Anta Returns To Extensive Growth Mode

Previously claimed to control the speed of opening shop.

Recently, it has been drying out the store expansion plan to the outside world.

Although the number of new stores in 600 this year does not seem to be large in Anta, this figure still equals the number of shops opened last year.

The industry believes that although Anta has gradually realized that scale expansion is not an effective means to increase profits, Anta has no other choice under the background of a sharp decline in corporate profitability.

Anta terminal image

A few days ago, Lai Shixian, chief operating officer of Anta, said that 600 stores will be opened in the mainland this year, bringing the total number of shops to 5300. It also denies that Anta's doubts about the positive effect of the Olympic Games on sporting goods sales are too optimistic.

Lai Shixian said that the shop is designed to make consumers more convenient to buy Anta, and the number of 600 stores is not radical.

Anta once tasted the sweetness of opening a store at a high speed.

A Anta who does not want to be named

To reporters, in order to speed up the opening up of stores, Anta distinguishes itself from other sports enterprises in the country in setting up a direct branch company in the whole country, and adopts the way of "provincial distribution agents + regional distributors" to develop the national sales network.

Under the guidance of these sales network construction strategies, the number of terminal stores in a short span of several years from hundreds to thousands, and then to thousands of homes, quickly occupied the three tier market.

It is in this way of development that Anta made even more profits than Lining in 2010.

Return to extensive growth mode

But it is worth noting that this expansion plan contradicts the position of Ding Zhizhong, chairman and CEO of Anta Sports Council not long ago.

At the beginning of August this year, Anta's semi annual financial data was fully reported. At that time, Ding Zhizhong said that there was still a risk of inventory and discount in the second half of the sports industry, so it would control the future order volume and shop expansion speed, and grow steadily.

Data show that in the first half of this year, Anta's turnover was 3 billion 934 million yuan, down 11.6% compared to the same period last year, gross margin was 1 billion 644 million yuan, down 13.7% compared with the same period last year, and net profit attributable to shareholders of listed companies was 770 million yuan, down 17% compared to the same period last year.

Semi annual report pointed out that the overall decline in financial data is due to high inventory and product discount, profits have been seriously affected.

In addition, Anta has foreseen the weakness of consumption during the reporting period, thus reducing the volume of shipments to distributors. This is also the reason for the serious decline in revenues.

At that time, a semi annual report released a note explaining the situation of Anta orders and single store operation in 2013. Anta said that the order volume of the first quarter of 2013, which ended in July, dropped by about 20%-30%, while the profitability of single store in the first half of this year also declined slightly.

Brand analyst Xu Ning believes that the statement made by Lai Shixian is opposite to the slowdown plan proposed in the semi annual report. I am afraid it is also forced to do so, because this year and even the future may not be a good economic situation. Under such circumstances, Anta's decision to make store expansion is also a normal move. After all, China's two or three line cities have huge market development space.

"Although the profitability of single stores is slowing down, the cost of opening stores in the two or three tier cities is not very high, and increasing the volume of shops can still increase profits," Anta said.

In Xu Ning's view, although the speed of profit raising is limited, under the background of collective sports brands falling into a trough, Anta has to return to the extensive growth mode which has always relied on it.

At the same time, Anta is also seeking diversified layout, trying to get rid of the current predicament of declining performance.

A few days ago, Anta said that apart from the production and sale of sports shoes, it also began to set foot in the garment business and make the products more diversified. "We are already one of the four brands in the mainland," said Lai.

In addition to focusing on the development of Anta brand, Anta children's series is developing this year. It is expected that the business will account for 5% of the turnover in 3 years.

Xu Ning thinks Anta expands.

The brand is also consistent with the international mainstream sports brand development. The high-end plate mainly adopts the way of acquiring international mature brands. This brand is mainly aimed at low-end brands, which is likely to become an important growth point for Anta in the future.