Smithsonian Inventory Digestion Turns Strategy Transformation into New Impetus

Recently, after the adjustment of Meibang Apparel, which suffered a high inventory crisis, costs have risen and market competition has intensified. Under pressure from the industry, Meibang Apparel has produced brilliant results.

Strong anti-risk ability

As for the pressures faced, the company pointed out in the annual report that from the perspective of the apparel industry, on the one hand, the labor costs continue to rise, the prices of major raw materials fluctuated at high levels, and production costs increased. On the other hand, international competition brands rapidly expanded and began to spread to the second and third lines. Market penetration. The company is affected by unfavorable factors such as rising operating costs, intensifying competitive pressures, large inventory sizes, and abnormal seasonal climate.

Insiders pointed out that under a lot of pressure, the performance of Meibang apparel has increased by nearly 60%, showing strong resistance to risks. According to the annual report, there were 1,134 new stores in Maynbang Apparel in 2011, an increase of 31%. In terms of direct operations and franchising, the proportion of revenue from direct operations increased from 38% to 43%. The new direct-operated stores are mostly small- and medium-sized shops and children's wear shops. The previous strategy of large-scale direct stores has changed.

Zhou Sili, a professional analyst, pointed out that the company clearly defined the direction of brand upgrade, balanced development of endogenous growth and outreach expansion. With regard to endogenous growth, the company achieved product docking with stores, increased spot ratios and replenishment, and promoted the transition from "pushing" to "pulling" in the supply chain model; expanded in terms of extension, multi-brand and multi-series expansion, and channel expansion. Refined, focusing on the future mainstream industries such as shopping malls, high-end communities and dense office areas, and deepening brand upgrades. The deepening of the company's strategic transformation will be expected to form a new driving force for growth.

Institutional bargaining

In the fourth quarter of 2011, there was a large drop in Smith Barney's clothing. It has been optimistic that a number of institutions in the stock have not only failed to sell, but have actively bought on dips when stock prices have fallen. The annual report of the shareholders shows that Huaan Strategy Optimum Fund has substantially increased 467 million shares, and continues to stabilize the institutional leader.

In addition, the funds invested in Morgan Stanley Domestic Demand, Han Hing Securities Fund, and Taishin Advanced Strategy have appeared in different degrees. It can be seen that with the obvious adjustment of the stock price, the number of shares held by institutional investors has increased, and the willingness of the main funds to buy on the bargain is stronger.

Another expert, Guo Haiyan, believes that the problem of inventory of Smith Barney is gradually improving, but the industry competition of young casual wear industry is becoming increasingly fierce. High-end markets in Tier 1 and Tier 2 cities are impacted by international fashion brands that have accelerated their entry into the Chinese market. Low-end markets have been hit by online shopping and lower-priced regional brands, placing higher demands on Smithsonian’s product design, supply chain management and rapid response capabilities. The request.