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After Removing The "Zhi Ling" Hat, Urban Beauty Faces Billions Of Billions Of Dollars In Market Value.

2019/8/19 16:43:00 27

Urban BeautyUnderwear

02298.HK, once a leading brand of local underwear, is undergoing many tests.

Recently, urban beauty issued a profit warning that the company's expected profit in the first half of 2019 will fall by more than 80%. At the close of August 15, 2019, urban beauty received HK $1.32 / share, with a market value of HK $2 billion 969 million. 2015 is the peak year of urban beauty. In July 2015, the urban beauty reached HK $8.35 / share, and its market value exceeded 18 billion Hong Kong dollars. In four years, the market value of urban beauty evaporated 15 billion Hong Kong dollars, or about 13 billion 500 million yuan.

In the first half of 2018, the urban beauty report showed that the profit of the company's equity holders was 175 million yuan. According to the above warning, the net profit of urban beauty in the first half of 2019 was less than 35 million yuan. Urban beauty claims that the drop in profits is mainly due to the increase in the cost of raw materials and the provision of higher discounts to clean up the old stock of the group.

According to gf's statistics on market share of underwear market in 2015, urban beauty ranked first in 3.2% market share in 2015. Looking at the performance report at that time, "the urban beauty has increased by 23.6% to 4 billion 900 million yuan in 2015." "urban beauty realized a net profit of 540 million yuan in 2015, an increase of 27% over the same period last year".

   "Wan Dian" expansion -- the touchstone of the past

In fact, it is only five years since the city beauty landed on the Hong Kong stock market. Statistics show that the urban beauty was founded in 1998, and was listed on the main board of Hongkong in June 2014. It is known as "the first underwear in the mainland".

The beauty of the city appeared in 1988, filling the gap between the high-end underwear and the low-end brand in the domestic underwear market. At that time, the low-end underwear was mostly based on the stalls. The urban beauty gathered the stores in the stores by selling the category of personal clothing to the stores through the price of the people.

Unlike high-end lingerie brands stationed in KA stores, city beauty expands channels through chains and franchised stores. Since 2002, urban beauty has focused on two or three line cities. In 2014, it put forward the "Wan Dian plan". It plans to expand the urban beauty stores in the mainland market to 1 million in 5 years. In the past 2011-2015 years, the annual net profit of urban beauty has been increasing. It is reported that in 2015, there were 1032 retail outlets for urban beauty and 8000 over the shops. According to the insiders, the urban beauty is located in the low and middle market. On the one hand, the operation cost of the three or four line cities is low. On the other hand, when the underwear industry started to rise, the beauty of the city quickly came to the fore by virtue of the "Wan Dian" strategy.

The running beauty of the city met with the brakes in 2016. In 2016, the sales revenue of urban beauty dropped by about 8.9% to 4 billion 512 million yuan, and net profit dropped by about 55.2% to 242 million yuan. The net cash earned from operation was converted to 6 million 930 thousand yuan from the net flow of 403 million yuan in 2015. In the first half of 2016, the number of urban beauty shops was 238, and the total number of stores in 2017 dropped by 362. By the end of 2017, the distribution network of urban beauty included 7181 stores, 1290 of which were self owned stores and 5891 were franchised stores.

In 2018, Everbright Securities Research and analysis reported that the initial expansion strategy of urban beauty was too radical, the dealer combination and the lack of scientific management of location strategy worsened the quality of the channel, and the organization did not respond to the retail end change in time, and the internal lack of information sharing mechanism. Insiders have analyzed underwear is a business led by R & D and sales capabilities. Nowadays, when marketing methods become diversified, urban beauties still use the way of online advertising and underlaying channels, and the cost of raw materials, R & D and manufacturing costs continue to rise. The major lingerie brands are constantly rising. Urban beauty has not formed their own technical barriers, and the sales channels of online products have not been completely opened up.

Since then, urban beauty has begun a strategic transformation. It is reported that urban beauty has adjusted sales channels, including shutting down the loss stores, increasing the proportion of Direct stores, increasing the number of shopping centers and upgrading the image of stores. In the first half of 2018, the urban beauty also set up a merger fund with Jingdong, a joint venture with Shanghai's kappa, a strategic investor such as vip.com and Tencent, and a former CEO and Hua Yuan GoerTek research and development minister, Tang Qianteng.

The decline in performance was reversed in 2018. Urban beauty 2018 annual performance report shows that the annual income of urban beauty in 2018 was 5 billion 96 million yuan, an increase of 12.2% over the same period last year, and the operating profit was 483 million yuan, an increase of 15.4% over the same period last year.

The double increase of net profit margin is difficult to cover up the fact that gross profit margin keeps dropping. The gross profit margin of urban beauty dropped from 44.37% in 2016 to 41.67% in 2018. At the same time, accounts receivable increased from 451 million yuan in 2016 to 826 million yuan in 2018. Net cash income from operating activities rose sharply to 347 million yuan in 2017, and then dropped rapidly to 51 million yuan in 2018.

   After the city beauty replaced the spokesperson

In June 21st, the city beauty announced the new spokesperson, Guan Xiaotong, 22 years old "national daughter", and bid farewell to Zhi Ling elder sister, who had been working together for seven years. This is interpreted by the industry as the adjustment of the age of the urban beauty consumers.

Can the brand really be younger after taking off the hat of "elder sister"? A boss who runs an underwear shop in Jiaxing, Zhejiang, told reporters that at present, the demands of younger consumers for underwear are more comfortable, simple and individualized, and the categories of underwear are constantly broken down, such as those without steel rings, beautiful back, sports underwear and so on. The beauty of urban beauty is incomplete and the quality is one. It does not satisfy the needs of consumers. A person engaged in the promotion of underwear brand marketing is straight to the point, "comfort, adjustment, fit, identity, ritual, net red money, word of mouth, no steel ring" label, which is not touched by urban beauty.

As a matter of fact, the people in the industry mentioned this sentence on the popularity of underwear knowledge in the whole domestic market. In the eyes of the industry, domestic consumers lack scientific knowledge of underwear. "If most girls do not study deliberately, their cognition is basically derived from underwear shopping guide." Underwear salesmen are only salesmen, and most likely they do not have the knowledge of purchasing underwear professionally. The industry admitted that a larger cup of underwear, a small cup of underwear for fabric, craft requirements are lower, so the factory is more willing to produce small cup underwear. At the same time, early domestic underwear advertising vigorously publicized the effect of small cups, causing consumers to misunderstand their own characteristics. In fact, over gathering will cause oppression and deformation, and thick sponge will easily breed bacteria. The main hit of early urban beauty is the "thin, thick" gathering underwear.

In 2016, the performance of urban beauty fell sharply. The urban beauty explained that the demand for brassiere without ring and steel rim increased greatly. Micro traders could react quickly and seize this opportunity at the level of supply and marketing, while urban beauty was lack of technical suppliers who had no scar and no steel ring bra, and the supply of OEM suppliers was also affected by micro businesses, resulting in a serious lack of such products, which greatly affected them. Sale.

After the signing of the sexy girl Lin Chiling in 2012, the city beauty brand has a high reputation. Since then, the sexy label has also been following the beauty of the city. But in recent years, the urban beauty seems to be full of the "local flavor" wind between the urban and rural areas. The reporter asked a number of women over the age of five in a certain city in Anhui to understand the beauty of the city. Many of them said that the price was low, and it did not mean it to be in the middle of the city. "40" The above underwear brand promoters said: "mothers will not believe that a" sell to girls "brand has good results.

The underwear brand that sells to the little girl is liked by young people? Reporters asked nearly ten girls after 90, and more than half said their impression still stayed in junior high school. Some of the respondents said they would go to H&M, UNIQLO and other fast fashion shops to buy underwear. Because of their comfort and convenience, half of them said they would buy underwear in the electronic business platform, and comfort is the first choice. Ask.

According to the "underwear industry trend study" released by CBNData and Tmall underwear, the market of brassiere without steel ring broke out in 2017, and the market scale increased by nearly 50%. The study also subdivided the "girl crowd" who bought the girl's bra, the 18-25 year old "young crowd", the "full population" of the cup D+, and the "high-end crowd" who spend more than 500 yuan per year.

This is similar to the division of the above industry. She believes that bra consumers can be divided into three categories. The first category is the cognition of underwear from the consumers of offline shops and elders. The second category concerns the comfort and fabric, advocates the consumers who accept themselves. The third category belongs to geeks, and has the professional knowledge of choosing underwear. In her view, the first group of consumers to choose the beauty of urban probability is greater, second types of consumers will prefer the electronic business platform, network brand, and the first group is constantly changing to second groups, so the urban beauty of the inherent customers are constantly losing.

In addition to Guan Xuan's new spokesperson, in June 2019, the city beauty announced that it had entered into sixteen joint venture cooperation agreements with its respective controlling shareholders of the sixteen existing suppliers of the group, and established a joint venture company to carry out business cooperation activities, so as to integrate the new product and new material development ability of suppliers, and shorten the development and production cycle of new materials and new products.

In the view of the industry, the brand's perception of oneself and consumers' cognition of brand may be very different. Therefore, brand upgrading or transformation must first identify their location and conduct adequate user research, including buying habits, psychological prices, channels for receiving information, requirements for underwear, and so on, followed by differences between their brands and other brands. Analyze whether the difference exists in the market, then enlarge the difference, and finally upgrade the product line and marketing method.

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