Author: Cao Anxun.

In today's weather is good. Today's weather is good.

After achieving record revenues last year, Xtep International (hereinafter referred to as Xtep) has brought good news again.

On July 11, Xtep disclosed its recent operating situation. In the second quarter, the company's main brand retail sales in the mainland increased by 10% year-on-year, and the retail discount level was about 25% off; in the first half of the year, retail sales recorded high double-digit growth year-on-year, and the inventory cycle of channels was about 4 months.

This means that Xtep's long-standing inventory and retail discount levels are continuing to improve, and Xtep is getting closer to fighting with less weight.

This is one of the results of Xtep's destocking and transformation in recent years.

Especially this year, Xtep has accelerated its development pace. On the one hand, it has reached comprehensive cooperation with Huawei Cloud and other companies, and carried out full-scenario digital cooperation and management transformation in fields of research, production, supply, sales, and services; on the other hand, it has sponsored large-scale marathon events such as Xiamen International Marathon, sponsored the China National Team in the Hip-hop Dance World Cup to participate in the Olympics and other events, and increased its voice.

At the same time, Xtep sold sub-brands such as G-Star Raw and Palladium for $0.151 billion in May. Xtep expects that after the completion of the sale, the group's losses will be greatly reduced, and its profitability in the next two years and beyond will improve.

After the sale, Xtep's multi-brand lineup will become a three-brand matrix of "Xtep main brand + Saucony + MEL".

According to Xtep's announcement, the future business structure will be simplified and focused on running: the Xtep main brand will face the mass market; Saucony will serve the high-end and mature consumer groups; MEL will focus on off-road running and outdoor activities.

Ding Shuibao, chairman of Xtep's board of directors, also stated at the annual meeting that in 2024, he will focus on the two major battlefields of "building a system and pursuing efficiency", build two major dams of "finance and talent", strengthen the ability of consumer insight, commodity operation, integration, and coordination, and lay a solid foundation for the journey of 100 billion.

Changjiang Securities predicts that in the medium and long term, Saucony has entered the right track, forming a difference and complement with Xtep's main brand in the running field. With continuous training, it is expected to become the second growth curve of the group.

Looking back on the long river of history, this year, after experiencing various storms and adjustments, is an important turning point in Xtep's more than 20 years of development history.

As a shoe king of Jinjiang exports in the late 20th century and early 21st century, Xtep was also popular for a while. Famous artist Nicholas Tse has been endorsing it since 2001, and a sentence of "Xtep, not just a feeling" has sparked the purchasing frenzy of countless post-80s and 90s.

However, due to slower research and development, serious inventory backlog, and development of multi-brand strategies below expectations, Xtep's gap with rivals, such as Li Ning and Anta, has also grown larger.

In April of this year, due to the Beijing Half Marathon incident, Xtep was disqualified as a partner, and the stock price evaporated 1 billion Hong Kong dollars within two days, exposing the operating processes and capabilities that need to be improved in sponsoring events.

Today, riding the wave of the rise of "Guochao", and the hosting of major international sports events such as the Beijing Winter Olympics and the Qatar World Cup, as well as the rapid rise of emerging sports such as flying discs and flag rugby, the participation in mass sports has soared throughout the country, and domestic sports brands have stood on a new development track.

If you don't move forward, you will fall behind. Facing the rising domestic and foreign sports brands, Xtep urgently needs to boost its market share and strive to win.

For sports brands like Xtep, which is famous for running shoes, expanding the advantages of running shoes in the fierce competitive environment of well-known domestic and foreign brands such as Anta, Li Ning, and Adidas, is undoubtedly the key way to consolidate its market position and achieve differentiated competition.

In this process, Xtep's research and development design, market insight, marketing channels, and other transformations are also imperative. This old sports brand will also be renewed.