After a period of downturn, the stock price of VF Corporation, the parent company of trendy sports brand Vans and outdoor sports brand The North Face, has finally rebounded. At the close of trading on October 4th, the stock price of Weifu was $21.31 per share, the highest in a year.
Prior to this, Weifu Group had just announced the replacement of the head of its Dickies brand. Weifu Group informed its employees via internal email that Chris Goble will take on the role of Dickies brand leader under the group starting from October 14th. Todd Dalhausser, who previously held this position, was transferred to the position of General Manager of North Brand Americas one month ago.
Chris Goble's resume shows that he has extensive experience in the clothing industry: Chris Goble worked for GAP for several years, and when he left GAP, his position was Chief Product Officer and General Manager of North America. The rise in the stock price of Weifu Group indicates that although Chris Goble has not yet officially taken office, his arrival has already brought dividends to the new owner.
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This clothing group's revenue for the fiscal year 2024 was $10.455 billion (approximately RMB 75.69 billion), a decrease of 10% year-on-year. Among the four major brands, except for the slightly increased 2% in the north, Vans, Timberland, and Dickies all experienced varying degrees of decline in revenue, with revenue decreasing by 24%, 13%, and 15% respectively.
The performance of Weifu Group in the past few years has also fluctuated. From fiscal year 2020 to fiscal year 2023, Weifu Group's annual revenue was $10.5 billion, $9.2 billion, $11.8 billion, and $11.6 billion, respectively. During this period, the heads of the four major brands in the group have all undergone changes. The addition of Chris Goble is already the ninth management change since the current CEO of Weifu Group, Bracken Darrell, joined the company.
It cannot be denied that replacing the management team can indeed play a role in strategic innovation and activating the team to a certain extent. However, what Weifu Group must admit is that this also raises a question mark on the stability of the internal management of the group at the current stage. Even if the stock price briefly rises, it remains to be seen whether Chris Goble can bring long-term gains to the group.
Of course, the decline in performance of clothing brands cannot solely blame the management, especially for trendy brands. In fact, the sports trend market has cooled significantly both domestically and internationally in the past two years. The overseas trend oriented platform StockX and the well-known domestic trend trading platform Dewu have undergone multiple rounds of layoffs since 2020. A research report by well-known market research firm NPD shows that compared to the significant increase in sales in previous years, the global trend market has slowed down significantly, which is undoubtedly a fatal blow to Vans, Timberland, and Dickies, who rely on trends for their livelihood.
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What is even more alarming for Weifu is the slowdown in growth in the north, after all, this outdoor brand is a valuable growth "seedling" of Weifu Group when other brands have been experiencing consecutive growth "stalls".
North entered the Chinese market very early, as early as 2000, this outdoor brand entered the Chinese market through franchising. At that time, the outdoor market in China was not fully developed, with many opportunities and still a blue ocean. But for today's North, the intensity of competition in the outdoor field has increased by several levels.
According to Tmall's 2023 Double 11 Shopping Festival outdoor brand sales chart, North, which ranked first in 2022, has fallen to second place, replaced by the domestic brand Camel. In addition, Boxi and ranked fourth, while Kaileshi entered the top ten. A group of domestic outdoor brands, represented by camels, focus on cost-effectiveness and form a surrounding trend in the lower part of the north. On the north side, high-end brands represented by Archaeopteryx are no longer limited to the professional outdoor field, attempting to move towards outdoor trends and even labeling themselves as "light luxury".
From the signals released by the management, it can be seen that the North still plans to focus on the Chinese market for development. After all, in the 2024 fiscal year, the Greater China region has achieved 13% business growth data, despite the lack of growth in the US market and EMEA (Europe, Middle East, Africa) market, which are the main markets of Weifu.
In a previous interview with Interface News, Dong Li, Vice President and Executive Director of North Asia Pacific, said, "We dare not make a direct conclusion on how far China's outdoor clothing can grow. Looking at the total volume alone, we are indeed lower than Europe and the United States, but in terms of incremental growth, the Chinese market is actually ahead of the other two regions
Dong Li believes that from the perspective of enterprise operation logic, the larger the scale of the enterprise, the lower the growth rate will naturally be. The North Future hopes to maintain its growth rate through product innovation, market promotion, and channel improvement.