City Beauty Refutes Rumors, Denies 90% Of Store Closures And Will "Start A Second Business"

Recently, about the city beauty closed 90% of the store rumors, the city beauty carried out a rumor. Since the middle of last year, more than 80% of the city group's stores have resumed business since March 2020.

The simultaneous renovation project of seven generation stores has covered more than 110 stores in China. Currently, more than 200 stores are being renovated, and the progress of opening stores and market expansion is also advancing. Nearly 100 stores will be opened in May and June.

Although the rumors about the closure are not true, the beauty of the city is still facing challenges. "In the past period of time, we went the wrong way, we took the route of sexuality and fashion," Zheng said The result is that the product positioning and consumer perception of the dislocation, resulting in a large number of inventory backlog.

According to the 2019 annual performance report released by metropolitan beauty, in 2019, the group's revenue decreased by about 19.9% to about 4.082 billion yuan year-on-year; the loss attributable to shareholders was 1.298 billion yuan, a year-on-year decrease of 443.13%; the gross profit rate also dropped sharply from 41.7% in 2018 to 22.6%, which was the worst performance of the company since its listing in 2014.

It can be seen that the performance of urban beauties before is not optimistic. Recently, Zheng Yaonan, chairman of urban beauty, said in an interview that in response to the pain of transformation and the market situation, we must promote reform with the determination of "starting a second business".

The company's product positioning will return from "sexy fast fashion" to "practical brand" which emphasizes practicability, functionality and cost performance. In order to reduce invalid categories and product lines, the product line will be reduced by 40%, and efforts will be focused on creating evergreen and popular models. Two major products of "light" and "warm" will be launched in July this year.

After the outbreak of the epidemic, the e-commerce channels of urban beauty grew rapidly, and its main e-commerce sales platform increased by more than 30% in May and June after the outbreak. Today, the company's tmall flagship store has 4.06 million fans, and its direct stores and franchise stores have rapidly resumed sales growth through e-commerce platforms and small programs.

However, Zheng Yaonan believes that underwear is a special category in the clothing industry, "underwear should be tried on, with higher requirements for wearing experience. The proportion of e-commerce in underwear industry is not large, and the impact of e-commerce is limited. Live broadcasting and e-commerce are just a supplement to our channel. " In this regard, the city beauty still want to add offline stores.

Xiao Jiale, CEO of urban beauty, said, "we see that there is a big space for the market of intimate clothing in China". With the growth of consumer demand for intimate clothing, China's intimate clothing market is expanding.

In addition, Xiao Jiale said, "in China, the market share of the top five leading enterprises in the underwear industry is far from over 50%". Although there are many brands in China's personal clothing industry, they are extremely scattered. According to this, Xiao Jiale has a larger space for development.

According to the data, the market concentration of the top five brands in China's underwear market was only 6.6%, while that of the top five brands in Japan, the United States and the United Kingdom was 56%, 47% and 22% respectively in the same period. China's underwear market still has the potential to concentrate its market share to the top brands.

Although the city beauty is still in trouble, she has seen signs of rebirth. I believe that the city beauty can explore a suitable way for its development with the passage of time, and flourish and shine.