Reviewing the clothing market in the first half of 2021, the author finds another phenomenal trend: in the sub-industries of women's wear, men's wear, mass leisure and sportswear, menswear is especially "out of the circle" outside the sportswear track, showing a trend of differentiation. The leading profitability has been significantly enhanced.

Sports clothing track, ushered in the "Lunar New year" under the opportunity of the double Olympic Games, and the market pattern is concentrated, so there will not be too much discussion here.The men's wear track is still in the early stage of development, and there is a development opportunity of both market scale and concentration, which makes it easier to cultivate large-scale leading enterprises, which is worth paying attention to.

According to data examples, in the first half of the year, the overall income of the middle and high-end men's wear industry reached 7.306 billion yuan, an increase of 26.95% over the same period last year and 7.82% over 2019, exceeding the pre-epidemic level. In terms of gross profit margin, according to incomplete statisticsMenswear enterprises or menswear-led clothing groups, most of the gross profit margin has increased significantly, but also catch up with and surpass the pre-epidemic level in an all-round way.

(source: Wind, collated by Gelonghui)

Specific to the targetChinese fashionmen’s clothingFaucetMuchan Group, the parent company of the brand GXG, has entered the author's research field of vision.The main reasons include: 1. There are inevitable shackles in the growth of single brand and category. Mushan Group is gradually going deep into other categories in the leading advantage of men's wear. at present, children's wear is becoming more and more popular, and the hatching ability of multi-brand and multi-category is more prominent. On the 2nd and 17th, Mushan Group announced its official financial report in the mid-term of 2021, combined with the previous performance of the major e-commerce events.Its operating performance is not only in line with the above trends, but also shows the strategic value of the forward-looking layout, provides a new paradigm, and the financial structure is relatively healthy.

Next, let's explore the details.

1. The gross profit margin has increased greatly in an all-round way due to the addition of multiple factors.

The overall gross profit margin of Mushan Group rose to 51.8% in the first half of the year, up 13.1% from 38.7% in 2020 and higher than 49.7% in 2019 (that is, the pre-epidemic level). At the same time, according to different dimensions, the gross profit margin of the core brands of Mushan Group, as well as the whole sales channel, has greatly increased in an all-round way. Compared with the same period in 2020The gross profit margin of the GXG brand increased by 15.3%; the gross profit margin of offline self-operated channels increased by 2.7% to 69.4% on a high base, and the gross profit margin of online channels increased by 8.4%.

Look at it from behind.Mushan Group continued channel reform in the first half of the year.The number of self-owned stores decreased slightly by 8 to 377, while the number of joint venture stores and distribution stores decreased by 30, 75 to 141 and 666 respectively.As a result, the proportion of self-owned stores has increased to 31.8%. In the retail industry, the gross profit margin of proprietary stores is often higher than that of joint ventures, franchises and other stores.At the same time, it is believed that since the second half of 2019, Mushan GroupTurn to develop high-potential offline stores to effectively enhance brand image, customer experience and online drainage, forming a brand value-added effect.

(source: interim results of the company)

More intuitive dataThese three types of stores in the first half of the yearGross profitRespectively299 million yuan, 32 million yuan及92 million yuanThe efficiency of direct stores is significantly higher.

In addition, thanks to cost control capabilities and economies of scaleIn the first half of the year, against the background of a 10.7% year-on-year increase in revenue, Mushan Group achieved a decrease of 12.9% in the cost of sales instead of an increase.

2. Achieve results through all channels and lead to a pick-up in business performance.

In the first half of the year, the online and offline integration model of Mushan Group has become more mature.The discount rate of online channels has been reduced, and the contribution of revenue has been reduced, while offline channels have led to an increase of 10.7% in overall revenue compared with the same period last year.Of this total, revenue from self-supporting channels reached 431 million yuan, an increase of 62.7% over the same period last year, accounting for 35.8% of the revenue.Also fully demonstrate, online and offline integration, all-channel effectiveness of the superiority and stability of the business model.

From the perspective of the industry, on the one hand, after the acceleration of digital transformation, the dividend of Internet traffic has been reduced, and the cost of obtaining customers has been high; on the other hand, the epidemic has driven many enterprises to greatly increase their online business last year, resulting in a high base number. With the recovery of the offline form of epidemic prevention, the natural diversion line.

Positively, however, there are still structural growth opportunities in online channels. In the recent "99 promotion", the overall online gross profit margin of Mushan Group rose sharply again, up 9.9 percentage points from the same period last year to 48.5%, and the customer unit price also increased by 9.7% compared with the same period last year. GXG brand as an exampleBroken down by channel, especially on emerging platforms such as Douyin，Indicators such as GMV, sales and the number of orders placed all doubled, and gross profit margin increased by 9 percentage points.

Generally speaking, it no longer seems important to be king online or offline. If you go deep into the new retail layout, players who have achieved results through all channels will share more market dividends and have more performance growth.

3. The asset-liability ratio is lower than that of the industry, and the net asset value is growing positively.

In terms of financial structure, Muchan Group is also relatively healthy.

Since 2019The overall asset-liability ratio of the textile and clothing industry has always been maintained at about 50%, with more than 52% so far.And the possibility of concussion upward cannot be ruled out from the point of view of the trend. Specific to the head enterprises, Jiangnan cloth (3306.HK), Youngor (600177.SH) asset-liability ratio is also higher than 50%. Mushan Group's asset-liability ratio in the first half of the year rose sharply from 32.5% at the end of last year to 44.9%, but it was still lower than the industry average. At the same time, as its business performance picks up, it may gradually return to normal.

At the same timeIn the first half of the year, the net asset value of Mushan Group increased positively, reaching 872 million yuan.The current ratio (total current assets / total current liabilities) is 1.87, which is higher than that of the same period last yearShort-term solvency变强. By the end of the first half of the year, Mushan Group had about 748 million yuan in cash and cash equivalents and abundant cash reserves.

4. Summary

As mentioned at the beginning of the men's wear track, there is a development opportunity of both market size and concentration, and it seems that it is entering a period of development and differentiation, and the growth space and profitability of the head enterprises are worth looking forward to.

Among them, the new retail has made a successful early transformation, and the Muchan Group, a clothing group dominated by men and with multi-brands, is even more potential players, and its fundamentals have improved, comparable to or even surpassed the pre-epidemic level.

And it's worth noting thatThe second half of the year is the traditional peak season for clothing enterprises, with higher unit prices for autumn and winter style down jackets, and double holidays for the Mid-Autumn Festival and National Day, as well as a series of large-scale e-commerce activities such as "double 11" and "double 12" to support the business performance of related enterprises.With reference to this year's May Day holiday, consumption broke out in all scenarios from online to offline, and the consumption of department stores increased particularly significantly, with an increase of 19% over the same period last year.

Musang Group frequently broke down jackets and other categories and achieved good market response, and has always been the "darling" of shopping festivals, and has continued to achieve eye-catching performance in various online and offline activities.It is not difficult to foresee that Mushan Group will usher in a more brilliant moment in the second half of the year.Or the "Davis double-click" that is expected to get out of performance and valuation.