As with other apparel and footwear industries, high inventory has become the "Sword of Damocles" in the women's footwear industry.
In the recent past, the results of the 2011 performance reports released by domestic women's shoe companies such as Saturday, Belle International and Daphne have shown that the company's inventory has increased significantly, and some companies have even increased their inventories by nearly 100%.
In order to ease this pressure, shoe companies are "walking the wires" between opening and closing stores, while they are working hard on internal control and marketing. Shoes companies including Belle also intend to increase the development of e-commerce channels. However, it is still difficult to say whether the effect of these methods to achieve inventory is satisfactory.
“The current high inventory in the industry is due to the lack of sufficient brand appeal of women's shoes enterprises and blindness in opening up stores, resulting in excess capacity.†Zhu Qingyu, a light industry researcher with CIC Advisors, told reporters that a reasonable speed can be established only when the brand and quality are good. In order to solve the problem of increasing corporate inventories and falling profits, we can solve the problem inherently.
High inventory In 2011, the revenue for the week was 1.348 billion yuan, up 17.9% year-on-year, but the net profit attributable to the shareholders of the listed company decreased by 0.85% to RMB 99 million. In addition, net inventory increased by 39.43% to 799 million yuan, accounting for 42.51% of the one-year period and 27.45% of the one-year period. The inventory turnover days of the year reached 353 days, an increase of 43 days from 2010.
Belle's 2011 results also showed that the ending inventory amount increased by 34.1% from the end of last year, from 4.859 billion yuan to 6.517 billion yuan. Daphne’s inventory rose from HK$1,084 million to HK$2,059 million.
Belle said in the announcement that the inventory was too high because the Spring Festival in 2012 was 10 days ahead of 2011, and the sales season was advanced. The company had to stock up in advance, so the inventory amount reached a relatively high point at the end of December last year. In addition, sales growth of the company slowed down in the fourth quarter of last year, and same-store sales were lower than previously expected.
"In order to expand sales channels and increase performance, women's shoe companies have expanded their stores on a large scale, leading to an increase in inventories," said Zhu Qingxi. However, if stores do not see a trend of improvement after one or two years of opening, companies will choose to close some inefficiencies. Stores, and the fierce competition in the store's switch and women's shoes markets have all increased the stock of women's shoe companies.
The data also shows that Daphne expanded its sales network to 6,165 retail stores last year, an increase of 966 from 5,199 retail stores in the same period last year. Wang Fenghua, a researcher at Hongyuan Securities, also pointed out that about 300 new stores were opened on Saturdays in 2011, but some old stores had poor results and closed more than 100 stores. In other words, every time you open three new stores, at least one old store will be closed on Saturdays, and the effect of opening a store operation does not meet expectations.
Destocking Today, going for inventory has become an even more important issue for shoe companies this year.
Reporters visited a number of shopping malls in Guangzhou and found that the discount rate for women's shoes this year is much higher than last year, and some brands also expanded the range of categories participating in shopping mall activities. Discounts, promotions, sales, and other means are the most direct way for many shoe companies to choose inventory options.
"In the past, shoe companies generally held only two spring and autumn orders, but now some companies do it every quarter." Guangbaiyi footwear brand counter person in charge told this newspaper, not only that, the company's direct sales stores also started various promotions Activities to directly reduce store inventory.
The development of retail channels is still a way for shoe companies to attack stocks. In addition to traditional store sales, many shoe companies, including Belle, are also preparing to increase their investment in e-commerce channels. Many companies have also slowed the pace of store expansion. For example, Daphne’s plan is to open about 700 new stores this year, but this scale is lower than the actual number of net additions last year.
"These measures can reduce inventory to a certain extent, but the effect may not be obvious." Zhu Qingyun said that in 2006, the total consumption of the Chinese women's branded brands market was 6 billion pairs, and the total market consumption reached 210 billion yuan, then 12 per year. The speed of % rises rapidly. In 2010, the total consumption of women's shoes exceeded 8 billion pairs, and its total market reached 300 billion yuan. This shows that China's women's shoes market has a very large market space and development prospects. Enterprises should spend more time and energy in understanding customer needs and improving product quality.
In the recent past, the results of the 2011 performance reports released by domestic women's shoe companies such as Saturday, Belle International and Daphne have shown that the company's inventory has increased significantly, and some companies have even increased their inventories by nearly 100%.
In order to ease this pressure, shoe companies are "walking the wires" between opening and closing stores, while they are working hard on internal control and marketing. Shoes companies including Belle also intend to increase the development of e-commerce channels. However, it is still difficult to say whether the effect of these methods to achieve inventory is satisfactory.
“The current high inventory in the industry is due to the lack of sufficient brand appeal of women's shoes enterprises and blindness in opening up stores, resulting in excess capacity.†Zhu Qingyu, a light industry researcher with CIC Advisors, told reporters that a reasonable speed can be established only when the brand and quality are good. In order to solve the problem of increasing corporate inventories and falling profits, we can solve the problem inherently.
High inventory In 2011, the revenue for the week was 1.348 billion yuan, up 17.9% year-on-year, but the net profit attributable to the shareholders of the listed company decreased by 0.85% to RMB 99 million. In addition, net inventory increased by 39.43% to 799 million yuan, accounting for 42.51% of the one-year period and 27.45% of the one-year period. The inventory turnover days of the year reached 353 days, an increase of 43 days from 2010.
Belle's 2011 results also showed that the ending inventory amount increased by 34.1% from the end of last year, from 4.859 billion yuan to 6.517 billion yuan. Daphne’s inventory rose from HK$1,084 million to HK$2,059 million.
Belle said in the announcement that the inventory was too high because the Spring Festival in 2012 was 10 days ahead of 2011, and the sales season was advanced. The company had to stock up in advance, so the inventory amount reached a relatively high point at the end of December last year. In addition, sales growth of the company slowed down in the fourth quarter of last year, and same-store sales were lower than previously expected.
"In order to expand sales channels and increase performance, women's shoe companies have expanded their stores on a large scale, leading to an increase in inventories," said Zhu Qingxi. However, if stores do not see a trend of improvement after one or two years of opening, companies will choose to close some inefficiencies. Stores, and the fierce competition in the store's switch and women's shoes markets have all increased the stock of women's shoe companies.
The data also shows that Daphne expanded its sales network to 6,165 retail stores last year, an increase of 966 from 5,199 retail stores in the same period last year. Wang Fenghua, a researcher at Hongyuan Securities, also pointed out that about 300 new stores were opened on Saturdays in 2011, but some old stores had poor results and closed more than 100 stores. In other words, every time you open three new stores, at least one old store will be closed on Saturdays, and the effect of opening a store operation does not meet expectations.
Destocking Today, going for inventory has become an even more important issue for shoe companies this year.
Reporters visited a number of shopping malls in Guangzhou and found that the discount rate for women's shoes this year is much higher than last year, and some brands also expanded the range of categories participating in shopping mall activities. Discounts, promotions, sales, and other means are the most direct way for many shoe companies to choose inventory options.
"In the past, shoe companies generally held only two spring and autumn orders, but now some companies do it every quarter." Guangbaiyi footwear brand counter person in charge told this newspaper, not only that, the company's direct sales stores also started various promotions Activities to directly reduce store inventory.
The development of retail channels is still a way for shoe companies to attack stocks. In addition to traditional store sales, many shoe companies, including Belle, are also preparing to increase their investment in e-commerce channels. Many companies have also slowed the pace of store expansion. For example, Daphne’s plan is to open about 700 new stores this year, but this scale is lower than the actual number of net additions last year.
"These measures can reduce inventory to a certain extent, but the effect may not be obvious." Zhu Qingyun said that in 2006, the total consumption of the Chinese women's branded brands market was 6 billion pairs, and the total market consumption reached 210 billion yuan, then 12 per year. The speed of % rises rapidly. In 2010, the total consumption of women's shoes exceeded 8 billion pairs, and its total market reached 300 billion yuan. This shows that China's women's shoes market has a very large market space and development prospects. Enterprises should spend more time and energy in understanding customer needs and improving product quality.
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