On the eve of the company's meeting, the secretary of the board of directors of Mao Geping Cosmetics told the Beijing Youth Daily reporter, "We received this news very suddenly" and "everyone is very busy this week."
After 4 years of silence, I suddenly went to the meeting
"Mao Geping Cosmetics" (Mao Geping Cosmetics Co., Ltd., hereinafter referred to as "Mao Geping Company") after 4 years of absence from the capital market, the first return to get the pass of the Issuance Review Committee, ushered in the end of the listing rumors.
Before that, it was the company's 2017 suspension of the IPO.
According to the official website of the China Securities Regulatory Commission, Mao Geping Company submitted a prospectus at the end of 2016 and declared an IPO on the main board of the Shanghai Stock Exchange. At the end of 2017, after accepting the CSRC's on-site inspection, the company voluntarily suspended the IPO. Since then, the company's IPO dynamics have not been updated, but the material has not been withdrawn.
Until the news of the company's meeting suddenly came.
(Photo: SFC official website)
The secretary office of the board of directors of Mao Geping Cosmetics told the Beijing Youth Daily reporter, "We received this news very suddenly" and "everyone is very busy this week."
As far as the stylist Mao Geping himself is concerned, due to the popularity of "out of the circle", the outside world is not unfamiliar with it.
As early as the Internet era, Mao Geping's makeup videos that are "especially suitable and can highlight the beauty of Oriental women" have gone viral on the Internet. In the old version of "Wu Zetian", he made a deep impression on Liu Xiaoqing's depiction of Liu Xiaoqing from a 15-year-old green girl to an 82-year-old twilight old man through makeup. After this drama, Mao Geping himself also became Liu Xiaoqing's royal makeup artist.
With his unique understanding of oriental women's facial contours and skin characteristics, Mao Geping has since embarked on the road of "Chinese makeup art master", "first-class image designer of the Ministry of Culture" and "stylist of the opening ceremony of the 2008 Beijing Olympic Games".
In addition to the well-known "makeup master", more details about Mao Geping's personality were rolled out in the prospectus as the company was about to go public.
His personal experience is actually quite inspiring, and he is a typical generation that started from scratch by relying on personal diligence and continuous improvement of professional ability. The company's prospectus shows that Mao Geping was born in the 1960s and has a technical secondary school education. Between the ages of 19 and 24, he worked for the Zhejiang Yue Opera Troupe. Between the ages of 24 and 26, he founded his own cosmetics company of the same name and an image design art school in Hangzhou, which are also the predecessors of the two major businesses of the upcoming Mao ge cosmetics company, makeup and training.
Mao Geping's wife, a former actor in the Zhejiang Yue Opera Troupe, later served as the principal of Mao Geping Image Design Art School, and is currently the vice chairman of Mao Geping Cosmetics Company.
As of the data disclosed by the company to the end of the first half of 2017, in the current entity to be listed, Mao Geping cosmetics company, Mao Geping himself holds 42.63% of the shares, the chairman of the company; his wife Ms. Wang Liqun holds 11.08% of the shares, and the husband and wife hold a total of 55.45%, which is the actual controller of the company.
Mao Geping's business
Mao Geping Company mainly does two major businesses. The first is the research and development and sales of skin care and makeup products, and the other is the vocational training of makeup skills.
In the cosmetics business, Mao Geping, who came from makeup, chose a business route based on makeup and supplemented by skin care. It has the "MGPIN" brand named after Mao Geping himself, the local high-end cosmetics brand, and the "Beloved Lifelong" brand positioned in second- and third-tier cities for women's consumption.
(Image source: company prospectus)
MGPIN and Favorite Life were founded in 2000 and 2008 respectively, and the two brands have differences in pricing, sales channels and target customers. All in all, MGPIN, named after the founder of the company, is the company's core brand for the high-end consumption level of first- and second-tier cities, the average price of products is between 300 and 450 yuan, the sales channels of this brand in addition to e-commerce, mainly the company opened in the mall direct counter.
As of the end of the first half of 2017, Mao Geping Cosmetics had a total of 135 department store counters in the country (127 self-operated + directly operated) and 27 distributors.
According to the company's financial report, from 2014 to 2016 and the first half of 2017, the cumulative sales of Mao Geping's two major cosmetic brands were 238 million yuan, 265 million yuan, 284 million yuan and 164 million yuan respectively, accounting for 89.03%, 85.61%, 85.32% and 84.11% of the company's main business income, respectively. It seems that the company's business structure and performance are relatively stable, and the growth of makeup sales is slow.
Among them, the company's directly operated and high-end MGPIN brand's main business income contribution ratio is more than 70% on average; the proportion of revenue of the distribution model's beloved lifelong brand continues to decline.
Or teach because of your skill. In 2000, Mao Geping, who had been running a cosmetics company for three years, began to create a makeup technology training school, and successively opened branches in Beijing, Shanghai, Chengdu, Chongqing and other 9 places outside Hangzhou. The training content is mainly based on makeup and styling design, and is divided into 6 main courses according to specific characteristics and hours (ranging from 1 month to 1.5 years), and the tuition fee ranges from 2500 yuan to 28800 yuan.
According to financial data, from 2014 to 2016 and the first half of 2017, the number of trainees in Mao Geping's makeup training business was 2278, 4119, 4145 and 3310, and the business income was 25.4843 million yuan, 39.0731 million yuan, 42.0896 million yuan and 26.6195 million yuan, respectively.
Although mao geping's makeup training business accounts for only a small part of the performance intuitive contribution , an average of only about 10% of the revenue contribution ratio during the reporting period , it seems that it is this business that has led to the company's years of queuing and silence after submitting the prospectus.
Problems and challenges
Time back to August 2017.
Mao Geping, which has been submitting the prospectus application draft for nearly 10 months, has received feedback from the CSRC's Review Committee. The question points to the compliance of Mao Geping's training business , the company's education business in the form of sub-branches and training schools.
Including whether the company has educational qualifications, whether the private training institutions operated by the company are legal and compliant, and whether there is a policy basis.
On September 11 of that year, Mao Geping replied to the above feedback and updated the draft of the company's prospectus.
After that, it is the company's 4-year "waiting period for the meeting".
On October 21, 2021, The long-dormant Mao Geping Company finally ushered in the company's listing review meeting, and finally got the wish. However, at this review meeting, the issue of the company's training business is still being concerned, inquired and asked by all parties to re-verify.
Mao Geping's prospectus shows that as of the end of the first half of 2017, the company's training business was mainly carried out in two forms - one is that the company opens private training colleges and universities, with schools as the main body for operation. This form is mainly in Beijing, Zhengzhou and Wuhan.
Moreover, Mao Geping Company is carrying out training business in the local area with another kind of - sub/branch as the main body.
According to the company, the reasons for conducting business in two different forms are mainly that the requirements of local policies for training business entities are different, and the specific industry norms have not yet been determined.
The essence of Mao Geping's training business belongs to the commercial private education and training industry, the industry department is the Ministry of Human Resources and Social Security, and the industry supervision department is the administrative department for industry and commerce.
The industry has historically been strongly regulated at the national level. If market entities want to open training institutions, they need to obtain multiple departments such as the Ministry of Civil Affairs, the Ministry of Human Resources, the Ministry of Social Security and the Administration for Industry and Commerce, and the company's assessment and certification of many aspects, including training venues, training content, teaching staff, fire safety and so on.
This series of qualification certification is difficult and long-lasting, so it is also a major entry threshold for the private training industry.
It is worth noting that according to the Law on the Promotion of Private Education, the Measures for the Administration of Commercial Private Training Institutions registered with the administrative department for industry and commerce need to be separately stipulated by the State Council.
However, since this measure has not yet been introduced, there is a specific compliance explanation for the management of the corresponding business. This also means that there is uncertainty about the compliance of mao geping's business.
For example, even in the 6 cities where Mao Geping claims to be allowed to carry out training business as a subsidiary/branch, there is still one case in which the Qingdao branch is explicitly stated by the local Ministry of Human Resources and Social Security that it "does not belong to its management" and is not issued a company's compliance business certificate.
Compliance operations cannot be proven, and there is a regulatory vacuum, which makes the future of Mao Geping's training business a considerable degree of policy risk. Even now, the compliance of this part of the company's business is still being questioned by the NDRC.
It is worth noting that due to the long queue time, the information disclosed in Mao Geping's prospectus has been long-term - the most recent company information and financial information need to be traced back to 2017. It is also for this reason that the new situation that has occurred in some companies in recent years has not been noticed.
Other findings
On May 17, 2021, a civil judgment by the Hongkou District People's Court of Shanghai Municipality showed that in September 2019, a natural person "Jiang Mou1" paid a total of 23,000 yuan of "tuition loan repayment and interest" when signing up for the course of Mao Geping Training Company, and also paid 9,800 yuan of "learning cosmetics that Mao Geping required to purchase at Mao Geping when enrolling".
(Source: Judgment Documents Network)
In August 2020, a civil judgment by the Chengdu Intermediate People's Court in Sichuan Province showed that when Feng, a natural person, signed the "New Student Enrollment Agreement" with Hangzhou Mao Geping Training Institution in October 2019, in addition to paying a total tuition fee of 15,800 yuan, he also paid two unknown fees of 9,057 yuan and 50 yuan on the same day.
In the above two available cases of Mao Geping trainees, a problem is shown - in addition to paying the prescribed tuition fees, the trainees also need to pay a lot of "cosmetic teaching aids" and other unknown fees.
In addition, the tuition loan and related interest rate issues mentioned in the case were not mentioned in the prospectus previously disclosed by Mao Geping Company.
In fact, as for the course fee of 15,800 yuan for Ms. Feng in "Case Two", the corresponding course could not be found in the prospectus of Mao Geping Company. The prospectus shows that the company's course fees range from 2500 yuan to 28800 yuan, except that there is no list price of 15800 yuan. As mentioned in the case, the cost of Ms. Feng's course "Makeup and Styling Course" is actually 13,800 yuan.
Regarding the need to train trainees to purchase cosmetics as teaching aids, Mao Geping Company did not explicitly reply. However, the company said in the prospectus that "in order to ensure the quality of teaching, the school adopts a standardized teaching quality monitoring system, that is, a unified teaching material, template, teaching aids and teaching process."
It is worth noting that the sales model of the company's makeup products shows that "training" has always been one of the channels for Mao Geping to sell makeup products during the reporting period, and the amount is not small - during the period from 2014 to 2016 and the first half of 2017, the company's makeup sales amount reached 22.218 million yuan, 22.2726 million yuan, 21.4773 million yuan and 14.6992 million yuan, respectively. The proportion of channel sales in each period of the company's reporting period was close to 10%.
According to Article 14 (Fee Management) of the Measures for the Administration of Shanghai Municipal Non-degree Educational Institutions (2015), civil non-educational institutions shall formulate fee collection items, fee refund standards and methods in accordance with law, do a good job of publicizing the work to the public, and perform the obligation to inform when enrolling and charging; and institutions shall charge fees in units based on the training cycle; if the training cycle exceeds one year, they shall charge fees according to the academic year; and shall not use discounts and other reasons to package or bundle pre-fees across training cycles or across academic years.
Under this provision, the standards and compliance of Mao Geping Training for the trainees' fee programs are worth questioning.
In fact, although the company's prospectus does not disclose the relevant information. However, in the past NDRC, the NDRC also inquired about whether Mao Geping's training had "forced or induced trainees to use consumer loans and purchased company products", and whether there was "forced or induced trainees or consumers to use 'beauty loans'", and asked the company's sponsors to verify and explain the basis and process of verification.
At present, the results of this issue have yet to be published.
23 years of entrepreneurship, 4 years of waiting, a day to pass, the listing of makeup master "Mao Geping", there are people who are pleased and cheering. But behind the celebration, don't forget the thousands of trainees who do makeup training in the company every year. Are their academic qualifications valid, are their tuition fees fair, and are their contributions voluntary?
Text/Beiqing-Beijing headline reporter Fan Hui Wang Yue
Editor/Fan Hui