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& nbsp; & nbsp; & nbsp; [Chinese shoes Network - Brand Dynamics] Earlier this month, Anta released semi-annual report this year on revenue of 4.1 billion up by 22%, net profit of 800 million, an increase of 28%. downturn environment, Anta is the industry's first brand to positive revenues, "he returned to the growth track up" and the net profit reached a record high points. Prior to the first half of 2011 Anta peak, creating a 927 million net profit. Since 2012, the mainland dismal retail environment, the garment industry because of high inventories, closed shop tide and other factors has not bottomed out. Li Ning recently announced that due to the expansion of direct sales network, clearing channel inventory and other reasons, it is expected first half loss of 550 million yuan, the market surprise. while Shanghai and Hong Kong will be opened on the occasion pass, with ANTA Shizhong, Chairman talk. Anta recovery is representative of the industry, or a case? do "brand wholesale" led to industry-wide dilemma reporter: in 2012 the whole industry in trouble, Anta is how to come out of ? Shizhong: 2012, when the entire industry is in crisis, Anta also not spared, I was inside a lengthy self-examination, that the problem lies in two places: one, into the homogenization of competition; Second, the business model is not changed. the first time, the domestic sports business model is actually a "brand wholesale", after the corporate branding to sell to dealers to get away, do not worry about ongoing operations, this rough business model is the one with more than a dozen year. In order to solve these two problems Anta, I propose, Anta "brand wholesale" from the "retail brand" strategic transformation. Reporter: specifically how to do ? Shizhong: Specific transformation includes flattening the organizational structure, sales performance and grasp the retailer's in-store inventory levels; the use of ERP systems collect data for retailers ordering guidance; retail discount policy is more strong, strengthen dealer competition and profitability; strengthen elasticity of supply chain management, optimizing flexibility and efficiency of the replenishment, product differentiation and to meet seasonal demand for the main product. For example, in the past, ANTA products R & D expenses in cost of sales accounted for only 1.5 percent a few, but the first half of this year reached 4.4 per cent a few, nearly 100 million yuan. Our gross profit margin increased, a large part of this year's contribution from new products. Reporter: high inventory is the focus of this round of industry plight outside criticism. Shizhong: Transition benefits are obvious, although there are still 791 million yuan Anta inventory, but sales ratio (the ratio of inventories to sales, inventory levels to detect whether a reasonable indicator) began to decline. Currently, Anta's sales ratio of 4: 1, in a healthy state. It should be said, is not conducive to sales of inventory is too low, healthy inventory levels can ensure that the needs of sales, while avoiding heavily discounted status. Reporter: From the semi-annual report, the total number of ANTA brand shops as 7701, reducing 56 more than last year, but its children and Fila brand but had increased the number of stores. Shizhong: Anta transformation strategy, adjust the number of stores, store structure optimization and upgrading, improve operational efficiency it is also the key. Anta past two years total off store over 1000, but actually increased the size of retail, so it seems, shops store efficiency, floor effect has been greatly improved. of Anta, the past but also the pursuit of quantity, now in pursuit of quality. Effective shop is the most important, ineffective shop unimportant. Generally speaking, a buy cheap jordans online s long as the loss of shops accounted for less than 20%, it is good, Anta in the lower level of the digital control. CBA signed abandon the Chinese gymnastics team are driven by market behavior Reporter: strong resources to seek sponsorship rights, build brand image is an important strategic sporting goods business. in earnings this year will be two days ago, suddenly announced Anta fully cooperate with the Chinese gymnastics management center. The news surprising, as the gold medal favorites, national gymnastics team sponsorship rights for a piece of "fat" Li Ning has been occupied, cooperation between the two has been for 23 years. Ding Shizhong: In fact, by the end of 2013, the national gymnastics team and Li Ning, the company's cooperation agreement expires, the national gymnastics management center began to tender. We have a priority right to renew the Li Ning, and not gymnastics center and negotiated a new period of cooperation, which gives the opportunity to Anta negotiations. Reporter: Anta compete with international brands, there are many Anta winner, so the market is full of "Li Ning, Anta enter restricted area" and so on interpretation. Shizhong: Sponsored not that complicated, just kind of market behavior is now strategic objectives match. The Gymnastics Center is sponsoring market behavior, no other factor. Two years ago, Anta give up and cooperate seven years China Basketball Association (CBA) contract as well. Anta CBA was the main reason to give up sponsorship is, CBA bidding price is too high, so that the input-output ratio is too low Anta. Reporter: Chinese gymnastics team signed, the capital market is very concerned about the size of shareholder return that investment. Shizhong: This is a long-term sponsor, the impact on performance will not behave so fast, but gymnastics is one of China's best sports project resources, I believe will have a positive impact on the brand, will enhance the brand's long-term income. According to ANTA strategic considerations, as long as possible to take the title in the Olympic team, they are targets. Especially the gold medal team. "Anta core strategy is very clear, that is focused on Chinese sports. We want consumers to think of the Chinese sports, we can think of Anta." Anta to do mass market, learn to be finished Nike Reporter: downturn in the larger environment, Anta was the first in the industry to achieve revenues of positive brand, Anta recovery is representative of the industry, or a case ? Shizhong: Anta recovery, does not represent the entire industry recovery. Not all companies can come out from the bottom, in the short term, domestic brands are still facing serious homogeneity, intense competition problems. But we also see that with the urbanization continue to increase the proportion of urban population, will help drive the sport needs, plus the public revenue increased urbanization, good sporting goods industry future prospects. sporting goods market has been growing on the sporting goods business, the key is to identify the location, in a nutshell is to withstand the temptation to blindly follow the trend. The diverse domestic consumers, as long as identify their location, must have living space. Reporter: Many people Anta, Li Ning and Nike, Adidas and other international brands than Nike hopes to make another. Shizhong: I want to ask you a question, why China all walks of life to a certain extent have suffered serious homogenization that there is no reason to find the gap?. If you do Anta also learn the international brand OEM OEM, that Anta is finished, it is survival of international brands. My idea is very simple, international brands to the international brand market, domestic brands to domestic brands in the market, which a business can cheap air jordans not take-all. The Anta target market is the mass market, mass consumer pursuit is cost-effective, and half Chinese people can not afford our products, you say that there is much room? US population of 300 million, the average person has 4.5 pairs of sports shoes, but in China, this figure is only 0.5 pairs of sports shoes most popular in Guangdong, only 1.2 pairs. He said: "China has 1.3 billion people, 13 people if there is a person to buy Anta shoes, Anta able to sell at least 100 million pairs, but now that goal is still some distance away . Reporter: Investors Looking to next year's performance at Anta it. Shizhong: Anta second half of the gross margin, net profit will remain flat with the first half performance would surely be a better year next year, which I have confidence. I once asked one of our major shareholder, how to judge which stocks to buy? He said a lot of models, but not mentioned priorities. Buy a company's stock, the first to buy a business, buy a performance second, third, to buy the business model, and the fourth to buy the team. Anta these four aspects are good. 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