Market Disorder: How Did Anta Complete The Overtaking?

Anta (02020) annual performance will be announced, annual revenue and net profit have increased substantially.

Brand President Zheng Jie said Anta's brand influence increased by 17% in 2016.

After the whole cycle of the sports footwear industry, Anta gradually surpassed Lining and became the industry's well deserved boss. What has happened in these years?

Benefiting from the outsourcing of manufacturing industry in developed countries, the footwear industry began to rise in the 90s, from the initial foundry to the establishment of brand.

The rapid growth period of the whole industry seemed to stop abruptly until 2012.

Along with the obvious decline of demand, oversupply and inventory backlog, the recession is gradually coming. A large number of enterprises are out of business.

In this turbulent period, Anta quietly from

The first prize in the industry has been won.

In 2014, with the consolidation of enterprise inventory, the brand positioning was clear, and the terminal channel was adjusted and perfected, and the industry gradually withdrew from the recession.

In the same year, the State Council issued several opinions on speeding up the development of sports industry to promote sports consumption, and put forward that by 2025, a reasonable, complete and complete sports industry system should be established, with a total scale exceeding 5 trillion yuan.

At this point, the industry began to pick up. At this time, we looked at Anta again, and the performance was already riding on the dust, leading the whole industry.

2012 was the hardest year. Anta's brand stocks rose sharply, and inventory turnover increased from 38 days to 50 days with a sharp drop of 14% in revenue.

The same is true for the competitors. Lining's inventory turnover days rose from 72 days to 88 days, and revenue fell 25%; and the 360 degree rise from 55 days to 72 days, and revenue fell 12%.

In response to the crisis, the company began promoting the plan.

First, the ordering system is changed to a distribution system, and the retailer's pressure is shared by reducing the dealer's discounts and financial subsidies.

Secondly, in terms of inventory control, the company took the initiative to reduce the number of orders. In the third quarter of 2013, orders for Anta decreased by 10% to 20%.

At the same time, the company cancels the sales area and optimizes the distribution channel, and the dealer's KPI examination changes from the wholesale amount and the futures accuracy rate to the salesperson turnover rate, the same store growth, the sold out rate and the rental sale ratio.

And through installation of calculator and other equipment, collect customer price, conversion rate and other data for analysis.

After a series of initiatives, the company's revenue has improved significantly.

In 2013, the company's revenue dropped by 4%, but far better than Lining's -13%, 360 -27%, PEAK's -10%, and last year's -14%.

Single store revenue grew by 89%, and net profit fell from 21% to 3%.

By 2014, Anta's revenue growth had returned to 22%, far ahead of its competitors.

Moreover, the company launched a demand oriented retail management strategy in 2013.

To provide retailers with more accurate product development planning, order guidance and supplementary forecast, and set up factory shops and discount stores to better reduce inventory for retailers.

The craziness of expansion, the reform in the cold winter, and finally usher in glory, along the way, no one left behind Anta executives.

In the face of the crisis, China's apparent top management team's response and implementation, Anta's status is deserved.

The most difficult period of the industry has passed. Relying on channel expansion and scale effect, the era of extensive growth with "crazy shop" has also withdrawn from the stage of history. Under the trend of consumption upgrading, high quality, diversified demand and brand upgrading are inevitable directions.

How does Anta respond to changes in the environment?

Clear positioning is the core of brand development. Anta's catching up and the decline of its former brother are all tied up with brand positioning.

At that time, when Lining was unable to catch up with international brands in terms of product design and quality, the price was much higher than that of domestic brands.

At the same time, over 50% of the consumer group is 35-45 years old.

With the help of multiple brands to expand the market, cleverly avoid the trap of ambiguity.

Unlike Lining, Anta also wants to involve more customer groups, but the brand of Anta has always insisted on a cost-effective route. Sudden changes will only make it lose its customers, which is certainly not what management wants to see.

Therefore, with the help of the company

FILAKIDS and Desanto are targeting high-end customers. Anta, Anta children and NBA brands continue to serve mass consumption.

On the basis of preserving the original brand positioning, products are sold to more target groups.

After the multi brand strategy, the proportion of the company's brand stores has been adjusted year by year.

Bulletin data show that the number of Anta brand stores is significantly reduced, and the number of Anta children's stores has maintained a relatively high growth.

Due to the continuous loss of FILA in BELLE's hands, the number of stores has been reduced in the early stage. The number of stores began to increase steadily since 2014, and has now been profitable. In the first half of 2016, the growth rate has exceeded 35%. Due to FILA's contribution, the company's non Anta brand business, the three and fourth quarter growth rates were 60%-70% and 50%-60% respectively, and the FILA brand has become the most important driving force for the company's performance improvement.

At the same time, there is also a company's single store income.

The single store revenue in 2015 was 1 million 230 thousand yuan, 3 times the level in 2012.

In the same year, Lining, PEAK and PEAK sports earned 1 million 160 thousand, 350 thousand and 220 thousand respectively.

Multi brand strategy is of great significance, and the company will continue to invest in this field.

At the February 22, 2017 performance conference, Ding Shizhong revealed that the high-end brand DESCENTE introduced in 2016 will break even this year, and it will be profitable within two years.

At the same time, Kolon brand is also about to start, then Anta will open its journey in outdoor products.

Anta's current stock price is HK $23.65 / share, and the corresponding EPS is HK $1.03.

Compared with Lining's 25.7361 degree 10.2, XTEP International's 10.2, and American stock company's NIKE 24.8, Anta's 19.2 times earnings rate is not too low.

It is understood that in 2016, Anta's revenue was 13 billion 350 million yuan, an increase of 20% over the same period last year; net profit rose 16.9% to 2 billion 390 million yuan; the gross profit margin increased 1.8% to 48.4%.

Although revenue growth has slowed down, it is good for net profit growth to remain stable. The rise in gross margin reflects the company's competitiveness.

DESCENTE and Kolon will also be the new driving force for future performance improvement.

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