Industry interpretation | Actual home and the Red Star McLaren's wrists have their own money?

All along, dealers and companies around the world have been eager to enter the high-end home building materials stores, because this move can not only attract a large number of consumers with home improvement needs, but also demonstrate its brand's market position. In this situation, the high-end home stores such as Red Star Macalon and the House of Homes have developed rapidly and gradually formed the pattern of "South Red Star North". However, one mountain can not tolerate two tigers. The wheel war is thus staged . This side, grab the floor; the other side, joint . This side of the market, listed; side of the box, financing; this side, the brand alliance, the side of the box ... ...

Red Star Magellan: The number of department stores is 185, far more than self-employed

The management of malls can achieve rapid expansion with limited capital expenditures. With the popularity of the company's brand, mature business processes and huge business resources, the company has adopted a light asset strategy to quickly expand its territory in the third-tier cities and other cities. The company's ability to quickly open new stores and increase market penetration throughout the country has enabled the company to lead its competitors in many cities.

In addition to seizing the strategic value of the market layout, the profit model that administers the mall business is characterized by high profit margins due to the high value-added and scarcity of related services. In 2014, 2015, 2016 and 2017, with the continuous sinking of channels, the gross margins of Redstar's management of mall business segments were 76.57%, 74.50%, 66.45% and 63.90%, respectively.

In 2007, the company entered into the first shopping mall management agreement with its partners and opened the first department store. In 2010, the number of department stores opened by the company (46 companies) surpassed self-operated shopping malls for the first time (33), and the asset-light model was widely recognized by the market.

As of December 31, 2017, the company operated 256 shopping malls in 177 cities in 29 provinces, municipalities directly under the Central Government and autonomous regions in China, with a total operating area of ​​approximately 151.7377 million square meters and 71 self-operated shopping malls (a total operating area of ​​5,705,954 square meters. m, with an average occupancy rate of 97.6%) and 185 administrative malls (with a total operating area of ​​9,431,775 square meters, with an average occupancy rate of 97.6%).

In 2017, Red Star Meikailong newly opened 7 self-operated shopping malls, closed 2 self-operated shopping malls, and 2 other shopping malls were transferred to self-operated stores, and 2 shopping malls were converted from self-operated to commissioned. As of the end of 2017, there are a total of 22 self-operated shopping malls under preparation for Meikailong, and 350 of the commissioned malls under preparation have obtained land use rights certificates/fields.

The entrusted business model enabled Red Star Macalline and the department store management partners to achieve a certain degree of win-win. This model enables the company to quickly realize operating income and increase the return on investment, expand geographical coverage, increase market share and brand awareness in the context of relatively low capital expenditure; it also brings stable rental income to the commissioned shopping mall partners.

Red Star Meikailong entrusted the management of shopping mall business from 2014 to 2017 with revenue of 2.873 billion yuan, 3.228 billion yuan, 2.78 billion yuan and 3.629 billion yuan. The company will participate in the development of the entire or part of the mall's development process and provide consulting services to the partners or project general contractors. According to different stages, Red Star Macalline provides pre-project title consultation, project annual naming consultation, engineering project business management consulting, business consulting fees and investment commissions and other commissioned services.

In the project's initial title entrustment management service, the revenue of Redstar Macalline from 2014 to 2017 was 1.046 billion yuan, 1.449 billion yuan, 1.356 billion yuan, and 1.587 billion yuan, and the average annual cost of a single project was about 10 million yuan.

In the project's annual title management entrusted management services, the revenue of Redstar Macalline from 2014 to 2017 was 1.127 billion yuan, 1.303 billion yuan, 1.369 billion yuan, and 1.539 billion yuan, and the average annual cost of a single project was about 10 million yuan.

In terms of business management consulting fees for engineering projects, the sales of Red Star Macalline from 2014 to 2017 were 700 million yuan, 476 million yuan, 114.630 million yuan and 140.19 million yuan respectively, and the average cost of a single project was 30 million to 40 million yuan.

In terms of business consulting fees and investment commissions, the service was not carried out in 2014 and 2015. The company's revenue for 2016-2017 was 45,488,300 yuan and 36,204,900 yuan.

Actually Home: Bring Ali into Online

For many years, the House of Truth has dominated the northern market and was in Beijing’s position as the boss. However, it has never thought of a chain-like expansion. Its state-owned assets background is considered to be one of the important reasons. Until 2002, Red Star Macalline quickly took advantage of the power of capital to awaken the surprise home and began to replicate the stores.

In recent years, actually, in order to compete with the Red Star Macalline, the House has continued to scrimp and expand its territory, and its annual number of new branches has increased year by year.

On March 17th this year, Actual Home was officially opened in the 224th branch store in Jiaozuo, Henan Province, which was the first store opened by the House of Fame in 2018. Following the opening of a new number of stores in 63 stores opened last year, the House of Actual plans to hit 300 stores this year.

The measures taken in the past year by the House of Actually, on the one hand, are the speed of opening the store which surprised the industry, and on the other hand, the expansion of its large home strategy. In July 2017, actually the house officially started the process of listing; in December 2017, actually the first 200 stores of the house, Changchun Sun City Store, officially opened, which was only two shops opened at its 100th store, Lanzhou Yanbei Road. Year time. At the end of 2017, there were a total of 223 homes actually opened.

The speed of opening a shop can not be separated from the support of funds.

In February of this year, Alibaba and its affiliates invested a total of 5.453 billion yuan in shares in their homes and held 15% of their shares. Driven by Alibaba, 16 investment institutions such as Sequoia Capital, Jiuding Investment, and Boyu Capital also jointly invested in the Coming Home with a total investment of RMB 13 billion.

There are three main reasons why Ali chose the home.

First of all, the business model of the home is different. As a property management company, the home actually receives cash and collects rents and commissions. Providing consumer sites and household brands with a place of consumption and a traffic business, rather than directly dealing with consumers, is consistent with the role played by Taobao and Tmall, and has a greater degree of compatibility, facilitating later transformation. Secondly, Actually, House has a wealth of designer resources. Actually, the designer platform has as many as 100,000 registered designers in China and actively participates in international important design exhibitions such as Cologne, Paris and Milan. With the resources of designers, we can quickly open the entrance to the field of e-commerce in the home improvement field. Thirdly, the more than 200 stores under the House of Fame can create a complete offline service network to solve the last hundred meters of distribution, installation, maintenance and maintenance. Can provide a better consumer experience, but also can lead home sales. In addition, Actually, Home House focuses on building large-scale logistics, has a 3000-mu reserve logistics base in the country, and gradually put into use, the goods of the home factory can be directly delivered to the distribution center, providing one-stop home furnishing for one-piece maintenance and full maintenance. Chain service.

Two weeks later, an announcement by Gu Jia Household once again allowed the home of the surprise family to become the focus of the market. The announcement pointed out that Gu Jiajiao plans to invest 198 million yuan in the actual share of the home to maintain its business strategic cooperation and gain its IPO listed capital gains.

In fact, the Red Star Macalline has taken a step forward on the road to capitalization.

Hongxing Meikailong successfully IPO in Hong Kong in June 2016, with a total financing of 7.006 billion Hong Kong dollars; on January 17, 2018, it also achieved A-share listing, raising funds by 3.05 billion yuan, and further expanding the scale of store coverage by raising funds, consolidating the leading position in the industry. .

Thanks to the rapid growth of revenue, the cash flow of Red Star Macalline is exceptionally strong. According to the data from Red Star Macalline, the company's operating revenue in 2017 increased by 16.14% year-on-year to 10.96 billion yuan; net cash flow from operating activities increased by 63.62% year-on-year to 6.518 billion yuan. As of December 31, 2017, the book currency of Red Star Macalline was 10.627 billion yuan, an increase of 73.13% compared to 6.138 billion yuan at the end of 2016.

With the rise of cross-border business in the future and the integration of home brands, the mode of home furniture stores selling furniture and building materials must be changed.

In this regard, actually the home will be the future of the strategy to build a consumer ecosystem around the concept of big family. The red star Miquelon is not to be outdone. Focusing on the strategic positioning of the “omni-channel pan-home service platform service provider” and taking “home” as the core, we will conduct upstream and downstream cross-border extension of the business and create a commercial life community in the pan-home industry.

Regarding the winners of the Red Star McGraw-Hill and the Real Family, I won't judge. However, with the wind, the home circulation industry is no longer stable. The competition among predators is not necessarily a good thing for a manufacturing factory in the furniture industry. This is somewhat sad. It is the integration and control of the furniture entities. The industry calls for the emergence of a benign model, leads the integration, prosperity, and development of businesses. The predators are even more powerful, and the distributors are still the “disaster victims”. Its realization is in the era of new marketing. With the Internet and artificial intelligence occupying the leading position today, how far can the traditional model go, if not for China to have a financing platform, or if the Chinese are not to behave in a public manner, the crisis in furniture stores may have long since returned. Lu Xun once said that "China has always had few heroes who have failed, few tough rebellions, few dare to fight alone, few dare to hurry to trespassing traitors; see Sheng Zhao have gathered, see the defeat have fled "The true spirit of innovation in Chinese craftsmen has always been a difficult task. While predators need it, talented geniuses are also needed, but it is also necessary to nurture the soil of genius. It seems that this is indeed the case.