Sports brands borrow children's wear to find new profit growth points

Recently, many adult sportswear companies have advanced into the children's wear industry. According to reports, 361° children's clothing stores in China currently sell 1,400 stores. This figure is expected to become 2,000 next year, reach 3,000 in 2015, and gradually expand into third and fourth tier cities. While the growth rate of adult shoes and clothing slowed down, children's wear showed a better growth trend. Barabara’s revenue growth in 2011 even surpassed its mother brand “Summa” casual wear.

In 2012, as the domestic adult sports goods industry gradually entered the adjustment period, the children's clothing market, which is in a period of rapid development, has become the focus of attention of major companies in the industry. In early May, Li Ning Group announced that it will enter the field of children's clothing with a brand new management team and a brand new brand logo, and announced the development plan for Li Ning's children's wear for the next 5 to 10 years.

High-profile advance into the field of children's clothing, has aroused widespread speculation in the industry: Li Ning, which is in the period of decline in performance, whether he wants to use the children's clothing business to get out of trouble and find new profit growth points?

Children's wear has become a new area of ​​expansion. In fact, it is not just Li Ning who has stepped up efforts to expand the children's clothing business this year. On April 27th, 361° Children’s Wear signed a strategic cooperation agreement with CCTV Children’s Channel, signaling a further expansion of the children’s market.

361° is not a new face in the field of children's wear. Since its launch in 2009, 361° has indicated that it plans to use 9% of the HK$2 billion ** for children's clothing research and development. In February 2010, after officially entering the field of children's wear, the goal of the 361° Children's Wear Division was to achieve an annual sales income of 200 million yuan in five years. However, the subsequent market development exceeded expectations. In 2011, the sales revenue of children's clothing has reached 400 million yuan.

According to reports, 361° children's clothing stores in China currently sell 1,400 stores. This figure is expected to become 2,000 next year, reach 3,000 in 2015, and gradually expand into third and fourth tier cities.

In 2008, as the first sports brand to enter the children's market in China, Anta quietly speeded up the speed of opening children's clothing. According to public data, the number of Anta children's clothing stores in 2009 and 2010 was 228 and 383 respectively, but in 2011, Anta children's clothing stores increased by 249 to 632, far exceeding the number of 500 children's stores planned at the beginning of the year. At the same time, it is reported that the entry threshold of Anta children's clothing store has also been reduced.

After experiencing a wait-and-see period for the children's wear market, Xtep also released news in April that it will further expand its product range this year, introducing the leisure series represented by the X-TOP brand and the Xtep 1+1 children's series, and open 100 this year. Children's clothing shop.

Looking for new profit growth points Observers in the industry believe that the considerable gross profit level and the huge growth potential of this market segment have become an important reason for attracting adult sports brands. In addition, the traditional business of domestic sports brands has entered the adjustment period in the past two years, and companies have begun to pay more and more attention to the children's wear business.

According to the annual report, domestic sports brands suffered from a backlog of inventory and slow performance growth in 2011. It is understood that Li Ning’s merchandise inventories amounted to 1.133 billion yuan last year, Anta’s stock amounted to 618 million yuan in 2011, and 361° stocks amounted to 451 million yuan in 2011. The relevant analysis believes that the domestic sports goods market has dropped from 20% year-on-year to about 13% in 2011, and it is estimated that the growth rate in 2012 will further slow down to around 5%-8%.

While the growth rate of adult shoes and clothing slowed down, children's wear showed a better growth trend. Barabara’s revenue growth in 2011 even surpassed its mother brand “Summa” casual wear.

361° Vice President of Capital Operation Chen Yongling frankly stated: “The acceleration of the speed of children's wear field development is based on the optimistic view of the future development potential in this field. Coupled with the current domestic children’s wear industry, there is no strong brand, and it is also an opportunity for the growth of new brands. On the other hand, 361° also hopes to use the multi-brand strategy to drive the group's performance and create new profit growth points."

Relevant person in charge of Li Ning Company stated that adult brands enter their children with their own advantages: First, the brand awareness and influence accumulated in the field of adult sportswear for many years; Second, the original business system will also fully support and drive children's clothing. development of.

According to the China Investment Advisor's report, the compound annual growth rate of China's children's wear market is 22%, and it is expected to grow to 306.1 billion yuan in 2013. However, the competitors in the children's clothing market are becoming more and more intensive. In addition to domestic sports brands, Nike, Adidas, Semir, Metersbonwe, Annunciation and luxury brands Versace, Gucci, Armani, etc. have also entered, plus domestic Outside the original pure children's wear brand, the entire children's wear market has actually become a battlefield without smoke.

Some industry insiders are concerned that adult apparel companies have advantages in production, technology, operations, management, and brand influence compared to those focusing on children's wear. However, adult clothing and children's wear are from fabrics, designs, and operating modes to brands. There is always a difference in promotion. It is still unknown whether adult shoes and apparel can continue to be advantageous in the field of children's wear. It is understood that Bosideng chose to withdraw just one year after he announced his entry into the field of children's wear.

“The success of the new brand, product positioning is very important, whether or not we can rely on core competitiveness, effective integration of available resources, and to give enough attention to the children's clothing business is also very important.” Chen Yongling said, “And these two companies are doing Things."

It is understood that the domestic children's clothing industry market is broadly divided into two echelons, one is in shopping malls, the price of clothes is between 180-350 yuan, and the other is in the lower-end market (gates), the price is 25 yuan. - Between 30 yuan. There is an empty space of 80-150 yuan, which leaves a lot of room for development for domestic children's wear brands.