uggs: Consumption chain the risk of a beautiful story ugg store

investment boom in the consumption chain, the success of both PE investment Belle, the beautiful story of Little Sheep, etc., but also PPG, ITAT and other stars took a plunge in the past. These failures reflect the consumption patterns have a common chain risk points, investors around the \
recent years, the capital markets an interesting phenomenon: for the same class of goods, investment sales channels are doing better than investments in manufacturing. For example, in May 2007, a shoe Belle International (01880.HK) listed in Hong Kong to issue price-earnings ratio of 31 times; in December 2009, the shoemaking Olympic sports (01968.HK) listed, only 9 times the issue of price-earnings ratio . October 2007, selling sportswear trends of China (03818.HK) listing release earnings ratio is 15.4 times; and in June 2009, the production of sportswear 361 degrees (01361.HK) market, the issue of price-earnings ratio is only 8 times. Even in January 2010 to channel sales Belle dominated and trends in price-earnings ratio of China was 37 times and 20 times, while the production-based price-earnings ratio Peak and 361 degrees were only 18 times and 12 times.

shoemaking as a shoe, make clothes to make money than selling clothes, reflecting the current investors and the capital market for both types of business model gives different pricing. Maybe this will make Olympic sports and 361 degrees veterans are depressed, but in the era of the big Chinese consumer context, chain model will no doubt receive more attention, of course, this area has also attracted keen sense of smell of PE, substantial investment. However, in recent years, the investment boom in the consumption chain, we not only see the PE investment Belle, Little Sheep and other business success stories, also witnessed the PPG, ITAT and other stars took a plunge the entire process. Consumption chain beautiful story, the risk is not small, investors need to be careful.

My Fair Lady, Marty:

consumption chain charm

as economic development, one of the troika, consumption in China has never been such intense attention, and no such burst of vitality as it is now. In the first 20 years of reform, people are busy with hard work, to China becoming a world factory, nearly ten years, as China gradually have the world's largest private savings and foreign exchange reserves, domestic consumption, also in an ever higher Long,ugg store, the Chinese seem to have become the wealthiest group of consumers, regardless of the Champs Elysees in Paris or Hong Kong, Harbour City, has a queue to buy LV bag of Chinese figure. China's consumer era has just started, from the international comparison, the U.S. consumption-GDP ratio has been stable at 68%, while China's income growth to lag behind as GDP growth, this proportion also from 38.7% in 2005 down to 2009 years, 36.1% (Figure 1). Boost consumption and domestic demand in the trend, consumption will be the next 5-10 years, the key to China's economic development efforts.

At the same time, with the per capita income growth and changes in consumption concept, the Chinese marked the third time in 30 years to upgrade the consumption structure, consumer topics from the basic food and clothing 80s, 90s appliances, developed to Since 2000, housing, cars, education and tourism. With this upgrade, especially the new generation is increasingly becoming the backbone of consumption, consumer products, content and service model is undergoing profound changes, the chain has matured and is becoming a mainstream consumer channel mode. From catering to the hotel, from retail to department stores, from health to education, chain has penetrated into all aspects of the Chinese basic necessities.

consumer industry is big and chain model is easy to quickly copy and can resist the economic cycle, therefore, investment and consumption chain industry in recent years become a PE industry fashion, song-Li-Si, the Han court, South Beauty, Millennium Star,uggs outlet store, increasingly The company received more PE investments, Smith Barney,uggs for cheap, seven days, Hunan love, Little Sheep, a large number of companies successful IPO, the PE has brought a lot of money in return. According to ChinaVenture, ,2005-2009, China invested a total of consumption chain 147 cases, involving an investment amount of 4.208 billion U.S. dollars; IPO at home and abroad over the same period the consumption chain 102, the amount raised a total of 10.14 billion U.S. dollars.

cross as many different angles:

concerned about the potential investment risks

However, the consumption chain model looks beautiful, and some limitations. Since the second half of 2008, a number of cases one after another failed investment: clothing sales was the largest chain of ITAT embattled; beautiful moment of PPG in 2009, completely closed; FUN 300 clothing stores all closed overnight. If the investment failed Internet companies may be able to return back a few computers; if investment and consumption sectors failed, perhaps only one has returned back beauty brand, consumption is not linked to investment risks smaller than the Internet.

surface, ITAT is the failure of flawed business model, expanding too fast, PPG is closing ad spending excessive funds in strand breaks, FUN closure is not operating properly, in fact, hidden behind these failures investment total consumption chain risk point.

weak brand. Consumption chain threshold is low, more space, more participants, both competitors quickly copy is also easy to imitate; well established brand is difficult, but the negative news has spread quickly, cause huge, in a domino effect, the consumer brand of chain has its weak side,cheap ugg boots, once the brand image reversed, would constitute a fatal injury enterprises. 2008's melamine incident, the value of 14.9 billion yuan in the Sanlu brand disappear, but become negative assets. PPG after the collapse of the huge amounts of money to build the brand in the court auction Shique nobody cares. In 2009, around Wang's Bee Park and false propaganda storm product, but also constitutes its great damage to the brand.

unreliable scale. The biggest feature is the ongoing chain shop, the scale effect, but this size is not always reliable, if the products, services or capital, poor management, the cost of expanding the scale of expansion will become, so size becomes reined in Enterprise rope. ITAT in the peak period of development, due to management and income do not match, often while shop side of the Hyatt, or the shop this month, next month off store. The reason, on the one hand, scale and management related. The development of chain operation to a certain size, the ability of the manager, sustained investment effort is a huge challenge. By the number of stores to 100 stores development, urban development as a regional single market, single product development for the series, during which the management is facing difficulties, far from the store with the increase year on year increase, especially in the expansion to 30 stores and over 100 shops, often comes across management bottlenecks, then management will reflect the level where the chain. On the other hand, related to size and profitability. Consumption chain class asset management business is generally light, but if it is too light and too fast in the marketing of assets, although once give birth to an amazing rate of expansion, but growth is often not only profitable, no matter how good the story can not guarantee success. Therefore, if there is no real profits and management capacity to support scale was not reliable, and often a small scale can lead to significant shrinkage, and even affect the money chain, threatening the survival of enterprises. Shenzhen Causeway Bay Department Store, once a shop in Dalian in arrears for electricity, resulting in more than 60 stores nationwide shut down. Even the giant home appliance chain Gome, in order to maintain profitability in 2009 also closed 100 stores.

restructuring costs. From the business structure of the consumer chain is often the initial approach to the individual business households registered operations, however, only to integrate the many individual shops centralized corporate enterprise, it has investment value. But in the process of integration requires not only a series of legal arrangements, but also a greater restructuring costs and uncertainty. Restructuring, if not handled properly, and may even lead to two undesirable results: first, a single store had no profit to make money, and because of the restructured management costs, tax costs, human resources, including direct costs; second, had a good single-operation shop quality deteriorated because of the original management system has changed. From the management structure, the consumption chain management of early stage to family-based, family-run shop a lot, if the governance structure in accordance with standard operation, may also generate additional contradictions and conflicts. Real kung fu in 2009 the two founders of the management of the outbreak of battle, is a typical case.

In addition, many early private consumption chain are mainly cash sales, easily the problem there is not standardized; its operation and management of the family also has a relatively strong color, the resulting problems associated with transactions worth investors are also concerned about the .

consumption chain financing often has a beautiful story, at least the number of stores now will be described, the number of stores to open next year, when the time how much profit there will be an exciting program, but if the rational thinking of the story behind the risk, relatively big. Look at a previous contact with the company, did not complete program is not a minority.

Math:

Aspect

key chain

then, PE chain how to study, and found a truly long-term value of the investment opportunities? Combine the characteristics of such enterprises can focus on \

for the chain, adding that the scale of the new shop in Happy Valley through the enclosure, drive revenue growth. Store expansion in the scale and speed business growth often become the source of the story, but also easy access to PE of all ages. When doing addition, the professional site management perspective is important, consumer goods chain store was not simply open the center in the pedestrian flow will be successful, the characteristics of products or services, audience targeting, rental costs and other effects are important factor.

subtraction, reflects the scale of the decrease under the effect of direct costs that scale with the expansion and increase brand awareness, a lot of fixed costs to manage the cost-based gradual downward can be transformed into variable costs, while companies will enhance the bargaining power, lower procurement costs, product or service will increase the gross margin level, so as to achieve increased scale, cost reduction rather than a virtuous circle.

multiplication, that is, the number of stores when the company reaches a certain size, its revenue and profit growth is no longer a simple arithmetic sum of a single store, its size and brand,uggs for cheap, channel and service forces will be reflected thus boosting the income of existing stores to achieve internal growth,cheap uggs, this growth can be old store revenue growth target to inspect.

division, is through the management level for all store operating costs decreased, reflecting the synergistic effect of the expansion and management of brand extension is the key in place, through the accumulation of management experience to enhance each store management level, allowing businesses to profit growth.

addition and multiplication are reflected in revenue growth, which is a new store additions bring the total revenue growth, multiplication refers to the scale of expansion on the basis of growth, in particular, to achieve revenue growth has lasted; subtraction and division reflects that there is cost control, subtraction is a direct cost, the division is operating costs. As a PE, not only to see the chain of addition and subtraction, multiplication and division should pay attention. Happy Valley enclosure is important, but the relationship between management and the scale of the same handle well, or will be caught up shop, into the game off store.

of the chain, the addition and subtraction is relatively straightforward and general business can be achieved through the expansion of the scale. And multiplication, that is, the natural growth of old shop income (generally see more than 3 years old shop), you can more directly reflect the influence of corporate brand, customer loyalty and the shop, select goods such as management ability. Chain generally around 50% gross margin, if the scale is large, strong bargaining power, gross margins can be higher, but, does not represent high net interest margins high, net profit margin but also by the impact of operating expenses. Enterprise net interest received by the division level, directly reflects the level of management, for example, whether there is unified and efficient logistics systems and effective manager, configuration and training staff are reasonable, the accumulation of these experiences can improve the level of cost control in enterprises to enhance profitability.

Therefore, in addition to addition and subtraction, multiplication and division to do an enterprise, the ability to comprehensively understand the chain on the inner edge is critical. If a company open new stores faster than its revenue growth came from the store, but lasted a little revenue and profit growth, and the seal of the general profitability of a single store, you can generally concluded that the basic part of its growth into type, is not stable, if no new investment, growth will stagnate, the risk would be greater. If a strong corporate profitability has lasted, and to maintain good growth, you can not believe that their business is very strong growth in investment has also increased investment will develop faster. Do multiplication and division, try to improve the company's profit curve, the level of profit under the same scale in Figure 2, the line I upgrade to the line II, is the key to the development chain.

team and management:

the real cornerstone of the chain

brand and scale, is the ability to chain the external performance, reliability and a certain degree with the non-deceptive; \But on the chain, the success of the \

consumption chain threshold is low, not high technology and financial barriers, but there is no policy barriers, and chain length, multi-node management, risk o'clock, in a perfectly competitive market, companies rely on management than other models later. Can be said that consumption chain is a completely industry-based management is a management, working slowly and deliberately in the industry, to expand its stores, merchandise procurement, shop furnishings, service standards, staff training and other aspects, both on the management of the stringent requirements, only the best practice management companies can survive and develop. The establishment of this series of management system and implementation of enterprise managers need to take the initiative to explore a long time, and continue to absorb other people's experience, this on its vision, mind and mentality made rigorous test. McDonald's founder Ray? Crocker (RayKroc) the autobiography named \

manager for the chain, the store reached a stage where the scale of the development, management chain extended, the management team, back-service system, trademarks, brand management, incentives, logistics management, product support,CHI Hair Irons, internal control and financial management on, should have a corresponding match, is a particularly important test, is also the PE chain in the study should be of concern. Mainly those who joined the company, management should be the focus of study. PE Do not be so-called asset-light, perfect models and the rapid expansion of the concept attractive, but should understand the growth, management and corporate profitability is the origin.

the arrival of the consumer in this new era, both the chain operators or investors, only in-depth understanding of the consumer chain of these characteristics, to understand and control the risks which can create their own beautiful story.

uggs

2010年8月7日星期六

Consumption chain the risk of a beautiful story ugg store

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