IPO: Jiaman Clothing Plans To Raise 521 Million Yuan

The children's wear industry, which is in the period of deep adjustment, has finally ushered in a bright color. Beijing Jiaman Clothing Co., Ltd. (hereinafter referred to as "Jiaman clothing") has opened its application and will be listed on the Shenzhen Stock Exchange gem.

The company has many middle and high-end children's wear brands, such as water baby, hush hush, haggis, etc., which will become the "first high-end children's wear stock" of a share after it is listed.

As the "apple" in the children's wear industry, with strong design and research and brand operation capabilities, with the help of vipshop, Shuo Yin and other e-commerce platforms, Garman clothing has achieved steady growth in performance and improvement of profitability in the industry. It can be called the most beautiful baby in the children's wear industry.

First share of high end children's wear

Most of the memories of their childhood clothes in the 1970s and early 1980s are only blue, gray, black and white under the simple aesthetic. As far as children's wear is concerned, the post-90s generation should be the first batch to taste fresh food in China, and new styles such as skirt, small windbreaker and sun visor are becoming more and more popular.

In the early 1990s, foreign investment brought about the fashion trend and advanced industrial model of children's wear. In China's nearly blank children's wear market, it gained broad development space, and gave birth to the first batch of local children's wear brands, including souhait, which was officially listed in 1995.

In the early stage of the children's wear industry, Shuibao established the brand connotation of "the best is like water", and integrated Chinese culture into the color system, pattern, fabric and design of the products, which made it stand out from the crowd for a time.

At the same time, at the beginning of its establishment, Shuibao was located in the middle and high-end market, and chose to open counters in the high-end shopping malls of Yansha friendship mall, Cuiwei department store and Parkson.

According to the evaluation results of China clothing association, "Shuibao" brand has been ranked as "China's top 10 children's wear brands" for many years; In 2020, China's children's wear market sub categories, the market share ranked seventh.

In order to reduce the dependence on a single brand, Jiaman clothing, the parent company of water baby, learns from the operation mode of international clothing giant and starts multi brand strategy.

In 2013 and 2015, the company successively obtained the authorization of Hush Puppies children's wear and haggis children's wear in mainland China, and officially started operation in 2014 and 2017. Hush hush was founded in the United States in 1958. Haggis is a member of LG Group in South Korea. Both of them are well-known high-end fashion brands in the world.

Today, the business of Shuizi is stable, hush hush and haggis continue to grow, forming the "troika" of Garman clothing.

While operating the three brands well, the company also acts as an agent for the retail business of international high-end children's wear brands such as "Emporio Armani", "Kenzo kids" and "Hugo Boss", and establishes an international high-end children's clothing boutique "bebelux" with its own advantages.

Water baby, hush hush, haggis, bebelux and other medium and high-end children's wear business has gathered, making Garman clothing the leader of China's high-end children's wear market. The company has started to apply for purchase, and will soon land in a share to become the "first high-end children's wear stock".

Apple in children's wear

By outsourcing, the company can not only master the core of the e-commerce industry, but also master the power of production and operation in the electronics industry.

With the further development of social division of labor, this business model has been applied to all walks of life. Garman clothing is a typical representative of the "apple" fashion industry.

As a children's clothing operator, the great advantage of Garman clothing is the rich operation and management experience accumulated in the development of children's clothing industry in China for 30 years. Among them, the most outstanding is the design ability.

The company has set up different design groups for its own brand "water baby" and authorized brands "hush hush" and "haggis", with a total of 52 designers.

In the past three years, the number of SKUs designed, put into production and sold by Garman clothing is 7503, 7696 and 6966 respectively.

By the end of 2021, including more than 600 sales personnel in more than 100 direct stores, the total number of employees of the company is less than 1000, and the salary to sales ratio is less than 10%, which is lower than the overall level of clothing enterprises of the same model.

The low cost of asset light mode and high gross profit of high-end positioning have improved the overall profitability of the company.

From 2019 to 2021, the gross profit margin of main business of Garman clothing is 50.65%, 56.73% and 59.26%, which is not only stable in the whole clothing industry, but also significantly better than the companies such as Arnel and SEMAR clothing in the children's wear sector with stronger general profitability.

During the reporting period, the operating revenue of Garman clothing was 89483800 yuan, 119 million yuan and 175 million yuan respectively, with the operating revenue of 89483800 yuan, 1043 million yuan and 1214 million yuan, respectively. It achieved steady growth in performance against the trend, and its profitability ranked first in the children's clothing sector.

The change of macro environment and the spread of epidemic situation have made the children's wear industry go through a difficult adjustment period. Anel lost money for two consecutive years; In 2021, the start-up stock has a huge loss of more than 200 million yuan; The performance of the golden haired Rabbi has been cut down; It was only after the separation of the French children's wear brand, kidiliz, that the performance of SEMA clothing recovered. In contrast, the ability of Garman clothing to cross the cycle is highlighted.

Embrace e-commerce channels

What is the secret of Garman clothing to achieve performance growth against the trend? Embrace e-commerce channels.

The company attaches great importance to the opportunity of e-commerce channel branding, takes advantage of the latecomer advantages of hush hush and haggis in the Chinese market, deeply arranges e-commerce channels, and avoids the influence of epidemic and other factors on offline physical stores.

By the end of 2021, the company has opened 189 Direct stores and 405 franchised stores offline, and 37 online stores have been opened on vipshop, tmall, Jingdong and other e-commerce platforms.

The company has become a 37 net shop. From 2019 to 2021, its online channel revenue accounted for 52.91%, 61.59% and 65.23% respectively.

In contrast, traditional children's wear enterprises, such as SEMAR clothing, Chanel, start-up shares and golden hair Rabbi, are subject to channel inertia. Although online channels have improved in recent years, they only account for 30% of the overall level.

As a collection of high-end children's wear brands, the most concentrated platform for e-commerce business of Garman clothing is not tmall and Jingdong, but vipshop.

Vipshop brand's special sale attribute is more consistent with the positioning of the medium and high-end brands of Garman clothing. In addition, vipshop is mainly female users, corresponding to Baoma, the main buyer of children's wear.

The company adopts joint venture mode to cooperate with vipshop to realize the rapid growth of business. In the past three years, the sales revenue of Garman clothing has reached 191 million yuan, 328 million yuan and 392 million yuan through vipshop, accounting for 21.36%, 31.45% and 32.26% of the main business income respectively.

In recent years, the rapid rise of live e-commerce also makes Garman clothing see a new market direction. In 2020, the company made a small-scale trial on shuoyin e-commerce platform, and achieved a performance explosion last year, with sales revenue increasing from 11700 yuan to 74128700 yuan.

In this IPO, Jiaman clothing plans to raise 521 million yuan, of which 313 million yuan is planned to be invested in the construction project of e-commerce operation center, which will continue to dig into the moat of the company in the high-end children's clothing e-commerce market.