The home textile industry has recently handed over a report card that is not lacking in bright spots. According to the data of the National Bureau of Statistics, the operating income of home textile enterprises above designated size in the first quarter increased by 3.45% year-on-year, and the total profit increased by 7.31% year-on-year, and the industry as a whole achieved a good start.
However, in a recent interview with a reporter from China Textile News, some home textile companies admitted that business is becoming more and more difficult. The revenue of some listed home textile companies has declined year-on-year, which is at a low level in recent years.
Cartography | Zhong Yanjing
01
Facing market challenges
Among the leading enterprises, the performance of Luolai Life Technology Co., Ltd. (hereinafter referred to as "Luolai Life") has declined significantly. After the year-on-year decline in revenue and net profit in 2022, Luolai Life will not fully pull its revenue and net profit back to the growth channel in 2024. In the first quarter of this year, the company achieved operating income of about 1.088 billion yuan, a year-on-year decrease of 12.26%; The net profit attributable to shareholders of listed companies was about 89.4935 million yuan, a year-on-year decrease of 49.47%.
Hunan Mengjie Home Textile Co., Ltd. (hereinafter referred to as "Mengjie shares") declined in the first quarter of this year. During the reporting period, the company achieved operating income of 409 million yuan, a year-on-year decrease of 11.63%, and attributable net profit of 8.81 million yuan, a year-on-year decrease of 19.11%; The net cash flow from operating activities was 2.93 million yuan, a year-on-year decrease of 96.84%.
Every business encounters different problems. As a leading brand in the home textile industry, Luolai Life's overseas business is mainly distributed in the North American market, and the region is currently experiencing a slowdown in consumption, resulting in a decline in revenue growth. In addition, Luolai Life said that after the rapid development stage of the home textile industry characterized by demand, the market competition has become increasingly fierce, which has also had an impact on the company's business development.
The closure of stores is an operational reality of Mengjie in 2023. In 2023, the number of directly operated stores of Mengjie Co., Ltd. will be 386, of which 89 will be newly opened and 198 will be closed. For the closure of some directly operated stores, Mengjie said that the reason is that the operation does not meet expectations, the adjustment of shopping malls and the company's initiative to adjust the strategy.
It is not difficult to find that although the reasons are different, behind the pressure on enterprise operations, common reasons such as weak consumption, intensified competition, and changes in business models are reflected. In the face of challenges, leading home textile companies are trying to find a way to break the situation.
02
Seek a way out of the game
In the 2023 financial report, Luolai Life proposed to continue to strengthen its core competitiveness, continuously consolidate its position in the industry by virtue of its core competitive advantages, and improve its ability to resist risks. "The company will continue to pay attention to the international situation, grasp the development trend of the industry, and continue to promote the improvement of the product power, channel power, brand power and operation power of each brand, so as to promote the company to achieve high quality, stability and sustainable development, and maintain its leading edge in the market."
It is worth noting that Luolai Life focuses on continuing to vigorously invest in digital construction, improving the level of intelligence, and actively promoting technological transformation. "In 2024, the company will promote the informatization infrastructure of Luolai Smart Industrial Park, introduce advanced production equipment, and explore high-end intelligent technologies at home and abroad to further improve the company's production efficiency and product quality, and maintain the competitiveness of the industry."
In response to problems such as store closures, Mengjie said that it will continue to optimize and upgrade the channel strategy, scientifically evaluate the profitability of stores with "strategic layout" in large cities offline, and close or adjust them in a targeted manner. "Through the methods of 'big store layout, big store detonation, and zero business integration', the company will effectively improve the profitability probability and profit scale of large stores, and create a profit model of direct benchmark stores and large stores."
For the future development plan of the company, Mengjie said that the company will continue to implement the high-end strategy, continue to complete the upgrading of channels and terminals, promote the synergy of products, brands and supply chains, create strong momentum for the company's performance recovery, and accelerate into a new stage of development.
Although the net profit of Vosges Group Co., Ltd. (hereinafter referred to as "Vosges shares") exceeded 90.44 million yuan, a year-on-year increase of 263.13%, its revenue declined slightly. In the first quarter, the company achieved operating income of 1.317 billion yuan, a year-on-year decrease of 1.05%.
For the situation of "increasing profits without increasing income", the response of Vosges shares is to iteratively upgrade e-commerce products. Vosges said that the company plans according to the new image and new products of the online brand, and connects with ODM customers at any time to meet the needs of design recommendations in a timely manner, and assists the sales side to place orders for products.
On the one hand, the upgraded product architecture was sorted out and iterated, on the other hand, it developed popular products, inspected suppliers, and gradually established a database to provide guarantee for the simultaneous development of follow-up online and offline sales. The company focused on docking with major network anchors, and selected products for broadcasting in a targeted manner, accumulating resources for brand investment in the later stage.
03
Stay focused on innovation
Despite the changes in the market and the slowdown in the performance of sector enterprises, the overall upward trend of the home textile market has not changed. "R&D and innovation" is still one of the keywords of listed home textile companies.
On the one hand, home textile enterprises continue to develop and adopt new technologies, new materials and new processes to inject more scientific and technological content into home textile products. On the other hand, home textile enterprises pay more attention to personalization and diversity in design, and better meet the needs of young consumer groups for the fashion trend of home textile products through product design innovation and cultural connotation injection.
In order to build the company's core technology and empower product innovation, Luolai Life continues to increase R&D investment, focuses on the strategic positioning of "ultra-flexible bedding", and builds a super-flexible product system from three dimensions: ultra-flexible raw materials, ultra-flexible technology, and ultra-flexible finishing. At the same time, the Rholey Supersoft Research Institute will cooperate with partners in the technology ecosystem of the strategic alliance to complement each other's advantages and share technologies through cross-border cooperation, and the R&D results in each ecosystem will be combined with innovation and secondary research and development to cast the core technology of Rolai Supersoft. As of the first quarter of this year, the company has obtained a total of 242 authorized patents, 1,438 registered trademarks and 2,382 copyrights.
The key to the implementation of the high-end strategy of Mengjie is the continuous innovation and improvement of products. In recent years, Mengjie Co., Ltd. has cooperated with many outstanding designers at home and abroad, so that Mengjie brand can absorb creativity from all over the world and inject more aesthetic and fashion elements into products. In addition to working hard in design, Mengjie has also established industry-university-research cooperation with many universities and research centers at home and abroad to further explore new materials, processes and design concepts to respond to changing market demand.
Vosges integrates the concept of green, low-carbon and sustainable development into the development of new products. According to the financial report, the company continues to develop new products that meet market demand and differentiate from other brand products. The company will carry out systematic research and application of fashion trends and popular colors, develop differentiated products with differentiated materials, processes, styles and functions for the target market, and combine ecological and environmental protection materials, ecological and environmental protection technologies, certifications and product development to develop beautiful, high-quality and green products.
In this regard, the relevant person in charge of the China Home Textile Industry Association analyzed and pointed out that at present, the development of the home textile industry has entered a critical stage of new trends, new challenges and new opportunities, and enterprises need to find a new positioning, cultivate new advantages, take new measures, grasp the power of science and technology and industrial transformation, and achieve high-quality development. Although the mainland home textile industry is facing many challenges, it is still resilient as a whole. In the complex market environment, home textile enterprises must speed up the adjustment of the industrial pattern brought about by technological innovation, and obtain new competitive advantages through scientific and technological innovation.
The China Home Textile Industry Association suggests that relevant enterprises should continue to strengthen R&D investment, continue to strengthen the application of new technologies and new materials, accelerate the transformation of achievements and the construction of standard systems, and cultivate high-end talents.
Written by reporter Jia Rong
Editor / Marry