Text | Jin Wei
50 billion, 200 billion.
On February 1, Amer Sports, the parent company of Arc'teryx, was listed on the New York Stock Exchange in the United States at an issue price of $13 per share, raising a total of about $1.365 billion. On the first trading day, Amalfen Sports' share price rose 3.08% to close at $13.4 per share, with a total market capitalization of $6.492 billion (about 46.6 billion yuan). As of April 19, the market value of Amalfen Sports was 7 billion US dollars (about 50.6 billion yuan).
What many people don't know is that Amalfen Sports has been owned by Anta, and its listing has also become the first Chinese concept stock IPO in the Year of the Dragon.
On March 26, ANTA Sports released its 2023 annual financial report, with revenue up 16.2% to RMB62.4 billion, gross profit margin up 2.4 percentage points to 62.6%, and net profit of RMB10.24 billion, up 34.86% year-on-year.
In the Chinese market, Anta has surpassed Nike in terms of revenue and has become the largest sports brand in the Chinese market. After the release of the financial report, Anta's Hong Kong stock market started a new round of gains, and as of April 19, the total market value of Anta Sports reached HK$237.4 billion (RMB 219.4 billion).
Whether it is Amalfen or Anta Group, there is a Fujian man standing behind him: Ding Shizhong.
On the 2024 Hurun Global Rich List, Ding Shizhong, the helmsman of Anta, is the richest man in Xiamen with a personal net worth of 38 billion yuan. followed by Ding Shizhong's brother Ding Shijia, sister Ding Yali and cousin Wang Wenmo, with a net worth of 37 billion yuan, 12 billion yuan and 11 billion yuan respectively, ranking second, fifth and sixth on the Xiamen rich list.
Ding Shizhong single-handedly not only lifted the entire Ding family, but also held up the influence of Chinese sports brands in the world.
Fishermen's children, a global dream
"To be the world's Anta!" Ding Shizhong's words more than ten years ago have gradually become a reality today.
Many people don't notice that some familiar high-end fashion brands have already been taken over by Anta, such as: FILA, Arc'teryx, Wilson, etc. In particular, the recent successful listing of Arc'teryx's parent company has given Anta more material about the "World Dream".
From a small workshop in Jinjiang, ANTA has become the No. 1 group in China and one of the top three in the world, with 20 sportswear brands. This Chinese-style entrepreneurial myth story also starts from a fishing village in Jinjiang.
Jinjiang is surrounded by the sea on three sides, with a permanent population of 2 million, Ding Shizhong was born in a fishing village in Jinjiang in 1970, and Ding Shizhong's father made a living from fishing.
Jinjiang's shoes began to sprout at the end of the 70s, when they mainly did processing for international brands, and a number of small workshops appeared. In the 80s, Ding Shizhong's father also co-founded a small workshop for OEM shoes, and Ding Shizhong dropped out of school to help at home because of his poor reading performance.
When he was 17 years old, Ding Shizhong took 10,000 yuan and 600 pairs of shoes to Beijing to sell, after several encounters his shoes got the opportunity to be put on the shelves for trial sale, with the advantage of low price and good quality, his shoes sold well, and then he also opened a wholesale point while the iron was hot.
By chance, he found that the price of the same shoe could be multiplied several times as long as it was labeled, and at that time, foreign brands entered China one after another, and they often sold them at a higher price by relying on their brand advantages.
Ding Shizhong was determined to create his own brand, and after a few years in Beijing, Ding Shizhong returned to Fujian to convince his father to make his own brand.
"Start a business with peace of mind and be a down-to-earth person. In 1991, Ding Shizhong gave his company the name "Anta". At first, Anta was still mainly OEM, but gradually began to lay out franchised stores and rapidly expanded the market.
In 1999, Ding Shizhong came up with the idea of inviting a spokesperson, but the endorsement expenditure did not win everyone's support, and he tried his best to sign the table tennis world champion Kong Linghui at a price of 800,000 yuan. However, Kong Linghui was signed as a spokesperson, but there was a lack of platform promotion.
When he was at a loss, Ding Shizhong decided to gamble again, and he invested 3 million to let Kong Linghui appear on CCTV, and quickly made Anta famous. It is precisely by virtue of the method of "sports star + advertising bombardment" that the "Jinjiang series" shoes began a vigorous "brand-making" movement in 2000, and in the following years, Anta continued to develop steadily by sponsoring the CBA league and signing NBA stars.
In 2007, ANTA was successfully listed on the main board of the Hong Kong Stock Exchange. In the first year of listing, Anta achieved revenue of RMB1.25 billion, with a growth rate of 139.12%, and began a round of rapid development.
Ding Shizhong is not satisfied with a single brand, but hopes to build a multi-brand empire.
Ding Shizhong once said: "If you want to be an international brand, it is difficult without 30 years of precipitation, but you can achieve a rapid leap through acquisitions." ”
Ding Shizhong's eyes are not only limited to China, but also to the world.
In 2009, Belle's FILA was in a state of serious loss, when FILA had only 50 stores left in China, with a loss of 32.18 million, but it was favored by Anta.
In Ding Shizhong's view, international, high-end, fashion, sports, and functionality are the elements that ANTA values in acquiring brands. Anta spent RMB460 million to buy out FILA's trademark use rights and franchise rights in Greater China.
In order to fit FILA's high-end positioning, ANTA changed the wholesale model that was common to sports brands in the past, and spent three years recycling stores from dealers one by one and changing them to direct sales. The direct sales model allows brands to fully understand consumer needs.
At the same time, Ding Shizhong asked designers to constantly iterate on styles according to the needs of Chinese consumers, and the popular trendy shoes featuring "dad shoes" have impressed a large number of young people who are chasing trends.
A series of reform measures have made FILA sell out, and FILA's sales in China have grown rapidly, becoming the leader of high-end sports footwear.
In 2013, FILA successfully broke even, and the following year, FILA became profitable. According to the financial report data, in the first half of 2023, FILA contributed 41.3% of the operating income of the entire ANTA Sports, and its revenue proportion is close to that of the parent brand of ANTA.
At the time of the inventory crisis in the sports industry, FILA, which has a direct sales model, has stronger control over channels and terminals, so it can come up with a more flexible response plan. By 2020, FILA contributed 50% of the revenue of ANTA Group, and has been at the leading level in the industry in terms of revenue capacity per store.
FILA, from a company with a loss of tens of millions of yuan, has become a fashion and sports brand with a revenue of more than 25 billion yuan, which has verified Anta's operational strength. Ding Shizhong believes that Anta's sales channels and terminals can revitalize the acquired brands, and FILA's practice confirms Ding Shizhong's thinking.
"Take" out a world movement empire
In 2015, Anta acquired Sprandi, a British outdoor and mountaineering brand. In 2016, Anta invested RMB150 million to establish a joint venture to operate Descente, a high-end ski brand in China. In 2017, Anta acquired Kingkow, and in the same year, Anta established a joint venture to operate the outdoor brand Kolon Sport in China.
However, the biggest challenge for Anta in global acquisitions comes from Amalfen.
In 2019, the largest cross-border merger and acquisition in the history of China's footwear and apparel was born, and Anta completed the acquisition of Amalfen Sports with an external consortium at a premium of 43%, and the investment consortium spent 4.66 billion euros, equivalent to 36 billion yuan.
Founded in 1950, Amalfen Sports is a Finnish sporting goods company headquartered in Helsinki, Finland. It has a number of high-end brands such as Arc'teryx, Salomon and Wilson, covering outdoor, skiing, tennis, golf and other sports fields, with products sold to more than 100 countries and more than 10,000 employees worldwide.
At that time, Anta's acquisition was more questionable: on the one hand, in 2019, Amalfen Sports lost 1.6 billion yuan for the whole year. On the other hand, in 2018, ANTA Group's annual revenue was only RMB24.1 billion, with cash and cash equivalents of approximately RMB9.3 billion. The outside world said that Anta was expensive, and this would be Ding Shizhong's most expensive mistake.
"This is the most important decision I've ever made since I started my business. Ding Shizhong said frankly in an internal letter to employees in 2019.
For Amalfen Group, which is also in a loss-making state and owns a number of high-end brands, Ding Shizhong took over and started a new round of operation, transforming from brand independent operation, brand positioning, strengthening direct sales, and penetration in Greater China. In the end, Amalfen Sports spun off the non-core brands Mavi, Precor and Suunto, and operated with the three brands of Arc'teryx, Salomon and Wilsheng as the core.
For the Arc'teryx brand, Anta has set higher business goals for it, targeting the high-net-worth market, and constantly creating the concept of "sports luxury" to the outside world, with sports shoes and clothing costing thousands of yuan. Catching up with the blowout outbreak of the domestic outdoor market, China's middle-class and high-end people are increasingly pursuing lightweight jackets, and the Arc'teryx brand appears densely in these people, often difficult to find, and lululemon, Archaeopteryx and Salomon have gradually become a "middle-class three-piece suit".
As of September 30, 2023, the number of self-operated retail stores of Amalfen Sports exceeded 330, an increase of about 69% compared to 2019. Taking Arc'teryx as an example, Anta has opened 31 new self-operated retail stores of Arc'teryx after taking over, and at present, Arc'teryx has 63 self-operated retail stores in China, accounting for nearly half of the total number of stores in the world. In 2018, Arc'teryx had 14,000 members in China. By the end of September 2023, the number of Arc'teryx members has exceeded 1.7 million, a more than 100-fold increase.
In terms of performance, from the first full fiscal year of 2020 to 2022, Amalfen's revenue was US$2.446 billion, US$3.067 billion and US$3.549 billion, respectively, with a compound annual growth rate of 20.4%, and the gross profit margin increased from 47% to 49.7% during the same period.
In 2022, Amalfen Sports was included in ANTA's "globalization" strategy. After Amalfen goes public in the United States in 2024, it will become an important driving force for the globalization of "Anta Group".
After acquiring many brands, Ding Shizhong's pace has not stopped, in his words, "goods can be made quickly, but brands can't." In 2024, Anta completed another acquisition, that is, the acquisition of a 75.13% stake in China's local brand MAIA ACTIVE, which mainly makes yoga sportswear.
As early as 2021, ANTA Group also set its strategic goals for the next 10 years as "single focus, multi-brand, and globalization".
In January 2024, Ding Shizhong made this summary at the annual meeting of Anta Group: "When we go long with brands, we need to use different brands to meet the needs of consumers. Today's brands that do well in the world are all vertical brands that are deeply engaged in a market segment. "M&A can quickly expand ANTA's market share and brand influence, especially in the international market. M&A can bring more brand portfolios and product lines, thereby enriching ANTA's product lines and brand image and improving market competitiveness. ”
Ding Shizhong's next goal is to become "the world's Anta", he said in his speech: "When Anta is the first in China, why should I propose multi-brand and globalization? Because I see that China's sportswear industry does not yet have a world-class enterprise." ”
On March 6, 2024, ANTA took the launch of the Irving Generation (basketball shoes) as an opportunity to start the process of leveraging the U.S. market. "Owen can bring the voice of the brand to the United States and the world to consumers who ANTA is. ”
Anta buys, buy
Ding Shizhong, who has been making shoes for 30 years, is finally one step closer to his biggest dream of "building a world-class brand".
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