In the past year, the cumulative increase in Peacebird’s share price has reached 168.52%.
On March 30, Peacebird released its 2020 annual report, showing operating income of 9.39 billion yuan, a year-on-year increase of 18.4%, and net profit after deducting non-attributed profits of 560 million yuan, a year-on-year increase of 5.91% %.
Peacebird is one of the few traditional clothing groups that has achieved success in the process of youth transformation in recent years. Its main brands, including PEACEBIRD Women’s Wear, PEACEBIRD Men’s Wear, and LeDing, have made changes in brand image promotion, product design, etc., and have taken advantage of the momentum of the “national trend” concept to try to create topics and hits.
In the past ten years, in the process of competing with a large number of domestic and foreign brands, Peacebird has regarded design as its core competitiveness, letting go of young managers and designers, and using the spirit of re-entrepreneurship to more It completes the reshaping and strengthening of brand culture. With China becoming the second largest economy, PEACEBIRD was the first to print the cultural LOGO of “Made in China” on commercial clothing. It was also the first to shout the slogan of “National Trend”, focusing on youth culture and leading the contemporary era. Young people experience China’s local trends.
Wang Mingfeng, general manager of PEACEBIRD’s men’s wear division, said that unlike in the past where it only showed products and designs, this time PEACEBIRD’s appearance at New York Fashion Week has more It is a consideration and upgrade of the brand spirit and future market, including the launch of the “sports line” with the theme of paying tribute to the spirit of women’s volleyball team. “Under the popular trend of sports, when we review the performance of the entire sport in China, the first thing that comes to the minds of Chinese people is the Chinese women’s volleyball team.
“Contemporary young people’s understanding of the national trend , in fact, it is more open and has a more international perspective. “Zhang Jiangping said that Peacebird’s co-branding in design is also a two-pronged approach. “We will choose to cooperate with national brands such as Phoenix Bicycle, White Rabbit Toffee, and Heytea, a tea drink brand favored by contemporary young people. We will also choose to cooperate with Created by internationally renowned IP and designers.
Peacebird has a good understanding of the local and international aspects of contemporary youth culture, and has penetrated the “national trend” into the industry and consumer demand, largely rely on Peacebird Clothing Chairman Zhang Jiangping’s tradition of loving “research.” Every year, Zhang Jiangping leads the company’s core management and designers to Europe, the United States, and Japan for investigation and research. Zhang Jiangping said that in the past During several years of research, we have gradually discovered that the European and American luxury goods industry has begun to adopt niche culture and alternative community culture as trends and trends, and in the social media era of advanced technology and unlimited information, Chinese consumers will soon be able to sense it. ” The transformation of niche cultures such as hip-hop in China into popular trends is the evolution and flow of contemporary youth culture. ”
“Peacebird is about making clothes. By making every piece of clothing made in China and designed in China, we are building confidence. “Zhang Jiangping said that the root of “national trend” is “country”, not just “tide”.
In 2020 alone, Peacebird Women’s Wear launched 15 styles The co-branded series involves many different fields, including animation film and television IPs such as Tom and Jerry, Chibi Maruko-chan, and Mulan, national trendy IPs such as Feiyue and Double Happiness, local independent designer brands such as Angus Chiang and MOTOGUO, and Ouyang Na Real or virtual idols such as Na, Uncle Tongdao, and Luo Tianyi.
Peacebird is also actively marketing and promoting the above-mentioned joint series to enhance this series of products and overall brand awareness. There are endless reviews of PEACEBIRD products on Douyin and Xiaohongshu, and hot searches featuring Ouyang Nana, the spokesperson for PEACEBIRD women’s clothing, often appear on Weibo to promote new PEACEBIRD products worn by Ouyang Nana.
According to Peacebird’s 2020 annual report, Peacebird’s sales expenses in 2020 were 3.27 billion yuan, a year-on-year increase of 13.01%. This is also the fifth year that its sales expenses have increased.
Hot-selling products coupled with a strong marketing strategy give Peacebird greater room for its “direct + franchise” channel model. Direct-operated stores have stronger brand marketing functions, and the in-store space and display All can contribute to product and brand marketing; franchise stores help Peacebird penetrate more markets with lower costs and a more flexible attitude when exporting a new image, and achieve organic growth in performance.
During the reporting period, Taimingbird’s franchise revenue increased to 2.3 billion yuan, a year-on-year increase of 7%.
The basic logic of Taimingbird’s creation of popular products is to speed up the frequency of new releases. , keep up with hot trends, and expand the SKU base to expand the range of consumer preferences it can cover as much as possible. The frequency of joint brands mentioned before is just a microcosm of it. The large number of its regular products and the density of new products are even more impressive. Very impressed.
Investment research platform Yinma Digital Research monitored the Peacebird women’s Tmall flagship store from June to August 2020, showing that the store launched an average of more than 1,740 new styles every month. , the average number of SKUs on sale exceeds 6,000. Data from ECdataway shows that in March 2021, the average number of SKUs on sale at the Peacebird Women’s Tmall flagship store exceeded 4,000, and…��The store launches new products almost every day, with nearly a hundred new SKUs a day during peak periods.
At the same time, the best-selling SKUs in the Peacebird women’s flagship store are highly concentrated. Data from ECdataway shows that in December 2020, the top 20% of SKUs in monthly sales of the Peacebird women’s Tmall flagship store contributed more than 75% of the sales. The store’s best-selling sweater that month had a monthly sales volume of 10,562 pieces, but 52 sweaters had a monthly sales volume of less than 5 pieces.
In other words, Peacebird Women’s Clothing has a large number of non-best-selling SKUs that need to be turned over every month, and there is a high possibility that they will eventually become overstocked. Among these products, many are co-branded products that are more likely to become outdated and depreciate.
Similar situations also occur in men’s clothing, Leding and other brands under the Peacebird Group. This is an important reason why the original value of Peacebird Group’s inventory remains high.
However, at least judging from the financial report figures, although Peacebird is facing inventory pressure, the severity is not too high. This is mainly because the company has adopted a more clever provision policy than other brands in the industry, making the profit figures more attractive.
In fact, in addition to making a fuss about accrual strategies, Peacebird has always attached great importance to inventory issues at the actual operational level. Peacebird has mentioned in its financial reports over the years that the company is working hard to “increase the production and sales rate of new products and reduce inventory formation.”
Since 2018, PEACEBIRD has begun to promote the TOC management model (Theory of constraints, Chinese translated as “theory of constraints”, one of the three major management theories in the world) across the company’s entire brand, accelerating Digital transformation.
Specifically, Peacebird said that it will achieve “comprehensive digitization, dataization and intelligence of the entire link of development and design, production and supply, logistics and sales services, to provide customers with fresh products.” Fashionable and high-quality products increase product turnover.”
In other words, Peacebird hopes to make consumers always willing to pay for new products through user insights and rapid response to fashion trends. What it relies on is that after discovering consumer trend demands, it can flexibly produce through flexible supply chains, continuously pursue orders, and control output and sales, thereby achieving the so-called “reducing inventory from the source.”
In September 2020, Peacebird announced that it would issue 800 million yuan of convertible corporate bonds, of which 650 million yuan was planned to be invested in technology digital transformation projects. According to Peacebird’s description, the related projects will help solve the bottlenecks and pain points of “high inventory and high stockouts” under the traditional operating model of the clothing industry.
However, there is still a long way to go for Peacebird to truly enable technological digitalization projects to effectively drive and solve inventory problems, thereby further promoting the company’s long-term growth.
Because one of the biggest practical problems is that the franchise model that Peacebird relies heavily on is likely to become an obstacle to its in-depth digital transformation.
In addition, although digital transformation has helped Peacebird increase its new product sell-out rate in the past two years, it should be noted that using the supply chain to catch up with the trend is not a panacea, especially for Peacebird. Such a brand.
Peacebird’s current product design model is very close to the fashion cross-border e-commerce SHEIN, that is, it does not predict future market trends, but responds to trends at a faster speed, and then quickly produces and sells them. Make sales. After the product is introduced to the market, real-time tracking will be carried out to quickly pursue orders based on market feedback.
SHEIN is now developing rapidly, with products sold to 220 countries and regions, and sales in 2020 may be close to 100 billion yuan. But PEACEBIRD is not SHEIN.
SHEIN has established a fast fashion model since its establishment. When it first built its supply chain network, it took strong measures to allow suppliers to cooperate with it as much as possible. At present, SHEIN has developed a complex supply chain information system that is difficult for imitators to copy. It is characterized by different information systems for different supply chain links.
Peacebird only started to digitally upgrade its supply chain in 2018, and there is more room for improvement in the speed of responding to new trends and production efficiency.
More importantly, as an ultra-fast fashion brand, SHEIN has an average product price of only US$12 (approximately RMB 78), while PEACEBIRD is positioned as a mid-range and The average product prices of the brands listed above are within the range of several hundred yuan.
Based on Peacebird’s brand positioning and price, in the long run, consumers will expect to buy more products with a stronger brand style and more unique designs from Peacebird. Rather than just following, dismantling and reassembling popular design elements.
In the sinking market, the trendy style pursued by Peacebird is considered to be too advanced and difficult to satisfy the public’s taste. Fundamentally, a design that can truly continuously attract consumers will never be simply based on data analysis and catching up with trends. If Peacebird wants to achieve more long-term development, rather than being a short-lived “Internet celebrity”, it also needs to have a more tenable style and establish a matching supply chain system.
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