In the Chaohongji store of a shopping mall in Guangzhou, ** jewelry is placed in the most conspicuous position.
Now the main promotion of the lion series, the meaning is better. The clerk enthusiastically introduced that the store K gold and ** products accounted for about half, since the beginning of the year, ** jewelry has sold better.
Chao Hongji was helmed by Chaoshan businessman Liao Chuangbin, who started with K gold and jewelry products in his early years, and was known as the king of "K gold", but unfortunately he was once addicted to women's bags and other businesses.
Catching up with the ** dividend, Chao Hongji reversed from the bottom, according to the preview, in 2023Net profit was 3200 million to 400 million yuan, a year-on-year increase of more than 6%.
Under the general trend of staking in the jewelry industry, Liao Chuangbin seized the opportunity to sink and hit 2,000 stores by joining.
King of Kim
Liao's Chao Hongji is known as the first A-share chain jewelry brand.
In the jewelry circle, its characteristics are distinctive, the name refuses to rub the popularity of "Zhou", and the products focus on fashion jewelry such as K goldAt its peak, revenue accounted for more than 9 percent
K gold, which is an alloy fused with other metals, has a higher hardness and is easy to shape than the traditional one.
Visiting a number of Chaohongji stores in Guangzhou, the reporter noticed that compared with other brands, many of Chaohongji's jewelry are inlaid with diamonds and pearls, or enamel decoration, and the design and shape are richer.
For example, beaded products, Chao Hongji is not limited to popular models such as zodiac and lion awakening, but also crabs, koi, abacus, turtles, rainbows and other shapes.
A store clerk introduced,Chaohong base mostly adopts 3D or 5D and other new hard gold technologyOther brands mostly use traditional craftsmanship.
Fashion features, to Chaohongji to bring young customers. According to the financial report, "the main force of the brand, the post-80s, post-90s, and post-00s accounted for nearly 85%, and the proportion of the post-95s and post-00s increased significantly." ”
K gold products are mostly fixed price, and the gross profit margin is higher, and the gross profit margin of Chaohongji in 2022 is nearly 32%.It is 9 percentage points higher than Chow Tai Fook in the same period
The clerk mentioned that most of the products in the store are fixed prices, "the manual fee is relatively expensive, and it is easier for customers to accept it by adding it directly to calculate the total price." ”
In recent years, the first consumption has set off a boom, and Chao Hongji has taken the opportunity to increase the research and development and investment of the first product.
To grasp young people, Liao Chuangbin worked hard in two aspects:
The first is to launch IP products, co-branded with Doraemon (Doraemon), Big-Eared Dog, Kuromi (Kulomi), Melody and other IPs to create creative products.
The second is to embrace the national tide and bet on the intangible cultural heritage craft "filigree inlay" technique. In 2023, it will launch a series of products such as "Filigree Wind and Rain Bridge" and "Filigree Yunqi", which will gradually become the flagship products of Chaohongji.
In the past year, Liao Chuangbin has tasted the sweetness.
In the first half of 2023, its ** jewelry revenue will be 11200 million yuan, and the proportion of revenue increased to 374% and 4% increase in revenue700 million yuan, contributing half of the total increment.
Scale is left behind
Chao Hongji is actually controlled by Liao's father and son, and the two hold a total of about 23% of the shares.
In Liao Chuangbin's hometown of Shantou Chaoyang, almost the whole village was engaged in the first-class processing business in the early years.
After his father Liao Muzhi purchased **, he entrusted the processing and then sold it to earn the difference. When Liao Chuangbin was young, he followed his father to learn to do business.
In 1996, the Liao father and son founded Chao Hongji, and later Liao Muzhi retired into the background. Liao Chuangbin gradually persuaded the entrepreneurial veterans in his early yearsA large number of professional managers are employed
Liao Chuangbin **Chao Hongji.
As one of the earliest jewelry brands in China, Chaohongji is 8 years earlier than the Liuliufu created by the Li brothers in the same country, and 3 years earlier than Zhou Dasheng, founded by Zhou Zongwen, a native of Fujian.
Seize the opportunity, but gradually fall behind in the competition. In 2023,The total number of Chaohongji stores reached 1,404, less than one-third of that of Chow Tai Sang
One of the reasons is that Liao Chuangbin focused on self-operated channels in the early days, and was keen to open counters in department stores and spend a lot of money on decoration.
*:Internet. This model is conducive to brand building, but it has high capital requirements and slow channel expansion, and Chaohongji is gradually overtaken by latecomers in the franchise model.
Liao Chuangbin is not satisfied with only making ** jewelry, trying to extend to the fashion industry, initiating a number of cross-border acquisitions, and also dispersing resources.
From 2008 to 2014,A total of nearly 1.4 billion yuan has been spent to acquire all the shares of FION, a women's bag brand, at a high premium
In 2016, it took another 39.2 billion yuan to win a 26% stake in the beauty brand Siyanli; After going to make a price of 129.5 billion yuan, the acquisition of the remaining 74% of the equity, and the final transaction was abandoned.
Liao Chuangbin also invested in the beauty cross-border e-commerce Ramira, as well as the medical beauty platform "More Beautiful APP".
The return is not satisfactory.
After the acquisition of the women's bag brand FION, its performance continued to slump. From 2018 to 2022, Chao Hongji made a provision of about 4Goodwill impairment provision of $4.1 billion.
During this period, in most years, the net profit hovered between 70 million and 200 million, which was inferior to earlier.
As of the end of June 2023, because of Fion, there are still 72.5 billion yuan of goodwill was not accrued, suppressing Chaohongji's share price.
It is hoped that in the future, the management will strictly put an end to such irresponsible acquisitions. Some investors criticized Liao Chuangbin so much.
Back to jewelry
Only by returning to the main business and breaking the shackles can we have a chance to catch up.
Since 2018, Liao Chuangbin has closed some self-operated stores and leveraged franchisees to accelerate the pace of expansion.
In 2023, it will have a net opening of 246 stores, and franchised stores account for about 85% of the total stores. The company plans to add 300 new stores per year for the next two years
In the past two years, Chaohongji's expansion has been dominated by second- and third-tier cities, while mature areas have sunk to third- and fourth-tier cities.
*:Internet. The pace of expansion has increased, and so has revenue.
From January to September 2023, Chaohongji's revenue increased by 33% year-on-year, and according to this calculation, the annual revenue will be about 5.8 billion, and the jewelry business will account for more than 9%.It is expected to earn more than 5 billion
The cost is a decline in gross margins. In the first half of 2023, Chaohongji's overall gross profit margin will drop to about 27%, a year-on-year decrease of 5 percentage points.
One of the factors is the increase in the proportion of sales in franchise channels with lower gross profit margins.
The business portfolio is also being optimized.
Liao focused his main business on "jewelry + leather goods" and sold Si Yanli's equity.
He made a rejuvenating adjustment to FION, and the business improved. From January to June 2023, fion's women's bag business,The revenue was 200 million yuan, an increase of about 1% year-on-year
Fion has a relatively high level of recognition in the Hong Kong and Singapore markets, and its sales have increased rapidly in recent years. In the future, we will continue to actively look for opportunities in overseas markets in Southeast Asia. Chao Hongji pointed out.
In the main track of jewelry, Liao Chuangbin is also looking for new opportunities, and man-made diamonds are the outlet he likes.
In 2022, Chaohongji will invest 11 million yuan to establish a joint venture company with the man-made diamond ** merchant "Power Diamond", but it is difficult to see improvement in the short term.
In order to boost market confidence, Liao Chuangbin will increase his holdings in the company from the end of 2023, and by the end of January 2024, the cumulative cost will be 522810,000 yuan, and the proportion of individual shareholding increased to 538%。
Compared with increasing holdings, what investors want to see more is to steadily improve performance, which is also what Liao Chuangbin wants.