Text | Hua Shang Tao Li Wu Su
Under the epidemic, the days of the originators of the Sino-US tide brand are not good.
Wangfujing Apm's gap shop closed to adjust, while the same street in the Oriental Plaza I.t also door to rowl.
The clerk said that after the epidemic, in-store consumption did not rebound as expected.
In fact, the i.t, the former "originator" of domestic tide brands, goddess Qiu Shuzhen and Maggie Cheung, has fallen into a business crisis.
The so-called "i.t" is not it in the Internet, but the abbreviation of "income team", which originally means "money-making team". But the reality is that i.t is becoming less and less profitable.
Recently, i.t released its financial report showing that for the financial year ended February 29, 2020, the company's revenue was HK$7.719 billion, a decrease of 12.6% year-on-year, gross profit was HK$4.734 billion, a decrease of 16.1% year-on-year, and a net loss of HK$746 million.
You know, this is not the first time that the i.t brand has experienced a performance loss. In August 2019, i.t said it had a net loss for the six months ended August 31, 2019.
In April 2020, i.t issued a profit warning, due to the business shock in Hong Kong and Macao, coupled with the impact of the new crown pneumonia epidemic, the originally weak sales market was aggravated, and the Group's net loss for the whole fiscal year was not less than HK$300 million.
Looking at it now, I.T's annual net loss is 400 million Hong Kong dollars more than expected in April, which shows the severity of the situation.
In fact, the i.t brand has developed rapidly before, and was once recognized as the "originator" of the tide brand in the industry, holding the two brand lines of i.t and i.t. Among them, most of the fashion brands operated by i.t are high-end luxury brands and designer brands from all over the world, while i.t focuses on young products, mainly selling young fashion brands in Europe, Japan and South Korea.
The media said that overall, the i.t brand matrix is rich, covering luxury, light luxury, the public and other consumer classes. At the same time, behind I.T, there are two "goddesses" in Hong Kong, Qiu Shuzhen and Maggie Cheung.
The founder of i.t is Shen Jiawei, who earned his first bucket of gold by selling parallel goods, founded i.t in 1988, and married sexy actress Qiu Shuzhen in 1999. For her husband's career, Qiu Shuzhen fully supported, not only took out all her savings, but also often flew to Europe, Japan and South Korea to pick up goods for the company, and personally endorsed and stood for I.t.
Around 2000, Shen Jiawei invited actress Maggie Cheung, who had no design experience, to be a designer for i.t. With Maggie Cheung's huge influence in the Chinese-speaking world, i.t's popularity has soared, and its products are highly sought after by fans and users.
In 2005, i.t Group was listed in Hong Kong, and Shen Jiawei became a clothing tycoon, representing more than 300 fashion brands at its most beautiful. Qiu Shuzhen also benefited greatly, and in 2011, i.t's stock price rose, and her net worth exceeded HK$2 billion, which was eye-catching even among Hong Kong stars.
Especially around 2014, i.t increased its size to the mainland market, maintaining the opening speed of 51 new stores per year, obtaining a rolling source of revenue, and its revenue exceeded HK$8 billion for the first time in 2017.
With the help of the two goddesses and the attack of the mainland market, a huge synergy has been formed, and I.t has gradually entered the peak.
However, with the opening of more and more physical stores, i.t has formed a path dependence: the online business that was laid out in 2011 has been slowly weakened, the physical store business has been invested heavily, the cost has risen rapidly, the customer flow has been eaten away by e-commerce, coupled with the critical blow of the epidemic, i.t has lost a lot of money, which has become a natural thing.
Another important reason is that the i.t tide brand business is "besieged" by other tide brands.
In this field, more new brands have emerged, such as Chen Guanxi's clot, Yu Wenle's madness and European and American star trend brands, while mainland brands such as Li Ning, Anta, Peacebird and Heilan Home have also made efforts to the national tide. The emergence of these competitors has greatly diluted the market that i.t originally occupied.
A fashion industry investor bluntly said that in the face of the trend of domestic clothing companies to do fashion brands, whether it is channels or prices, i.t brands do not have an advantage.
Whether it is the parallel goods of that year or the later i.t, Shen Jiawei's core logic is the information difference - using the mainland and external fashion trends out of sync, arbitrage.
But now the logic of the business is different. Locking on the increasing speed of fashion information circulation among young people in the mainland, it is impossible to have the information difference of 20 years ago, and even the information gap between the first and second tiers and the sinking market has been swept away by the Internet.
Moreover, Weibo and Xiaohongshu are replacing the value of i.t.
Source: Snowball
Today, i.t's official website is undergoing discount sales, "some goods are sold at a 50% discount", and as of June 11, 2020, i.t's stock price is 1.33 Hong Kong dollars per share, with a total market value of 1.590 billion Hong Kong dollars, which has seriously reduced Qiu Shuzhen's wealth.
It is worth noting that I.t's predicament today is not just a business problem.
Affected by the storm and the superposition of the epidemic, in order to stop the bleeding in time, i.t Group closed 28 loss-making stores in Hong Kong and Macao in one year.
i.t's decline in Hong Kong didn't start last year.
Between 2011 and 2013, the group opened 117 additional independent stores in Hong Kong. But as early as the 2011 annual report meeting, the group's president Shen Jiawei revealed that he was interested in changing the practice of rapid store expansion. Kwong Kwok-yu, then Financial Director of i.t Group, said: "The local consumption power is shrinking, the number of people coming to Hong Kong is also decreasing, in order to attract passenger flow, we have increased our promotional efforts, which has also led to a significant reduction in our gross profit. ”
According to insiders, 70% of I.T's sales in Hong Kong actually come from mainland tourists who "travel independently".
Of course, i.t group also has more than 800 stores, the epidemic prevention and control situation is slowly improving, if it can integrate online and offline business, reactivate brand influence, i.t still have the opportunity to "turn against the wind".
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