Li Ning Switches Market Focus After Losses Of 391M Yuan In 2013
Li Ning "plans to focus on the mid-tier market and exit non-sportswear categories" after reporting a loss of 391.54M yuan last year, 80% less than the 1.98B yuan it lost in '12, according to Tiffany Ap of the SOUTH CHINA MORNING POST. Revenue fell 12.8% to 5.82B yuan, "partly due to a shrinking outlet network." The number of stores fell to 5,915 from 8,255 in '11. The company said that its goal "was to steer focus away from casual wear, a crowded and competitive segment, and back to its core in sportswear while elevating its brand to a more premium position." Li Ning Exec Vice-Chair Kim Jin-goon said, "There's not a lot of players [in the middle]. Our belief is that local brands do not have the innovation or the brand power … the international brands have a high cost structure, they don't have a more nimble operational platform. The numbers back us on this. The Li Ning brand is the only brand that is able to have a local cost structure with a value proposition that's able to step up with a premium" (SCMP, 3/25).