The hidden dangers of the expansion of local sports brands, the predicament to be broken, where is the road

Insiders pointed out that Chinese sports brands want to go out of the country, still need to run a difficult marathon, how to make further breakthroughs in the field of sports brands, has also become a new topic facing the industry. In the just-concluded 2012 London Olympic Games, China's athletes have made remarkable achievements. In terms of sports brand competition, Chinese sports brands have also begun to move toward the country to the international market.
Local sports brands want to break through

The London 2012 Olympic Games ended in a fierce competition. Like the Olympic athletes winning gold and silver medals, they also attracted the attention of the Chinese sportswear brands that frequently appeared in the Olympic Games. In order to take advantage of the opportunity of the Olympic Games to market, domestically-made well-known sports brands are almost out in the air and have won many countries' sponsorship rights.

In this Olympic Games, Li Ning, the traditional Olympic marketing strongman, has always supported five gold medal “Dream Teams” - gymnastics, table tennis, badminton and other sports teams' sponsorship rights. Anta is not outdone, and won the Chinese delegation in one fell swoop. Champion Longfu" and sponsorships from various countries.

Hong Xinger was even more aggressive and sponsored seven delegations including Iraq, New Zealand, Slovenia, Algeria, Lebanon, Jordan, and Cyprus. In addition, Jordan Sports designed prizes for three delegations from Kazakhstan, Turkmenistan, and Mongolia. In addition to sponsoring six Chinese national teams, 361 Degrees also sponsored six national teams including North Korea.

Industry sources said that China's sports brands tried to use the Olympic Games to drive sales and push the brand's influence to the world. "This has become the unanimous desire of local brand owners."

Although the Olympics were over, the popularity of sports brands continued to persist. Major brands launched discounted promotions after the Olympic effects.

Recently, the reporter learned in Li Ning, Nike, Anta and other Beijing stores that the original price of 148 yuan compassionate, discounted 74 yuan; the original price of 299 long-sleeved jacket, after folding 149 yuan ... nearly a hundred products launched 70%, 50% or even 30% off the discounted price.

Li Ning, Beijing Changping shop owner told reporters: "Now the shop launched discounted promotions as above, on the one hand to celebrate the London Olympics, on the other hand to adapt to seasonal changes, to welcome the autumn market; as to when the event ends, to wait for the above notice Just known."

Rapid expansion of hidden dangers

In fact, unlike the 2008 Olympic Games, the current European Olympics debt crisis worsened, the US economy was weak, and even the Chinese economy was showing a downturn.

The above industry sources pointed out that although major brands have used the Olympic Games to enhance the value of their own brands, but many domestic sports brands have undergone rapid expansion in recent years, and the hidden dangers of expansion gradually exposed as the economy slows down.

According to rough statistics, from 2007 to 2009, there were a total of nearly 20,000 newly-added stores for locally-listed sportswear companies. At the same time as the store expansion, the sales volume did not reach expectations, and the resulting inventory pressure also gradually increased.

Among them, Li Ning's annual report shows that its inventory for the past year has reached 1.13 billion yuan, almost twice that of 2008. In addition, the inventory of several major sports brands is also huge. Anta had an inventory of 618 million yuan, special steps inventory of 671 million yuan, 361 degrees of inventory of 451 million yuan, and Peak inventory of 421 million yuan. Reduced orders and high inventory throughout the year have caused Chinese sports brands to agonize.

However, domestic sports brand inventories have increased year by year, and sales performance has declined to varying degrees. According to the data, Li Ning’s order amount in the fourth quarter of 2012 decreased by 20% year-on-year, 361 degrees in the fourth quarter of 2012 decreased by 20%-30% year-on-year, and ANTA’s order amount in the fourth quarter of 2012 fell by at least more than 10% year-on-year.

The reporter telephoned Mr. Wang of Li Ning distributor in Wuhan Division. Mr. Wang complained to the reporter: “The company’s increasing number of stores and the annual ordering of inventory have given us great pressure.”

According to Li Ning’s distribution network, Li Ning’s head office has branches in East China, South China, etc. There are several major distributors under each branch, and each distributor has several distributors directly under the line. Mr. Wang is one of the distributors. He got the goods from the upper-level dealership speeding company, and the speeding company made direct purchases from Li Ning Beijing Sports Goods Corporation and earned the difference price.

Second-tier cities such as Wuhan have always been an important market for Li Ning. On the two-and-three-meter-long section of the Wuhan Division Gate, there are three Li Ning stores, one of which is a newly opened store for dealers.

“Since the dealer company opened the store, their annual turnover has been reduced by about 20%.” Mr. Wang said that the goods that cannot be sold can only be piled in the warehouse and sold on special sales.

"This exposes a series of development issues in which Chinese sports brands are facing too much inventory, too fast expansion, too many stores, and too high product homogeneity in the face of wave after wave of sports boom. "The above person told reporters.

Where are the local brand outlets?

"A series of contradictions have verified that the dazzling Olympic Games cannot ignite a fire for the local sports brand market." The above-mentioned persons interviewed by the reporter believe that while the substantial expansion, the serious homogenization of the products became the sporting goods industry's exposure to the other. A deadly short board.

In fact, the local sports brands have insufficient brand segmentation in business operations, and the problems such as unclear brand positioning have led to a serious homogenization of the sporting goods market. The competition between local sporting goods companies and weak local cultural awareness is also a major factor in the problem of inventory backlog and single point of profit.

“Domestic sports brands are hoping that the Olympic Games will break the siege of Adi and Nike, and it will not seem realistic to go to the international market.” Wang Zongxi, a renowned lawyer of Beijing Liangao Law Firm, told reporters.

Where are the local sports brand outlets? Some industry insiders believe that under the current background of the weakness of domestic brands in the international and domestic markets, whether companies should carry out resource optimization and reorganization, combine a group of enterprises with weak corporate strength, weak brand influence, and less market share, integrate resources, To occupy the market with strength?

Hu Xingdou, a professor of economics at the Beijing Institute of Technology, said in an interview with reporters that mergers and reorganizations are good, but it is not easy for Chinese people to realize them.

“From a policy point of view, the government's strict supervision has on the one hand curbed the speculation of some unscrupulous companies, but it also prevents local brand enterprises from realizing the market's self-regulating mechanism. If the company is to grow, the government should give the local brand enterprises Creating a good legal environment, loose financing, and a fund-raising market environment are conducive to business growth."

Hu Xingdou, for example, said that Lenovo, as a private enterprise, can be described as an all-powerful player in the international and domestic markets. This is due to their emphasis on brand building, technology research and development, top-notch teams, and accurate market grasp. While the local sports brand enterprises are bigger and stronger, they must stand in the height of international competition, view and plan the development of the company. Although they start at the low end, they must be positioned at the high end. Only in this way can companies capture market share. "From the perspective of the industry, local brands want to break through, and they must pay attention to the construction of local brands."

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