As an old Chinese saying goes, “At the age of 40, one has no doubts about the world.” Facing fierce market competition, Chinese brand Bosideng is steadfast in its judgment and decision about future development. On the basis of strong global production and supply systems and a large consumer base, Bosideng welcomes the arrival of a new consumer market with maturity and wisdom.
Satisfactory financial statements indicates strong growth of Bosideng
Bosideng International Holdings held Press Conference on Annual Financial Report for the Year 2017 in Hong Kong on June 29. According to the report, the company's revenue in the past year reached RMB 8.88 billion, up 30.3% year-on-year. Net profit grew more than 50% to 57.1%, exceeding the expected 50%. Former King of Down Bosideng has roared back with strong growth.
According to the report, Bosideng’s down jacket business remains the most important source of revenue, accounting for 63.6% of the Group's total revenue. In addition, thanks to increased orders from key customers, the OEM business is on the rise, accounting for 10.6% of the Group's total revenue. After acquisitions of two women's clothing brands KOREANO and KLOVA, Bosideng’s women's clothing business increased substantially by 85.4%, and comprehensive benefits were improved greatly. At the same time, the multi-brand clothing business is maintaining a good momentum of development.
Not only that, Bosideng has surprised the market many times in the past three years, with a net profit increase of 39.5% in 2016 and 50% in 2017. It is easy to infer from Bosideng’s business landscape with the four segments and business growth for several consecutive years that it has succeeded on all fronts.
This year marks the 10th anniversary of Bosideng's listing. These remarkable achievements will help fuel the company's efforts in brand internationalization and capital operation, and bring more benefits to the shareholders. Mr. Gao Dekang, Chairman of Board of Directors and President of Bosideng, announced at the conference that the Board of Directors will pay 10th Anniversary of Listing special dividends of HKD 0.025 per share in addition to the annual dividends of HKD 0.035 per share, as a reward for the trust and support of the shareholders over the years.
As Mr. Gao Dekang pointed out, the reason for Bosideng’s return to a path of business growth is contributed to its ability in seizing the opportunities presented by consumption upgrade on the domestic market, which has driven the company’s timely changes in strategies and policies. With a clear development direction, Bosideng makes continuous efforts in innovating and improving the product quality to solidify the stable and healthy development of the down jacket business. Furthermore, it has taken actions to fully upgrade channels, brand image and sales operation. All these steps have resulted in an impetus and guarantee for the company to prosper.
Bosideng is gearing up to upgrade with a reinvented brand
The Reform and Opening-up policy was adopted 40 years ago in 1978, when Bosideng was founded. Of the same age as the policy, Bosideng adventured to build the kingdom amid the tide of internal reform and opening-up to the outside world.
In 1995, Bosideng was instantly sold out once there were new arrivals on sale. With sales of 680,000 down jackets and a market share of 16.98%, Bosideng became China’s King of Down Jackets. In 2006, one third of the world’s down jackets came from Bosideng, which was unprecedented. For the 2006 Turin Winter Olympic Games, it was the first time that athletes of the snow events of the Chinese Team were sponsored by a Chinese company. Appearing on the international stage in a Bosideng down jacket, Xiaopeng Han won the Gold Medal in skiing. In 2007, General Administration of Quality Supervision, Inspection and Quarantine awarded Bosideng the Certificate of World Famous Brand. In the same year, Bosideng was listed on the Hong Kong Stock Exchange, the first down jacket maker to be listed.
However, the well-known Bosideng was faced with new challenges on the commercial market in recent years. On the one hand, Fseason and sportswear brands have entered the down jacket market to take a bite of Bosideng’s market share; on the other hand, as its brand communication declined year by year, Bosideng faded out of the public sight, as if in seclusion. In contrast, a range of new clothing brands emerged to take money out of consumers’ pockets.
Making changes is the way to stay forever unchanged. Even Bosideng, which has become an industry leader, is confronted with the fact that the market and consumers have changed. Transformation and upgrading is the only way to grow a company. As Mr. Gao Dekang, Chairman of Board of Directors and President of Bosideng, stated in his judgment about the development direction of the company, "We’ve come to understand after 45 years in business that a brand must change as the times change. We can only stay ahead in times of change by learning lessons from failures and drawing on experience of successes, embracing changes, and making continuous efforts to improve communication with consumers.” judges the development direction of the company.
Encouragingly, Bosideng has become deeply aware of the importance of brand upgrading. Guided by the competition strategy adopted this year, Bosideng strives to win the war of market competition and regain its lead in the industry by amplifying the competitive advantages of the brand and reviving brand awareness.
In March, Bosideng announced a new strategy at the Franchisee Conference, which was held to deepen cooperation with more than 400 franchisees nationwide. Bosideng also announced that it would invest heavily in building brand, upgrading product quality and design, developing channels, and upgrading stores to reinvent itself as the Down Jacket Expert, conquer the RMB 100 billion market. Bosideng is committed to becoming the first choice of down jackets for 7.5 billion consumers worldwide.
Bosideng has devoted a lot of effort to product development with regards to the main business down jackets. The Extreme Coldness collection and Windbreaker collection that Bosideng released last year won market recognition. The former, consisted of down jackets with down content of 90% and incorporated with popular fashion elements, is no longer outmoded as they used to be, and is able to withstand extreme cold conditions in -30 °C. It has been successfully taken to China’s northernmost place Beiji Village. After taking into account the aesthetics of down jackets, instead of the usual puffed-up look, the latter is able to deliver fashion and slim fit, meeting the expectations of most consumers about down jackets. This year, on the basis of existing high-quality products, the company will continue to strengthen its professional advantages by integrating prospective premium resources worldwide, continuing to upgrade product quality and promote R&D and fashion design, and building core competitiveness of products, including upgrading fabrics, down, wool, accessories and production procedures. Bosideng will also create collections in collaboration with internationally renowned designers to manifest the brand's international status.
In relation to channel upgrading, Mr. Gao Dekang, Chairman of Board of Directors and President of Bosideng, believes that for brand transformation to be successful, the business districts where the stores are located, locations and interior design of the stores should match the brand positioning. Stores with low sales should be closed without delay. New stores can only be opened after new locations are selected and assessed. To increase market share and company revenue, efforts should be made to improve sales productivity and brand recognition. At the same time, the company will focus on investing resources to expand mainstream channels of the times in line with its strategy this year, and employ top French image experts to design its stores and upgrade store image. With regards to franchisees, Bosideng will also build the strongest support team for franchisees in history to help them grow.
Mr. Gao Dekang is steadfast and confident about the idea “brand is the core competitiveness for the development of a company”. He said that it has taken Bosideng 45 years to become a down jacket expert that sells well in 72 countries such as the United States, France and Italy, getting chosen by over 200 million people worldwide. An expert must be forward-looking, and must make unremitting efforts to make improvements and corrections. Bosideng should follow the tide of the times, revive the brand and focus on the core business of down jackets. In order to win the hearts of consumers and acquire enduring core competitiveness, Bosideng should dig deep into the brand's intangible assets, increase efforts in brand promotion and establish emotional connections between brand and consumers.
Global Down Jacket Expert, Bosideng’s journey of development
With 40 years of experience on the market, in addition to seeking brand transformation, Bosideng also attaches importance to promoting company growth through the combination of high-quality products and efficient operations management.
Executing strict internal quality control, Bosideng has been devoted to the development, design and production of down jackets for 45 years. Completion of each down jacket must go through more than 150 procedures. The high-quality products are credited to the attention paid to craftsmanship and techniques. Whether it is extreme coldness, friction or boiling water, Bosideng down jackets has passed these extreme tests, which has won over the domestic market.
Bosideng has always been active in expanding abroad. Making the first step towards the international markets. Bosideng entered the Swiss market in 1999. In 2014, it entered Italy and made its debut at the Milan Expo. In 2016, it released a capsule collection created by international designers, connecting its international status with the domestic market.
In order to further improve the efficiency of operations management, Bosideng uses Alibaba Cloud's Internet middleware technology to make the business information of core stores nationwide sharable. Bosideng Retail Sharing Service Layer, which is consisted of a global shared user center, a transaction center, an inventory center and an order center, is established. Then, upper-level business modules are built on the basis of shared middleground. These business modules are flexible to adapt to different business projects and different business processes.
Through the construction of the Retail Cloud Platform, Bosideng also helped core stores resolve the problem of information island, and integrated online sales with offline membership information. Instead of inconsistencies in store and inventory information, and membership information stored at different data centers, the brand new Retail Cloud Platform is built to make information about membership, retail and inventory all sharable, a new sharable retail model.
With intelligent logistics and distribution, the practice of proximity distribution connects China’s five regions. Bosideng has built a Bosideng Group Intelligent Distribution Center, which integrates the industry's top technologies, such as intelligent robots, palletizers and conveyors. Bosideng has independently developed a highly intelligent supply chain management system to promote a high level of informatization, automation and unmanned operation of the entire process, and meet the needs of a multi-category, multi-brand, multi-business model. It is capable of serving both online and offline channels.
In addition, Bosideng will remove retail warehouses. It has built one warehouse in East China and one in Southwest China, apart from the central warehouse in Changshu. This year, it will build one warehouse in North China, one in Northeast China and one in Central China to cover all retail stores and individual consumers across the country, and to increase retail efficiency once again.
From doing business through intermediaries to being a global expert, from product management to brand management, Bosideng, with 45 years of dedication to ingenuity, is groping its way forward in confidence amid competition on the commercial market. This enterprise, which grew up with reform and opening-up, has been given by the times the personality characteristics of a brave person who dares to take risks. We have reason to believe that Bosideng will bring more surprises to the world in the future.