Seven Wolves Men'S Wear Clearly Defines The Brand Concept Of "Character Men'S Wear"

According to the annual report of Septwolves in 2012, the company realized an operating income of 3476991100 yuan during the period, with a year-on-year growth of 19.05%; The total profit was 75.30299 million yuan, up 54.24% year on year; The net profit was 561.116 million yuan, up 36.09% year on year; The gross profit margin increased by 4.28% to 45.48% year on year.

During the period, Seven Wolves insisted on the strategic transformation from "wholesale" to "retail" enterprises, increased channel support, classified and adjusted channels to enable them to undertake the upgrading of products and brands and ensure the stability and effectiveness of channels. In addition, in the face of a weak consumer environment, e-commerce business plays an important role in the company's de stocking. During the period, e-commerce realized sales revenue of about 180 million yuan, with a year-on-year growth of more than 70%.

　　 Black label revenue accounts for more than 50%, boosting gross profit

During the period, the sales of black label products grew rapidly, accounting for more than 50% of the revenue. In autumn and winter of 2011, the proportion was 30%. The continuous increase in the proportion of black label products boosted the company's gross profit margin by 4.28% to 45.48% year on year.

At present, Seven Wolves has many series and brands including fashion black label, classic red label, leisure green label, Saint Worth, SWJEANS, SWKIDS and accessories. In 2012, the company achieved a main business income of 3312050300 yuan, a year-on-year increase of 24.90%, which was mainly due to the steady sales policy of the previous few years. The growth rate of orders will be high, and the company's orders will be well executed during the period; The cost of main business was 1769489400 yuan, up 17.04% year on year.

By product, the jacket revenue was 519991510.73 yuan, up 29.95% year on year; The gross profit rate was 45.03%, up 1.68% year on year. The revenue of suits was 167400418.92 yuan, a year-on-year increase of 29.36%; The gross profit rate was 50.77%, up 4.23% year on year. The revenue of shirts was 342821071.77 yuan, up 121.83% year on year; The gross profit rate was 48.97%, up 3.53% year on year (see the table for details).

By series, since the company proposed to replace the green label series with the high value-added black label series in 2011, the franchisees have given good feedback. China Merchants Securities pointed out that the gross profit rate of the company was mainly promoted by the upgrading of product structure, and the continuous increase of the proportion of high value-added black label enabled the company to achieve a steady growth in sales (in 2012 clothing The sales volume increased by 6.18%), driving the growth of main revenue by 24.90%.

During the period, the expenses were 682.9765 million yuan, up 9.24% year on year; Net cash flow from operating activities was 438.171 million yuan, up 73.70% year on year.

The latest quarterly report shows that the growth rate of the company's revenue fell back in the first quarter, achieving a revenue of 950 million yuan. Affected by weak terminal demand and declining profits of franchisees, the growth rate of the company's single quarter revenue fell to the lowest point since 2009, with a year-on-year growth of only 0.46%. The net profit attributable to the shareholders of the listed company was 185 million yuan, up about 7.17% year on year; The gross profit rate was 46.59%, slightly higher than that at the end of 2012.

Orient Securities pointed out that the company's business model of mainly joining the order meeting resulted in a relatively lagging response of the report to the retail terminal. At present, the domestic retail terminal is still depressed, and the decline in profitability of franchisees will lead to greater operating pressure in 2013. It is expected that the orders of the company in the two quarters of 2013 will decline by double digits.

　 Clarify the brand concept of "character men's wear"

During the period, the company defined the product orientation of "character men's wear", strengthened commodity planning, optimized commodity research and development mode and planning process, cooperated with 3M, DuPont, Meimian and other international first-line fabric suppliers, improved commodity quality and style, and strengthened product marketability.

In 2012, Seven Wolves insisted on the strategic transformation of "retail" enterprises. During the period, the company's brand operation ability has become increasingly mature and perfect, and has adopted multi angle and all-round brand promotion and marketing techniques. The company continues the effective brand promotion strategy, and builds brand reputation on the basis of ensuring brand popularity. It operates the brand through public relations activities, cultural cooperation, star endorsement, event marketing, terminal display, TV series implantation and other ways.

In March 2012, the company cooperated with Huayi Brothers strategically, and creatively opened the precedent of cross-border brand cooperation in the clothing industry; Li Chen and Feng Shaofeng joined the company's Mingshitang and became the spokesmen of the company's new product season, shooting a new image and product advertising; In April, we customized senior men's clothing for China Directors Association; The first men's wear museum in China was opened in June; In November, image advertisements were simultaneously launched in 16 mainstream airports across the country; In December, together with Basha Men, the first "2012 Chinese Character Celebrities Award Ceremony" was held, bringing together hundreds of elites from the performing arts, fashion, culture, sports and art circles, presenting Zhang Jike, Li Yapeng, Fan Bingbing, Ma Weidu and other character celebrities.

The all-round promotion has made the concept of "more than one man, consistent character" widely recognized by the audience. The brand leadership of Seven Wolves has been further demonstrated, which has also provided favorable support for sales and laid the foundation for the upgrading of channels and products.

During the period, the company deepened the construction of commodity planning, increased the proportion of independent development, strengthened the construction of strategic suppliers, and improved the terminal competitiveness of products; Continue to strengthen the development and promotion of black label products that have been well received in the market. The sales of black label series products are growing rapidly, and the product planning strategy with black label as the main axis continues to advance steadily.

Since most of the products of Septwolves belong to external garment procurement, the supply chain is particularly important. After years of running in, the company has formed a long-term and stable strategic partnership with a number of efficient suppliers. An efficient and stable supplier team provides a strong guarantee for its operation. In addition, the company also cooperates with professional third-party logistics enterprises, which not only realizes rapid and accurate logistics response, but also saves logistics and warehousing costs.

CICC pointed out that in 2012, the company's brand marketing strategy was sublimated, and the emphasis on character was added to the brand concept, synchronized with the upward adjustment of the product structure. In terms of marketing mode, it has reduced the proportion of TV advertising, and paid more attention to public relations activities, cultural cooperation and terminal display. The cooperation with Huayi has strengthened the brand's popularity and influence. Among all Fujian style men's clothing, the advertisement of Seven Wolves emphasizes brand culture rather than category, which is reflected in the balanced sales of various categories and stronger comprehensive strength of the company.

　　 E-commerce revenue increased by 70% to 180 million

During the period, the company's e-commerce scale continued to expand, achieving sales revenue of about 180 million yuan, with a year-on-year growth of more than 70%. The company has established a controllable distribution system, constantly increased the attempts of e-commerce, and used high-quality brand resources to carry out cross category joint activities to improve brand exposure and influence. At the same time, the company is trying to try the O2O model as the development direction of e-commerce.

Seven Wolves is another online enterprise among Fujian Business Men's Wear. At present, it has opened direct flagship stores on Taobao, Jingdong, Tencent, Kuba, Store 1 and other platforms. In addition to direct business, it also has a large number of online dealers, who are distributed in most channels of the whole network marketing, and cooperate with the official flagship stores to form an e-commerce "wolf pack".

At present, Septwolve E-commerce is mainly involved in the handling of inventory products. In order to relieve the pressure on dealers' inventory and promote the rational structure of terminal goods, the company increased the proportion of channel exchange during the period, and carried out effective inventory promotion programs to assist channels in handling inventory. In addition to e-commerce, in 2012, the company and its agents also cooperated with Wanqian Department Store to carry out 8 special sales activities in 7 cities, including Xiamen and Fuzhou, and at the same time, 7 new factory stores were added for centralized inventory disposal. Under various de stocking measures, by the end of 2012, the company's inventory scale was 566 million yuan, down 11.84% year on year, including 6.4747 million clothes, down 0.05% year on year.

Seven Wolves decided to develop e-commerce in 2008, but in the previous three years, there were about 20000 sellers on Taobao selling their goods. They made seven wolves obtain a certain sales group on Taobao, but also brought a series of problems such as fake goods and fleeing goods. In order to prevent the situation from getting worse, Seven Wolves established an official flagship store and began to standardize Taobao stores that were selling, from shop decoration to customer service standards, from official authorization to guidance management.

During the adjustment period, the seven wolves adopted the channel management strategy of "focusing on the big and letting go of the small". All large online dealers were called for a discussion. They were required to differentiate categories and styles according to user groups. They should have their own unique focus and be split according to the criteria of who is better at new product promotion, sales, tail handling, and data marketing analysis. In this game, the uncooperative dealers were removed from the Internet by the Seven Wolves, and finally there were five large dealers, known internally as "General Five Tigers". The company provides separate rebates for these five dealers to ensure that they are fully balanced and that they can gain their own profits in differentiated competition. The company will measure them according to the repeat purchase rate, customer price, praise, etc., and give them more incentive opportunities.

Seven Wolves currently implement online and offline linkage. At the beginning of each year, the company will negotiate with various e-commerce platforms to determine the goods matching and performance target planning for the whole year in advance and adjust it every half a year. At present, the online and offline dealers of Septwolves participate in the group order meeting at the same time and have to pay the deposit in advance, but the place of order is different. However, online dealers are divided into three grades of ABC according to their credit rating. According to their sales expectations for the next year, the dealers with a credit rating of C will only give 60% of the goods, while those with a credit rating of B will only give 80%. The rest will be adjusted according to the inventory. The best credit rating of A will be 100% of the goods, which can effectively avoid the inventory risk of completely liberalizing the sales of goods.

In addition to the management rules of overall control, Seven Wolves has also formulated a series of differentiated operation strategies to cope with the diversification trend of the whole network distribution, such as finding out the special attributes of each platform and making differentiated matching.

According to the plan of the Seven Wolves, the online and offline needs to be integrated in the future. The online needs to be an offline support, and the offline needs to be an online service station, where online and offline benefits can be shared. Septwolves said that at present, the company's channel is still dominated by physical stores, which leads to the company's need to compete with a wide range of retail industry participants for store resources. Due to objective reasons, the overall efficiency of physical stores in the clothing industry is low, resulting in disadvantages in the competition for store resources. With the coming of e-commerce, online and offline choices and trade-offs have become an important strategic choice for brand merchants mainly focusing on physical stores.

　 Channel classification and adjustment

Seven Wolves said that after the rapid expansion in the past few years, Brand clothing At present, the enterprise has passed the extensive and rapid development stage of "horse racing enclosure". With the growth of commercial property prices, the cost of circulation links will further increase, and the "extension" expansion will face pressure in the future. Whether the terminal profit level can be improved by improving the terminal operation capability becomes the most important factor for brand clothing enterprises to continue to develop. The key to future growth is to transform the development mode, implement the strategy of "wholesale to retail", and rely on the promotion of products, supply chain and terminal management to bring about the promotion of single stores. The company will unswervingly implement the wholesale to retail strategy, strengthen the cultivation of retail ability, and enhance the core competitiveness of the enterprise.

The intensive cultivation of physical stores has been the strategic focus of Seven Wolves in recent years. During the period, the company improved the channel classification, classified "channels" according to "products", and strengthened the fit between "channels" and "products"; The customer groups and needs of each store are analyzed in detail, and the channels are divided into "upgrade stores", "transition stores" and "general stores". Each store matches the corresponding product standards and product classifications, and is equipped with different display styles and incentives. Through channel classification, on the one hand, channel efficiency has been improved, and on the other hand, more guidance and direction have been provided for the company's commodity planning and marketing. In 2012, the company's channel classification basically took shape, and will be further adjusted and improved in subsequent operations.

In view of the decline in terminal profits, the company increased support for key channels during the period, increased more than 10 million yuan of store rent subsidies, and alleviated the cost pressure of some key stores due to the increase in rent. At the same time, strengthen the implementation of tripartite agreements with agents and some dealers, and directly implement credit, rebate, subsidy and exchange to some dealers, so as to rationalize the channel profit distribution and improve the terminal operation capability.

The company also implements the "embedded" management of agents according to local conditions, optimizes the functions of offices, assists agents in sorting out the organizational framework and service standards, puts forward suggestions for operational improvement, improves agents' distribution management capabilities, ensures the effective implementation of relevant marketing and support policies, supports the growth of potential agents and dealers, and constantly optimizes the channel team, Ensure the healthy development of the company's channel construction.

During the period, the company actively planned to open core strategic stores in key business districts of second tier and above cities, so as to enhance brand influence. At the same time, according to the market competition and retail performance of stores at third tier and below, the company increased the store layout in this area, and encouraged the construction of large stores in third tier and below cities. From the data, the consumption boom in third tier and below cities is relatively high, and the related stores arranged by the company will bring significant contributions and impacts to the company's sales revenue.

By the end of 2012, the company had a total of 4007 terminal channels, a net increase of 31 over the same period last year, and closed a number of blue label and children's clothing stores with poor promotion effect. Seven Wolves said that under the influence of the macro-economy, "extension" expansion was under pressure. With the classification of supporting channels, the company shifted more focus from opening new stores to the reorganization, reform and expansion of old stores. Although the growth of the total number of stores slowed down during the period, the overall sales area increased by about 30000 square meters, an increase of about 6%.

During the period, the company continued to enhance its retail management ability and promote the standardization construction of the retail system. On the one hand, it carried out rectification of terminal stores to improve the image of terminal stores, and on the other hand, it provided various trainings for terminal stores. In order to train terminal talents and improve retail management, the company organized national elite store managers to train in Japan; In order to promote the national standardized display, the company conducts skill upgrading training for the excellent display personnel of subsidiaries and agents, enhances the skill level of national displays, and establishes a nationwide display standardization system. The company also continues to improve the national standardized promotion program library "36 Sales Plans", and each region can develop promotion activities in line with the local market according to the regional market situation, referring to the contents and specifications of the manual.

According to the plan, the focus of the company in recent years is to concentrate resources on training retail management ability, deeply maintain brand reputation, implement channel rectification, and promote the improvement of sales revenue scale and industrial chain management level of the company.

Orient Securities pointed out that the short-term profit adjustment of the company is inevitable, but in the medium and long term, it is still optimistic about the development opportunities in the industry reshuffle of enterprises with solid brand foundation and actively changing business philosophy, such as Seven Wolves. It is estimated that the company's EPS in 2013-2015 will be 1.13 yuan, 1.39 yuan and 1.66 yuan respectively, and the company will be given 15 times PE valuation in 2013 and downgraded to overweight.

China Merchants Securities pointed out that although the reorganizing of channels has slowed down the company's epitaxial expansion, the cultivation of endogenous efficiency is more consistent with the mainstream trend of sustainable development of the brand industry in the future. The company has passed the rapid extension and expansion period. Under the normal economic environment, under the premise of ensuring the normal closing rate (8% - 10%), considering the expiration of the lease, the transfer of the business circle, the loss of the store and other reasons, it is estimated that there will be a net increase of about dozens of stores every year. The adjusted company's EPS from 2013 to 2015 was 1.20 yuan, 1.37 yuan and 1.59 yuan respectively. In the short term, the company's performance growth is facing some pressure, especially the data of the order meeting in autumn and winter may not be ideal, so the rating is adjusted to "prudent recommendation - A". However, based on the leading position of the company in the business leisure field, the competitive pattern is more favorable, and the company is moving towards a retail thinking that conforms to the trend, the operation and retail ability will be increasingly strengthened, and there is room for improvement in the quality of individual stores in the future. It is expected that the company's comprehensive competitiveness in the business leisure segment is still the most advanced.