With the development of economy, the upgrading of domestic consumption continues to advance, and apparel products have also become a vital force that can not be ignored in the expansion of domestic demand. At present, domestic consumption has entered the era of diversification, and its trend towards high-end upgrades is clear. With the growth of middle- and high-level consumer groups, luxury goods and high-end clothing brands will provide long-term and sustained market demand. From the perspective of price, the target consumer groups are less sensitive to price and can enjoy the marginal advantages brought by continuous price increase; from the perspective of demand, high-end consumer groups are stable, and there are also a steady stream of new individual individuals joining.
“This year is the first year of the Twelfth Five-Year Plan, and the 'Twelfth Five-Year Plan' is a very important period for transforming the mode of economic development. An important part of transforming the mode of economic development is expanding domestic demand, especially expanding consumption of residents. It means that the expansion of consumption will become the main driving force for domestic economic growth in the future, and therefore, the domestic demand concept stock that has the ability to price under the trend of rising prices or the ability to transfer cost pressures may become the theme of investment in the A-share market. The industries that have the ability to raise prices or whose product prices have far exceeded the cost will benefit greatly from this. In this respect, the consumer segment represented by food and beverages, clothing, luxury goods, and retail sales is a typical representative. The cost can be transferred to consumers, and it can increase the price increase rate, from the terminal to extract higher profits." Ping Yan Securities analyst Li Yan said.
The above is a positive view of the apparel sector in the stock market. Whether this advantage has also become a background factor in the rising price of sports brands? In the announcement of the price increase announcement, the first person to raise the price tag was Li Ning, which also led to a new round of “ups†for sportswear brands.
Sportswear, rising tone According to the announcement issued by Li Ning Company recently, the price of footwear products will increase by 7.8% in the fourth quarter, and apparel will rise by 17.9%. Previously, Anta, Xtep, Peak and 361 Degrees also announced the news of rising prices. . And the increase was as high as 10%. Sports shoes and clothing of the top five well-known sports brands in China will once again increase their prices by one to two percent.
Li Ning news spokesman said: "The main reason for this price increase is the combined effect of raw materials, manpower, and store rental, and the price increase is also an industry trend."
Regarding the collective price increase of domestic brands in this round, Xiong Xiaokun, a light industry researcher with CIC Advisors, believes that the current level of consumer spending will gradually increase from the low to the medium, given the backdrop of rising prices, store rental costs, and labor costs. In the high-end transition, price adjustment is also a choice that companies have to make.
In the past two years, many sportswear brands in China have surpassed international brands such as Nike and Adidas, indicating that the distance between some well-known sports brands and international brands is shrinking. "For brands with price ranges between $200 and $300, frequent price increases may be at risk of losing consumers," Xiong Xiaokun said.
For the collective price increase of local sports brands, the interpretation of these companies is generally the same. According to the data of the Xtep semi-annual report, the staff cost increased from RMB 81.318 million in the same period of last year to RMB 95.345 million, which represented a year-on-year increase of 17.2%; the cost of raw material sales was RMB 537 million, which represented a year-on-year increase of 18.7%. An insider of a foreign-owned sports brand told the reporter: “Fabric price prices have increased significantly, especially since some imported fabrics have risen by more than 30%, and factory workers’ wages have just risen, otherwise it is difficult for skilled workers to recruit.â€
In addition, the expenditure on publicity and promotion has also grown by a small margin. Taking Anta as an example, advertising and promotion expenses accounted for 12.0% of operating revenue in the first half of this year, an increase of 0.8% compared with the same period of last year. However, not all sporting goods companies increase their prices because of increased costs. Prior to this, relevant persons of Li Ning Company stated that the price increase was mainly to increase the brand positioning and to narrow the distance between the brands of transnational sports.
The price increases, the benefits outweigh the disadvantages?
Will prices for sports apparel be transmitted to the entire industry? According to industry sources, the current retail price of branded clothing has generally risen by 10% to 15%. Industry insiders expect that the wholesale price of apparel products will increase by 10% to 15% this fall and winter. Repeated price increases have dampened market sales to some extent. Taking Li Ning as an example, the increase in the price of apparel and footwear products in the second quarter of this year decreased by more than 7% and 8%, respectively.
For the market acceptance of product price increases, sports brand analyst Xu Yunfeng believes that the reason for rising costs is too pale for consumers. If companies increase prices, they must add value to their products. Otherwise, the price increase will only lose more consumers, especially for the local low-end brands. The consumer groups of foreign brands may not be too sensitive to price, but low-end brands may choose other products for a price increase consumer group.
“Fashion apparel is not necessarily purchased every day like food. If the price goes up, buy less, or look online.†This is the true idea of ​​many consumers. Today, some shopping malls that do not have activities are obviously scarce. Although some counter sales staff are unwilling to disclose specific figures, their expressions of helplessness and confession of “more hard-selling sales†indicate the difficulty of increasing sales now.
Ma Gang, a well-known sports brand observer, believes that the new round of price increases will only harm more than profits. The reason is that many of the domestic sports brands targeted at the consumer population are middle and low class, and this part of the population is more sensitive to price increases and decreases. At the same time when the domestic brands raised their prices, they also made some markets in the middle and low. The result of price increases will undoubtedly increase the difficulty of marketing.
Recently, Adidas announced its first-half results. Greater China sales amounted to 552 million euros, a 37% year-on-year increase compared to 403 million euros in the same period of last year. Excluding exchange rate factors, it increased by 38% year-on-year, and ranked first in the Adidas sixth market. Adidas's performance from the negative growth in 2009 to the current performance of the "blowout", for Li Ning companies are suffering from inventory, etc., erected a Jedi counterattack "benchmark." Judging from the current situation, Adidas handled inventories in 2009 and 2010, emptied the backlog of sales channels, and optimized sales channels. This was the right decision. In the first half of 2010, Adidas resumed growth in the Chinese market. In the second quarter of this year, sales increased by 41% year-on-year.
The above data shows that most domestically-made sports brands that do not have a good reputation need to recognize the target groups they target. They cannot easily follow the trend of price increase, and must do a good job of “guaranteeing quality and insured prices†to stabilize their customer base. Local brands should be cautious in responding to price adjustments, and they should not “rise as I riseâ€. When it is really necessary to adjust prices, there must be a clear price gradient for price adjustment time, price adjustment scope, and price adjustment area to reduce the loss of consumers.
Adidas's case hopes to give some inspiration to domestic brands. The current upward pressure on prices is high. In the era of “anti-inflation†for all people, responsible companies should explore other channels to absorb costs in addition to price increases.
“This year is the first year of the Twelfth Five-Year Plan, and the 'Twelfth Five-Year Plan' is a very important period for transforming the mode of economic development. An important part of transforming the mode of economic development is expanding domestic demand, especially expanding consumption of residents. It means that the expansion of consumption will become the main driving force for domestic economic growth in the future, and therefore, the domestic demand concept stock that has the ability to price under the trend of rising prices or the ability to transfer cost pressures may become the theme of investment in the A-share market. The industries that have the ability to raise prices or whose product prices have far exceeded the cost will benefit greatly from this. In this respect, the consumer segment represented by food and beverages, clothing, luxury goods, and retail sales is a typical representative. The cost can be transferred to consumers, and it can increase the price increase rate, from the terminal to extract higher profits." Ping Yan Securities analyst Li Yan said.
The above is a positive view of the apparel sector in the stock market. Whether this advantage has also become a background factor in the rising price of sports brands? In the announcement of the price increase announcement, the first person to raise the price tag was Li Ning, which also led to a new round of “ups†for sportswear brands.
Sportswear, rising tone According to the announcement issued by Li Ning Company recently, the price of footwear products will increase by 7.8% in the fourth quarter, and apparel will rise by 17.9%. Previously, Anta, Xtep, Peak and 361 Degrees also announced the news of rising prices. . And the increase was as high as 10%. Sports shoes and clothing of the top five well-known sports brands in China will once again increase their prices by one to two percent.
Li Ning news spokesman said: "The main reason for this price increase is the combined effect of raw materials, manpower, and store rental, and the price increase is also an industry trend."
Regarding the collective price increase of domestic brands in this round, Xiong Xiaokun, a light industry researcher with CIC Advisors, believes that the current level of consumer spending will gradually increase from the low to the medium, given the backdrop of rising prices, store rental costs, and labor costs. In the high-end transition, price adjustment is also a choice that companies have to make.
In the past two years, many sportswear brands in China have surpassed international brands such as Nike and Adidas, indicating that the distance between some well-known sports brands and international brands is shrinking. "For brands with price ranges between $200 and $300, frequent price increases may be at risk of losing consumers," Xiong Xiaokun said.
For the collective price increase of local sports brands, the interpretation of these companies is generally the same. According to the data of the Xtep semi-annual report, the staff cost increased from RMB 81.318 million in the same period of last year to RMB 95.345 million, which represented a year-on-year increase of 17.2%; the cost of raw material sales was RMB 537 million, which represented a year-on-year increase of 18.7%. An insider of a foreign-owned sports brand told the reporter: “Fabric price prices have increased significantly, especially since some imported fabrics have risen by more than 30%, and factory workers’ wages have just risen, otherwise it is difficult for skilled workers to recruit.â€
In addition, the expenditure on publicity and promotion has also grown by a small margin. Taking Anta as an example, advertising and promotion expenses accounted for 12.0% of operating revenue in the first half of this year, an increase of 0.8% compared with the same period of last year. However, not all sporting goods companies increase their prices because of increased costs. Prior to this, relevant persons of Li Ning Company stated that the price increase was mainly to increase the brand positioning and to narrow the distance between the brands of transnational sports.
The price increases, the benefits outweigh the disadvantages?
Will prices for sports apparel be transmitted to the entire industry? According to industry sources, the current retail price of branded clothing has generally risen by 10% to 15%. Industry insiders expect that the wholesale price of apparel products will increase by 10% to 15% this fall and winter. Repeated price increases have dampened market sales to some extent. Taking Li Ning as an example, the increase in the price of apparel and footwear products in the second quarter of this year decreased by more than 7% and 8%, respectively.
For the market acceptance of product price increases, sports brand analyst Xu Yunfeng believes that the reason for rising costs is too pale for consumers. If companies increase prices, they must add value to their products. Otherwise, the price increase will only lose more consumers, especially for the local low-end brands. The consumer groups of foreign brands may not be too sensitive to price, but low-end brands may choose other products for a price increase consumer group.
“Fashion apparel is not necessarily purchased every day like food. If the price goes up, buy less, or look online.†This is the true idea of ​​many consumers. Today, some shopping malls that do not have activities are obviously scarce. Although some counter sales staff are unwilling to disclose specific figures, their expressions of helplessness and confession of “more hard-selling sales†indicate the difficulty of increasing sales now.
Ma Gang, a well-known sports brand observer, believes that the new round of price increases will only harm more than profits. The reason is that many of the domestic sports brands targeted at the consumer population are middle and low class, and this part of the population is more sensitive to price increases and decreases. At the same time when the domestic brands raised their prices, they also made some markets in the middle and low. The result of price increases will undoubtedly increase the difficulty of marketing.
Recently, Adidas announced its first-half results. Greater China sales amounted to 552 million euros, a 37% year-on-year increase compared to 403 million euros in the same period of last year. Excluding exchange rate factors, it increased by 38% year-on-year, and ranked first in the Adidas sixth market. Adidas's performance from the negative growth in 2009 to the current performance of the "blowout", for Li Ning companies are suffering from inventory, etc., erected a Jedi counterattack "benchmark." Judging from the current situation, Adidas handled inventories in 2009 and 2010, emptied the backlog of sales channels, and optimized sales channels. This was the right decision. In the first half of 2010, Adidas resumed growth in the Chinese market. In the second quarter of this year, sales increased by 41% year-on-year.
The above data shows that most domestically-made sports brands that do not have a good reputation need to recognize the target groups they target. They cannot easily follow the trend of price increase, and must do a good job of “guaranteeing quality and insured prices†to stabilize their customer base. Local brands should be cautious in responding to price adjustments, and they should not “rise as I riseâ€. When it is really necessary to adjust prices, there must be a clear price gradient for price adjustment time, price adjustment scope, and price adjustment area to reduce the loss of consumers.
Adidas's case hopes to give some inspiration to domestic brands. The current upward pressure on prices is high. In the era of “anti-inflation†for all people, responsible companies should explore other channels to absorb costs in addition to price increases.
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