Li Ning launches revival plan
17/12/2012
The $224 million plan includes initiatives focusing on support for channel partners' inventory clearance, inventory buyback and sales network rationalisation.
Executive chairman Li Ning said: "Despite the current challenges faced by the industry as a whole, we have an ambitious revival plan to definitively address channel issues. We expect the combined actions to strengthen the long term productivity and profitability of our sales channels, which will in turn support the profitable growth of our company."
Jin-Goon Kim, executive vice-chairman, commented: "The wholesale business practice that had allowed Li Ning to quickly capture market share in the Chinese sportswear industry through aggressive network expansion was no longer able to respond quickly to the dramatic slowdown and saturation of the industry in the past few years. Overexpansion has caused channel partners' inventory to build up and their store productivity and profitability to decline."
Since July, the group has reported good progress on a number of initiatives, including investing in branding and product development, building better supply chain and retail operations and downsizing its cost structure.
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