to reach 200 billion yuan in 2022, with huge room for improvement. The market structure is still relatively scattered and the concentration is very low. The market share of the top ten brands is only 12%.

At present, the market value of urban beauty is only 1.237 billion Hong Kong dollars, with a short-term evaporation of nearly 19 billion. "To be a world-class underwear enterprise", Zheng Yaonan, the founder of this city beauty, has talked about countless times about his dream, which now seems far away.