Under the new coronavirus epidemic, the catering, tourism, and film and television industries, as industries recognized to be severely affected by the epidemic, have become the focus of attention from all walks of life. However, it cannot be ignored that there are still other industries in the market that have also suffered heavy setbacks and are even experiencing a “big retreat” that is rare in history, such as the clothing industry.
The clothing market will evaporate 400 billion this year
Chegongmiao Fengsheng Town is one of the places where many young people in Shenzhen like to go shopping. It is home to many clothing stores.
“@Everyone, dears, our store has now withdrawn from Fengshengcho store. Thank you for your continued support. , wait for the follow-up.” One day in July, such a message suddenly popped up in the WeChat group of a children’s clothing store that has been operating in Fengsheng Town for nearly ten years, which was somewhat surprising.
According to the owner of the store, the reason for withdrawing from the site where it has been operating for nearly ten years is mainly due to the impact of the epidemic. The store’s business performance was poor, but the landlord was unwilling to lower the rent appropriately. Finally, the contract expired and the store owner was forced to decide to leave, although he might lose some customers as a result.
△Shenzhen Chegongmiao Fengsheng Town situation
You can see the leopard through the tube. This old store in Fengsheng Town may be the epitome of many clothing companies today. The flow of people in Chegongmiao Fengfengying shopping district is much less crowded than the lively scene before the epidemic. At the same time, there are scattered stores along the way that are closed and for rent. In some areas, there are many stores that have closed one after another for rent.
In Shenzhen’s largest women’s clothing wholesale market, which is well-known in the country, the current situation of the clothing industry’s downturn is also vaguely visible. In a certain area of a certain building in the wholesale market, several nearby shops 502A, 503A, 505A, and 507A are all closed and rented. The transparent glass door of the shop clearly displays the words “Management Office for rent at original price, Li Sheng 159…” , “Sublet, contact number…” and other rental advertisements.
△Several shops next to Nanyou Wholesale Market are closed for leasing
“Affected by the epidemic this year, business has been deserted. Some shops in Nanyou were forced to close because they couldn’t survive, but it was not a large-scale closure. There’s going in and there’s going out, and the industry is adjusting.” said a shop owner at Nanyou Women’s Clothing Wholesale Market.
Similar store closures are also common in other business districts in Shenzhen, such as Shangmeilin Metro Station and Futian Metro Station business districts. visible.
“This year is the most difficult year for the apparel industry since the reform and opening up.” Textile and apparel brand management expert, Shanghai Liang Cheng Weixiong, general manager of Qi Brand Management Co., Ltd., said that after decades of rapid development, the domestic apparel industry itself is already in a state of overcapacity, and the epidemic has accelerated the decline of the industry.
“2020 is bound to be a turbulent year. It is expected that the Chinese clothing market will evaporate at least 400 billion yuan in revenue. The overall market size Shrunk by 15%.” Liu Jinyan, vice president of marketing department of Convertlab, said during a keynote speech at a clothing conference in Shenzhen recently.
Authoritative data shows that in 1952, the total revenue of my country’s textile and garment industry was 9.4 billion yuan. By the end of 2019, my country’s textile and clothing industry The total industrial revenue has reached nearly 4.5 trillion yuan. In 67 years, the total revenue of the textile industry has increased 478 times.
Listed companies suffered heavy losses
The clothing market is deserted, and the leading clothing brands are also having a hard time. Recently, brands such as PEACEBIRD, ANTA, FILA, and Semir have successively released performance overviews for the first half of 2020. Except for individual brands that have grown against the market, most profits have dropped significantly or even suffered losses.
Peacebird
Ningbo Peacebird Fashion Clothing Co., Ltd. released its 2020 semi-annual performance report. The company achieved total operating income of 3.217 billion yuan in the first half of the year, a year-on-year increase of 3.09%; the net profit attributable to shareholders of the listed company was 121 million yuan, a year-on-year decrease of 8.55%. ; Non-net profit attributable to shareholders of listed companies was 56.2227 million yuan, a year-on-year increase of 129.14%.
Anta
According to Anta’s 2020 interim results profit warning announcement, in the first half of 2020 reporting period, its expected revenue will be the same or decline by no more than 5% compared with the same period last year, exceeding the original expectations; without taking into account the share of losses from joint ventures, The profit attributable to shareholders will decrease by no more than 25% compared with the same period last year; after taking into account the share of losses of the joint venture, the profit attributable to shareholders will decrease by no more than 35% compared with the same period last year.
According to Anta’s latest operating performance in the second quarter and first half of 2020, in terms of retail value, compared with last year During the same period, in the first half of 2020, FILA’s retail sales achieved mid-single-digit positive growth; the retail sales of other brands achieved high-single-digit positive growth. Moreover, Anta and FILA’s sales volume in the second quarter has recovered significantly compared with the first quarter, and is expected to continue to improve in the second half of the year.According to Anta’s guidance on revenue growth in the second half of the year, Anta’s revenue will increase by 5-10%, and FILA’s revenue will increase by 20-30%.
Seima
On July 14, Semir Apparel released a revised announcement for the 2020 semi-annual performance forecast, which showed that Semir Apparel expected to achieve a net profit of 00,000-72.21 million yuan in the first half of the year, a 90%-100% decrease from the same period last year.
Previously, Semir Clothing released a first-quarter report on April 29, which showed that Semir Clothing expected to achieve sales in the first half of 2020. Net profit was 72 million-217 million yuan, a year-on-year decrease of 70%-90%.
During the epidemic, store openings in shopping malls, shopping centers and other places were generally delayed, consumer terminals stagnated, Semir and upstream and downstream industries Chain companies have been delayed in resuming work, resulting in a significant year-on-year decrease in operating income.
In addition, the performance of casual clothing brands like Semir is not very satisfactory and has been experiencing slow growth. With the impact of this year’s epidemic, this unsatisfactory situation has further intensified.
Regarding the reason for the performance revision, Semir Apparel stated in the announcement that due to the impact of the epidemic, the company’s overseas business losses have increased.
Annair
On the evening of July 13, Anair released its 2020 semi-annual performance forecast, stating that the company’s net profit in the first half of the year is expected to be a loss of 13 million-18 million yuan, a year-on-year decrease of 123.09%-131.97%. Profit in the same period last year was 56.2979 million yuan.
The announcement shows that Anair’s net profit loss was mainly affected by the epidemic, residents’ outing activities decreased, and domestic large shopping malls and shopping centers The customer traffic in places such as this was sluggish, and the number of children’s clothing consumption scenes decreased. The company’s business was greatly affected, and its half-year operating income declined year-on-year. At the same time, Anair has expanded many new stores in 2019, and store rents and management fees have increased and are relatively rigid, which in turn affects net profit in the first half of the year.
Busen
On the evening of July 14, Busen Co., Ltd. released its 2020 semi-annual performance forecast, stating that the company’s net profit in the first half of the year is expected to be a loss of 33 million to 38 million yuan, a year-on-year decrease of 780% to 667%.
The announcement shows that the changes in Busen’s performance were mainly due to the impact of the epidemic in the first half of the year, and the sales performance of directly-operated stores and dealers The performance was not good, resulting in a significant year-on-year decrease in revenue and an increase in provision for inventory devaluation. In addition, according to the latest progress of the lawsuit, Busen Shares is expected to reverse liabilities of approximately 10.73 million yuan.
Sinur
On the evening of July 14, Shinur released the 2020 semi-annual performance forecast, stating that the company’s net profit in the first half of the year is expected to be a loss of 23.7 million to 35.4 million yuan.
As for the reasons for the net profit loss, Shinur said that in the first half of the year, due to the impact of the epidemic, economic fluctuations, industry regulations and The company’s business has been greatly affected by factors such as consumption suppression.
Seven Wolves
On July 14, Septwolves released its 2020 semi-annual performance forecast, stating that the company expects to achieve a net profit attributable to shareholders of listed companies in the first half of the year of 20 million-30 million yuan, a decrease of 83.80%-75.70% from the same period last year.
Regarding the reason for the decline in net profit, Septwolves stated in the announcement that during the epidemic, some prevention and control measures had a negative impact on the company’s production and operations. The impact resulted in a decrease in the company’s half-year operating income.
During the epidemic, store openings in shopping malls, shopping malls and other places were generally delayed, consumer terminals stagnated, and the Seven Wolves and upstream and downstream industries Chain companies have been delayed in resuming work, resulting in a significant year-on-year decrease in operating income. In addition, Septwolves has been relatively conservative in channel changes and business model development in recent years, mainly led by general agent franchisees, and the operating pressure brought by this development model is greater than the pressure brought by the private sector.
In addition to the uncontrollable factors of the epidemic, Septwolves also revealed in the announcement that as market competition intensifies, the company’s products The gross sales profit margin dropped, which led to a reduction in profits to a certain extent.
It can be seen that the epidemic has had a huge impact on the clothing industry. Even the industry market structure is quietly changing accordingly. In order to reverse the shrinking offline sales, most clothing companies have closed stores, reduced expenditures, and retained advantageous projects. Taking e-commerce channels as the mainstream route, coupled with innovations in channels such as live streaming and social e-commerce, will drive online sales and accelerate online conversions. We will re-examine and rationally plan the offline store network and strengthen online business to meet consumer needs. Ready to go, the temporary retreat is just to seize the next “Normandy”. </p
