Shoes and clothing business layout "One Belt, One Road" market

Under the background of the “Belt and Road Initiative” initiative, textile and garment enterprises have set up factories, investment, acquisitions, etc., and laid out national and regional markets along the line, seeking effective integration of the industrial chain in the global scope. Some textile and apparel companies have achieved performance growth.

Achieve performance growth

Factors such as increased brand awareness of consumer groups and rising domestic production costs have prompted related companies to “go global” to find opportunities through overseas mergers and acquisitions and overseas establishments.

Taking Jiangsu Sunshine as an example, the company plans to establish a textile and garment production base in the industrial park of Adama City, Ethiopia. The total investment of the project is 350 million US dollars, and the construction period is expected to be 1 year. It is estimated that the project can realize an annual business income of 241 million US dollars and a total annual profit of 47.136 million US dollars. After the project is implemented, it can produce 10 million meters of wool worsted fabrics and 1.5 million sets of suits.

The company said that setting up a production base in Ethiopia will help reduce labor costs and reduce international logistics costs. This will help the company to continuously expand the international market, further improve and enhance the company's industrial development layout, and further enhance its competitiveness.

Another example is Ruyi Group, which benefited from the expansion of the company's “One Belt, One Road” transformation and upgrading of intelligent manufacturing projects and the drive of international M&A projects. The overall operation of Ruyi Group was good and steadily rising. In 2016, the Group achieved operating income of 29.1 billion yuan, a year-on-year increase of 27.74. %; net profit was 2.5 billion yuan, an increase of 259.74%.

According to the world clothing and footwear network, Ruyi Group has arranged 10 industrial parks in the countries and regions along the “Belt and Road” with a total investment of more than 30 billion yuan. Wang Qiang, executive director of Ruyi Group, said that since the “Belt and Road Initiative” initiative, Ruyi Group has accelerated its layout in countries and regions along the route. The group has built industrial parks in Ningxia and Xinjiang. In 2016, in order to solve the energy shortage problem in Pakistan, the Group and Huaneng Group jointly invested in the construction of the Pakistani Sichwal coal-fired thermal power project. At present, the project has become one of the “priority implementation” energy projects of the China-Pakistan Economic Corridor.

Listed companies such as Vignas and Gloria expand overseas markets by acquiring international brands.

In November 2016, Vignas announced that it plans to issue no more than 159.4 million shares at a price of not less than 27.61 yuan per share, raising no more than 4.4 billion yuan. Among them, 4 billion yuan was used to acquire a 90% stake in Teenie Weenie. Teenie Weenie is a famous mid-to-high-end clothing brand in South Korea and currently has 1,425 stores. Among them, direct sales stores accounted for 91.65%. GF Securities said that the acquisition of Teenie Weenie by Vignas will enrich the company's brand matrix and create synergies in design, production and sales, and will significantly increase the company's profits. In the first quarter of 2017, Vignas achieved operating income of 311 million yuan, a year-on-year increase of 63.90%. The net profit attributable to shareholders of listed companies was 28,650,800 yuan, an increase of 31.79%.

Since 2015, Ge Lisi has acquired a number of European and American luxury brands. Benefiting from the acquisition of the German brand LAUREL brand and the US luxury brand Ed Hardy sales revenue increased, the company achieved operating income of 339 million yuan in the first quarter of 2017, an increase of 88.37%, the net profit attributable to shareholders of listed companies was 60,311,800 yuan. It increased by 153.15% year-on-year.

Adapt to market changes

According to data released by the General Administration of Customs, textile and apparel exports have shown a steady upward trend in January-March 2017. Among them, the export of textile products was 160.378 billion yuan, up 7.5% over the same period of last year; the export of clothing products was 218.201 billion yuan, up 6.2% over the same period of last year; the export of footwear products was 67.142 billion yuan, compared with the same period of last year. It rose by 12.8%. According to industry insiders, the downturn in foreign trade in the textile and apparel industry has been reversed to some extent.

As of the first quarter of 2017, a total of 54 textile enterprises above designated size have invested in various projects in Southeast Asia, Africa, Oceania and Europe. A number of companies will incorporate investment along the “Belt and Road” into the global industrial chain.

Tong Jisheng, Chairman of Shanghai Textile Group, said that the Group has summarized its global strategic layout as “African Raw Materials, European and American Design, Asian Processing, China Integration, Global Sales”, and expanded global industrial production capacity by building raw materials, manufacturing, sales and distribution bases overseas. , industrial chain layout.

In 2016, the four US subsidiaries of Shenergy had a total profit of 718.76 million yuan, accounting for 66.05% of the total profit of foreign trade business. Shenergy is a listed company of Shanghai Textile Group.

Compared with textile companies actively deploying the global industrial chain, the “Belt and Road” countries and regions in the shoe and apparel industry have a longer history.

Taking the sports shoes industry as an example, in 2009, Li Ning Company laid out the US and Southeast Asian markets and tested the overseas market, but the results were not satisfactory. And Anta, 361 degrees and other companies through the acquisition of foreign brands to layout overseas markets. In 2009, Anta took over the operation of the FILA brand in China from Belle International. In 2013, 361 degrees reached an agreement with Finnish sporting goods company OneWay to form a joint venture company to jointly expand the outdoor market.

Analysts in the footwear industry said that in recent years, there have been some changes in the industry as a whole, such as the rise of e-commerce, the dominant concept of fast fashion consumption, the longer incubation period of shoes and apparel brands, and the emergence of overseas investment. When the shoes and apparel enterprises are planning the “One Belt, One Road” national and regional markets, they should pay attention to the changes in the consumption habits, income levels, and consumption concepts of the target groups. Countries and regions along the route have advantages such as relatively low labor force, low tariff costs, and strong consumer population, but they also need to pay attention to differences in legal systems and cultural customs. In overseas mergers and acquisitions, we must pay attention to improve management level, strengthen brand cultivation, and improve the synergy between acquired assets and enterprises.

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