YOUNGOR Curve Makes Clothing Stronger And Bigger.

By the end of 2007, Youngor YOUNGOR has been publicly criticized for its lack of main business and speculative profits.

In addition to stock and real estate investment business, other businesses of the company have become insignificant. Data analysis showed that YOUNGOR held shares in nearly ten companies such as China life, Bank of Ningbo and CITIC Securities, which made YOUNGOR's investment income in 1~9 months in 2007 reached US $223 million 600 thousand, accounting for 98.5% of the total profit of the company.

In most people's impression, YOUNGOR's suits and shirts were once the first brand in the clothing market. How can the total profit volume of a clothing leading enterprise be basically unrelated to clothing? Why is such an excellent clothing company become a stock and real estate investment company?

　　 clothing The main business is more and more like decoration.

Since 2002, YOUNGOR has adjusted the vision of the enterprise to "create an international famous brand and build a century old enterprise". The reason for the adjustment is "emphasizing internal strength". For this reason, YOUNGOR also decided to withdraw its equity investment in the two companies by 200 million yuan, so as to transfer funds to the main industry.

However, it is puzzling that in such a high-profile emphasis on the main industry, the company began to enter the real estate business, since then, almost every year, YOUNGOR has adjusted the investment in real estate.

The result is that real estate has outperformed the textile and apparel industry as the engine of YOUNGOR's growth. For example, sales of shirts and suits in 2002 were 1 billion 300 million, 1 billion 700 million in 2006, an increase of 30%. Real estate revenue increased from 500 million in 2002 to 1 billion 900 million in 2006, an increase of 280%.

On the other hand, YOUNGOR has not given up its efforts in financial investment. As of September 30, 2007, YOUNGOR held ten shares of listed companies. In November, YOUNGOR subscribed 100 million shares of Haitong Securities for 3 billion 588 million. At the highest time, YOUNGOR held a stock market value of 24 billion yuan.

At this point, textile and clothing are more and more like furnishings. In the face of real estate and equity investment, their profits have not been counted.

　　 Finance and real estate provide food for clothing.

But if you think YOUNGOR will give up the main business, it's wrong.

YOUNGOR wants to make clothes bigger and bigger by means of financial and real estate.

By 2007, the average market share of YOUNGOR shirts was 12.32%, ranking twelve in the same industry for the first time in a row. The total market share of suits is 13.31%, ranking first in the same industry for seven consecutive years.

In November 6, 2007, YOUNGOR acquired a stake in Smart and Xin Ma 100% with a total transaction value of US $120 million. According to the announcement, Smart is a world-renowned clothing production, sales and brand agency business. Xin Ma is Smart related, original inventory and accounts receivable in the United States and other assets. In theory, YOUNGOR will become one of the strongest clothing companies in the world after takeover.

But as YOUNGOR entered the property market in 2002, In the first few months before the merger, YOUNGOR set up two subsidiaries: Ningbo YOUNGOR Venture Capital Co., Ltd. and Shanghai YOUNGOR Investment Co., Ltd., the former is VC, and the latter is more like PE. This can not be ignored.

Since then, we have finally realized that what YOUNGOR has done is to establish a growth mode of a three level business chain. The cash flow business is textile and clothing, the growth business is real estate, and seed business is financial investment.

　　 yes ability Problems, not opportunities.

The problem now is that most companies are looking for three business chains in their main businesses, such as Coca-Cola's expansion abroad, and Procter & Gamble's brand management system to extend the product life cycle.

How can YOUNGOR leant out of traditional industries lightly and dance between high profit real estate and financial investment businesses?

President Li Rucheng also answered this question: "to make any investment, we must have a judgement on what stage China will enter in the development of the world economy. Can we vote? Where is the risk? We must grasp it in the direction of China's economic development.

The reason is so simple. The reason is his grasp of China's national conditions. What does it mean by the so-called "development stage" in China? Is that the use of China's immature development opportunities to make money in the transition society? How many times has this game been repeated in the thirty years of China's reform and opening up?

Far, such as Jianlibao grasp the opportunity of sports drinks, Changhong grasp the opportunity to upgrade the color TV to the big screen. Near sunchi's chance to seize real estate is not always a game of chance.

In this regard, I suggest that YOUNGOR study GE carefully.

How does GE grow? Most of the companies in the world fail in diversification. What GE can succeed? By contrast, one may understand that profits and risks are always two sides of a problem. High profits always correspond to high risks, and diversification is essentially a capability problem. Just like learning a foreign language, learning many foreign languages is pluralistic. Specialization is learning a foreign language. Why do most people learn a foreign language? The reason is very simple. Learning a lot of foreign languages is essentially a matter of ability, not chance.