Recently, some media reported that Heilan Home has closed nearly 2,000 stores and has debts of tens of billions. At its peak, Heilan House had more than 7,200 stores, a market value of nearly 90 billion, and annual revenue of 3.4 billion. It was the largest clothing company in the A-share market. In recent years, revenue growth has been slow and net profit margins have declined. As the former hegemon of menswear, what happened to us now?
Faced with a dazzling array of various clothing brands, the public has a wide range of options. Therefore, the irreplaceability of public clothing brands is quite weak. As an ordinary consumer, when buying clothes, you should consider the aesthetics of the style, the comfort of the material, the affordability and the durability.
Heilan Home has been criticized by many consumers for being unsophisticated and low-end in recent years, almost insulating young people from its products. In terms of style and aesthetics, the aesthetics of Heilan House have been relegated to the sidelines by many consumers with aesthetic requirements. For example, many netizens believe that wearing the Polo shirt from Heilan House instantly makes you feel 10 years older; wearing some suit styles gives you a sense of déjà vu like a rural insurance salesman.
material comfort, durability, and affordability complement each other and can be said together. In ordinary people's understanding, comfortable materials, durability and non-deformation are important factors that reflect high quality. It is a consensus that high-quality products are priced slightly higher. However, many consumers believe that Heilan House’s quality is not worth its price.
Based on the above two main factors, Heilan House will definitely dissuade a large number of people who have requirements for clothing. Even consumers who have no requirements for aesthetics will choose other brands because of the high price. Moreover, in the 21st century, there are very few people who have no aesthetic requirements. Therefore, brands with ugly designs are destined to be abandoned by the times.
However, Heilan House seems not to be aware of this problem. We did not pay too much attention to the design and material investment of clothing. Instead, we invested a lot of money and effort in marketing. For example, in 2021, taking advantage of the release of the New Pants Band's album, New Pants Band endorsed its own product "Six-Dimensional Stretch Decompression Pants"; the spokespersons also followed the popular stars, and the former Yin Xiaotian , Du Chun For the new generation idol Lin Gengxin who is loved by young fans, and Jay Chou who is famous as a king; in entertainment variety shows, he has title sponsored " The Great Challenge ", " Let's Run Brothers ", " The Masked Singer" " and many other popular variety shows. Marketing expenses can be described as deep pockets.
Of course, marketing is an essential part of a business brand, but design and materials are also very important. Perhaps Heilan House can allocate some of its marketing expenses to the research and development of design and materials, so that so many consumers will not complain that its clothes are tacky and cheap.
This time Heilan House has entered a crisis. It can be said that a foot of ice is not frozen in a day. Due to various factors, Heilan House fell into the dilemma of high inventory and high debt. The backlog of inventory will lead to the inability to sell new products of the season normally, and even the sales method of cutting the price of and cutting the price of will hurt the profit margin. An excessively high debt ratio not only burdens the company with interest but also requires repayment of a high amount of debt principal when due. When the company's operating conditions are poor, it can also cause the company to become insolvent and face the risk of bankruptcy and liquidation. Of course, as a long-established brand, Heilan House has had its glory days and is not in such a dangerous situation, but it has indeed been hit hard.
Under such circumstances, Heilan House, as a men's clothing brand, actually invited Yang Li to endorse it. It can be said that it was dancing on the edge of a knife for excitement and offended a large number of male consumers. A group of men put Heilan House on the blacklist because of this. Don’t underestimate the importance of brand endorsement choice, it has a huge impact on the brand’s reputation and product sales.
The top priority is that Heilan House needs to sort out various unfavorable factors, make rectifications or adjust its business strategy layout, and make up for the situation before it is too late.
