Belle: The last step of the shoe king
The era of super-big brands is gone, but the various transformation attempts of "Shoe King" Belle have never changed.
When the Dahe River is branched, it will not find another way but stick to the river. Of course, it will only have to run out of water, and the advantage is futile.
The final step of the shoe king is to withdraw from the market.
Belle was privatized and delisted for HK$53.1 billion. This record of setting a new record for Hong Kong stocks is still far from the market value of HK$140 billion at the peak of Belle's decade ago.
On April 28th, Belle International announced that Gaochun Capital, Dinghui Investment, and Belle executive director Sheng Fang and Yu Wu formed a consortium to propose a privatization offer to Belle International. The offeror stated that the write-off price will not be raised.
Even if it is “sellingâ€, this price has a higher premium than Belle’s performance in the past year. Belle International’s price per share before the suspension was 5.27 Hong Kong dollars, and the market value was only 44.4 billion Hong Kong dollars. Behind this, Belle’s same-store sales have experienced negative growth for 13 consecutive quarters, and net profit fell 18% in the 12 months to February 28, and the core footwear business lost 10% of sales. Home - Turn off 2 stores every day on average.
Belle International said that the company is in urgent need of transformation. But there is no lack of risk in transformation, and privatization will help to advance the implementation of relevant strategies. Looking back on the transformation of Belle over the years, I will not change, I will try my best, and I will think of it as a key word. Who can think that the "Shoe King" has become a burden of the new era in the past few decades.
Strong growth
On May 16th, at the last performance conference of Belle, Belle CEO Sheng Baijiao said: "On the day of Belle's listing 10 years ago, it had frozen more than 400 billion yuan of funds, even surpassing the Industrial and Commercial Bank of China. Fortunately, there was no intention to forget. Talking about the road to success, or today is even more self-sufficient."
This rarely-showing CEO, the discourse is a complex emotion that can't be concealed.
Sheng Baijiao has recently retired, recalling that he once claimed that “every place where there is a woman, there is Belleâ€, this scene is even more tragic. At the same time, it is worth noting that after the privatization, former Belle Chairman Deng Yao and CEO Sheng Baijiao will no longer hold shares of the company, totaling HK$13.093 billion.
The departure of the "Deng Sheng match" for 26 years may indicate that Belle will enter a completely different track. For a long time, under the combination of "Deng Sheng match", Belle has been moving towards the goal of super big brands.
The first is large-scale. From the shoe-making to the retail, Belle founder Deng Yao created the whole industry chain model for women's shoes for Belle, and then aimed at the mainland market to seize the opportunities.
In 1991, after Shengbaijiao joined Shenzhen Belle as the general manager, he also focused on occupying shopping malls and street shops, and paving the way. From 2010 to 2012, Belle has more than 1,500 new net stores each year. In 2013, the total number of stores exceeded 19,000, and all of them were directly operated.
Another is a strong acquisition. In 2007, Belle was listed in Hong Kong. With capital blessing, Belle not only accelerated the acquisition of integrated retail network, but also began further brand expansion: 380 million yuan to acquire Fila, 600 million yuan to acquire Millies, 1.6 billion yuan to acquire Senda...
In addition to the previously acquired Tianmeiyi and other brands, Belle has gradually formed a super-brand matrix: Belle, Skatu, Zhenmei poetry, others... plus the agents of Bata, CAT, Clarks and other brands, basically realized the user Covered by full age and full price.
The above two completed the absolute right of Belle in brand, production capacity and channel, which allowed Belle to have a monopoly in the mainstream department stores at that time. More than half of the malls and even all footwear areas were covered by Belle's brand. . As a result, Belle has mastered the pricing power, and the price is often 30% higher than the peers.
Large-scale, strong acquisitions, monopoly operations, and high pricing have driven Belle before 2012 (except in 2008), and its net profit has grown at a rate of more than 20% per year. Its profitability is strong, and the industry is the best.
But looking back on this journey, it is not difficult to find that Belle's advantage comes from several aspects: First, the early market advantage of Belle's early market with "Hong Kong brand, mainland production"; Second, the occupation of the mainstream channel to the highest point, The market forms a dive advantage; the third is the multi-brand coverage, forming an exclusive monopoly advantage.
As a result, these three advantages have been fragile under the current trend of loss of pre-emptive dividends (from supply and demand to supply exceeding demand), channel diversion and brand personalization.
Fragile transformation
The transformational attempt of Belle is still a tribute to the past advantages.
For example, with the help of channel advantages, it has become the largest distributor of sports brands in China. In 2014, Belle Group's net sales margin rebounded to 15.5%, which is due to the increase in net profit from sports and apparel business.
In addition, through a series of acquisitions, we tried to expand the new category based on the original advantages. In 2013, Belle acquired the Japanese clothing retailer Baroque, the Italian brand Lannuo, and the domestic high-end men's shoe brand Long Hao Tiandi, hoping for an extension of the growth.
There are also attempts to sink the channel. Unfortunately, whether it is clothing, or the competition in the third and fourth-tier markets has long been heated, Belle, a "newbie" and a latecomer, does not have any advantage.
There is resistance in the transformation, just like Shengbaijiao said: "If Belle wants to transform better, it needs relevant talents and funds, sacrifices short-term interests, and pays attention to long-term goals. These actions will have an impact as listed companies. I believe in privatization. The situation will be smoother."
But in fact, without prejudice to the channel, Belle can still turn the first step by talking about the brand "story." Nowadays, users' perception of a brand image is three-dimensional. It is no longer based on how many stores, but will look for evaluations of the brand from social networks and e-commerce platforms, and even interact directly with brands to build this brand. Awareness. Like the fast fashion brand Uniqlo is actively establishing interaction with users, opening a special area in the flagship store, allowing users to design their own T-shirts.
Distinguishing brand tonality and combing the long tail demand should be a good cut for Belle. Belle's transformation strategy is still changing, turning around the advantages of degradation, allowing brand aging and product homogenization. Until 2015, Belle International's net profit was only 2.934 billion yuan, a sharp drop of 38.4% from the previous year.
Not tossing
After the delisting, Shengbaijiao let Belle go to the present situation, blaming him for "not making a good prejudgment and response to market changes." Indeed, in the era of C2C, B2C, O2O and other concepts have come one after another, Belle has also faced a decline in performance in the 2015 fiscal year, Sheng Baijiao at the performance briefing talk about the transformation is still very hesitant, actually sighed: " I am 65 years old, how much can I toss?" Even asked the reporters on the spot "Would you like to transform?"
In the early days, Belle's production model had its advantages. The typical model of shoe enterprises in the industrialized era is mass production, which is sold to franchisees or direct sales stores through order fairs, and is updated on a quarterly or semi-annual basis. The sales are stratified by the first-line, second-third-line, and fourth-five-line cities, and the layers are discounted to digest the tail goods and stocks.
Belle has made some innovations on this basis - its stores are all direct-operated, designed to understand the hot-selling styles through buyers, and then design the next season's models; production first small-scale trial sales, each will first put 50 % to the market, then modify the style through market feedback, and make up the order. In this way, Belle's inventory control has always been very good compared to its peers. This is also the victory of Shengbaijiao's "trial and error" concept.
However, in 2015, the mainland market has been fully exerting “Internet +â€, and the landing of foreign fast fashion brands has brought offline competition to the fast, accurate and fine C2M field – it is no longer scale. It is speed.
Belle's innovation does not focus on improving the turnover rate. The time from the drawings to the finished product still takes 3-6 months. The way of ordering, but also the turnover days for several months.
It is also ZARA, which is directly operated by the store and has a full industrial chain. Its product is designed to be on the shelves, and it takes an average of 10 to 15 days. Behind this is a huge collection design team, data-based production management, and a fast production chain that adheres to the “Made in Europeâ€.
It can be said that Belle's entire industry chain is for scale service, while ZARA and other fast fashion brands, the entire industry chain is for speed.
By mimicking the design of luxury brands, ZARA will launch more than 12,000 styles a year, each with a small number of single stores, and the same products will not be placed in the store for more than three weeks. Each of its stores orders directly from the headquarters on a weekly basis, and the products will arrive at each store within three days. Quick change guarantees a continuous freshness. At the same time, fast fashion brands don't care how many people a product can cover. They care about whether a certain product can accurately hit a certain group of people and achieve rapid sales.
In contrast, Belle, there have been media reports, the proportion of its bold and innovative shoes accounted for only 40% per year, the rest are based on the first year of the best-selling small repair. It's hard not to leave consumers with an "outdated" impression.
In addition, Belle's "high pricing, low discount" strategy has also been hit by ZARA's "first-class design, second-rate fabrics, third-rate price". Today's shopping malls are compatible, and Belle has more brands to sell. The fast fashion brands represented by ZARA often choose to open a big store in the place where the first-line brands are piled up, and it is easy to be an enemy.
The pain of Belle is that it is necessary to turn the whole industry chain model for scale service into speed service, which is a complete revolution of the whole body. It is indeed “tossing†for the growing age of Shengbaijiao. However, look at the 68-year-old Liu Jingzheng is still speeding up for Uniqlo: The group plans to shorten the production cycle from design to delivery to about 13 days, and strive to be comparable to ZARA. "Do not toss and not live" is probably the basic condition for the old brand to survive in the new era.
Doing e-commerce, looking for users
At the 2016 interim results conference, Sheng Baijiao faced the “e-commerce†that could not be seen, touched or read, and sighed that “it caused a huge threat to the group. The performance of the group was within the foreseeable one to two years. It is impossible to reverse."
This statement, it is obvious that e-commerce is positioned as an enemy and non-friend, which is a common problem of many traditional entities. The management's biased judgment has actually set the tone for its e-commerce development. Belle's e-commerce transformation is a typical example of “returning to welcomeâ€.
As early as 2008, Belle gradually established the e-commerce model of the whole network marketing according to the development steps of Taobao distribution-Tmall flagship store-B2C distribution-independent B2C website Taoxiu. The products are also gradually developed from the sales of Belle's brands. This was once seen as a successful example of a traditional enterprise transformation e-commerce.
However, with the rise of B2C platform for vertical footwear such as Haole and Letao, Belle re-integrated resources in 2011 and established a new Belle E-Commerce (Shanghai) Co., Ltd., which concentrated the entire e-commerce business into a new B2C vertical battery. Business website is available online.
Belle took out the "shoe king" power to hold the best buy. In 2012, Xie Yunli, the then head of e-commerce, announced that Belle will invest 2 billion yuan to develop high-quality purchases. It also once "domesticized the monopoly of Belle's own brand and cut off other e-commerce sources."
At the same time, Xu Lei, the vice president of Jingdong Mall, and Zhang Xiaojun, the vice president of Vanke Eslite, joined the management team of Youbu.com as CMO and COO. At the same time, you can purchase your own warehouse and participate in the order fair as a large area to share the replenishment mechanism of Belle's supply chain.
It seems that Belle regards e-commerce as the 11th region (10 regions under Belle Line), and also gives it the mission of opening up new channels and establishing a new monopoly advantage: Youbu.com not only sells Belle's series. The brand will also sell any shoes and apparel brands outside the Belle system. Its direct competitors are Le Tao, Haole Buy and other footwear B2C. In the future, it may compete with Jingdong and Vanke. The goal is to achieve within 3 years. profit.
This concentrated and monopolistic development thinking still does not deviate from Belle's routine in the era of industrialization. But in fact, from the consumption scene, user experience to sales logic, it is completely different.
Youbu.com is a traditional entity that transforms e-commerce. The advantage lies in its strong financial strength and solid brand support, but the disadvantages are equally obvious. Youbu.com is limited to the overall layout of the company and is bound by the care of “orthodoxâ€, that is, offline business.
For a long time, the main task of the excellent purchase was to clear the inventory. Belle also worried that the online channel would affect the offline. Therefore, the online and offline goods were strictly distinguished, so that the excellent purchase was not able to provide services to Belle customers, and could not Sales of Belle's hot selling status.
Due to the strict distinction between online and offline, the customer data obtained by the excellent purchase is also difficult to use for Belle. Basically, it has "overheaded" the role of e-commerce.
The traditional enterprise transformation e-commerce, Haier Mall is a good reference, its goal is very clear, is to do services. The online order is completed by the offline store, the online is the entrance, and the data link is opened throughout the company. Every aspect of product design, production, sales and after-sales can benefit.
In the era of big data, data is the right to speak. Not long ago, the dispute between SF and rookie was to fight for this initiative. But Belle still ignores the user experience and data precipitation, moving toward scale.
In 2013, U-Purchase reached 1.1 billion yuan in sales, rushing to the throne of the largest footwear e-commerce platform in China, but vertical e-commerce also ushered in a decline period. The problem of high traffic acquisition costs and limited competitiveness of platform e-commerce products has been the paradox of vertical e-commerce. Utilities began to expand from footwear to apparel and other categories, trying to transform fashion e-commerce.
Then, internal changes, e-commerce executives resigned, and the excellent purchases did not occupy a favorable position in the big waves of the e-commerce platform.
In 2016, Shengbaijiao said that the company has tried at three levels, including allowing offline consumers to enjoy online services and consumer experiences; establishing a customer management system to enable customers to spend more in physical stores; and through online and offline Better interaction with consumers, promote the digital transformation of stores, goods, etc., so that offline stores do not become cumbersome.
In addition, the Belle online business has been transformed from the original independent operation to the core business, and 28 provincial capital warehouses can be shipped nearby. It is said that in August and September, a relatively good response has been achieved.
It is a pity that it is too late, Shengbaijiao's three sighs, the end of the Belle delisting, the founder withdraw. On June 9th, Ma Yun said at the 2017 Alibaba Investor Day Conference: “The core of the new retail is to shift from selling goods to consumers to serving consumers.†The phrase is true, this time, Belle’s big change, perhaps It is the inevitability of the era.
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