The 2014 White Paper of sporting goods industry (Handpicked)

Sources:CHINA SPORTING GOODS FEDERATION
Release time:2015-11-27

  1 General Development of Sporting Goods Industry

  1.1 Industrial Scale Is Increasing and Growth Rate Is Rising again

  According to the data from the General Administration of Sport of China, in 2006-2014,domestic sports goods industry value added is increasing to 241.8 billion Yuan. The speed is slowing in 2010 but reversed to normal since 2014 due to high inventory and cost, and low net profits.

  Table 1: 2006-2014 value added and growth rate of Chinese sporting goods industry (in 100 million Yuan)

  Notes:1 value added means the sum of value created during manufacturing and fix asset transfer value. Directly reflects the final value one industry or company creates to the society. The formula is: value added=payment of labor + net production tax + fixed asset depreciation + operating surplus. All the value added of every industry will be the GDP.

  2 2009-2014 data is estimated based on past compounded growth and industry changes.

  (Source:qianzhan.com)

  From the aspect of industry segmentation, Sportswear, sports shoes accumulative total sales income of public companies in 2014 is 13.254 billion Yuan and 13.177 billion Yuan respectively, year-on-year growth of 11.00% and 11.00% respectively. Sports ball product manufacturing industry sales revenue maintains steady growth, is 17.435 billion Yuan, up 9.86% than one year before. Training fitness equipment manufacturing industry and sports protective gear manufacturing industry sales revenue has a big increase from 32.434 billion Yuan to 12.973 billion Yuan respectively. Outdoor market maintain a certain speed of growth. Retail sales reached 20.08 billion Yuan, 11.25% more than a year earlier.

  Eight listed companies’ accumulated sales of sportswear went down 16.58%. Shoes fell 16.12%, training fitness equipment fell by 3.33%, sports protective gear down 4.24%, ball product and outdoor goods grow 25.32% and 24.31% respectively. In 2014, all segments sales have risen from 2013, sports protective gear manufacturing industry grew by 47.07%, training fitness equipment manufacturing industry grew by 14.85%, shoes and clothes they increased by 17% and 11% respectively, outdoor products rose 11.25%, ball product manufacturing industry grows the least fast which is 9.86%. Compared with 2013, 2014 sales situation is better.

  Table 1: 2012-2014 Chinese sports goods industry segment revenue (in 100 million)

  Notes: the eight public listed companies are: Lining、ANTA、China Dongxiang、Xtep、Peak、FLYKE INT'L 、MEIKE INT'L 、361。

  (Source:qianzhan.com)

  1.2 Position in GDP Is Expected to Improve

  From the perspective of the national economy status: 2006-2014, the status of sports goods industry in national economy maintained at about 0.4%, the share of sports goods industry in 2014 GDP is 0.38%, rose slightly compared with a year earlier, but overall, advantages of China's sports goods industry in GDP has not been fully reflected, the proportion of GDP is below 0.5%. Along with diversified demand for sports goods the industry market capacity will further expand, and position in the national economy will be improved.

  Table 1:2006-2014 Chinese sports good industry’s share in GDP(in %)

  Note:2009-2014 data is estimated based on past compounded growth and industry changes.

  (Source:qianzhan.com)

  1.3 Increased Market Concentration

  Currently, domestic markets mainly have sporting goods brands including Nike, adidas, Lining and ANTA, Xtep, etc. They have experienced exploration and development after a long time in domestic market, has established a relatively perfect production and marketing network and occupied the most of the domestic sporting goods market. In the fierce market competition, famous brands gradually gained the upper hand, annual shipments increased year by year, the market share is becoming more and more, further squeezing the survival space of small business in the future.

  1.4 Cluster Effect Is Apparent

  From the point view of provinces and production, sports goods industry cluster mainly concentrated in Guangdong, Fujian, Jiangsu, Zhejiang, Shandong, Beijing, Shanghai, mainly in these seven provinces (municipalities), and the concentration rate is more than 85%. From the point view of density of enterprise, sports shoes are mainly concentrated in Fujian jinxing, Guangdong Dongguan, Cixi in Zhejiang, Jiangsu Kunshan. Sports clothes are mainly concentrated in Fujian Shishi, Zhongshan in Guangdong, Zhejiang Haining. Sports equipment mainly concentrated in Fuyang, Zhejiang Cangnan, Jiangsu, Yangzhou, Taizhou, Jiangsu, Hebei Cangzhou. Basket, volleyball and football supplies mainly concentrated in Shanghai, Tianjin, Fenghua, Fuyang, Zhejiang and Fujian Changtai, Yonglin, etc.

  1.5 Technology Promotes Industrial Development and the Market Prospects Is Cheerful

  As a large number of scientific and technological achievements applied in venues service, equipment manufacturing, media development, and sports competition, since 2000, the global growth rate of over 200 sports equipment is 19.4%, for example model aircraft, clothing, cycling, diving, ocean modeling, mountain climbing, fitness rehabilitation equipment. Technological contribution rate is above 82.4%. With the advent of Internet era, the sports industry will face more challenges and opportunities.

  2 The Export and Import of Sporting Goods Industry

  Data from the Customs show that shoes total export and import volume is 20.085 billion US dollar in 2014, trading surplus 17.859 billion US dollar. Import 1.113 billion, 1.81% growth, and export 18.972 billion with 8.29% more than last year.

  Table 2:2013-2014 Sports goods export and import ( in ten thousand US$,%)

  Data source:qianzhan.com & China's General Administration of Customs

  2.1 Export Market Analysis

  China sports goods industry exports volume was $17.52 billion and $18.972 billion respectively in 2013 and 2014.

  In terms of export product structure type, sports equipment (including training, fitness equipment and ball) exports accounted for the proportion of total exports to 21.84%, up 0.49% increase YOY. Athletic shoe exports accounted for 15.83%, the proportion continues to fall. Apparel exports accounted for 12.48%, dropped 0.29% from a year earlier, and other related sports product (golf equipment, fishing rod, water sports equipment, the racket, skateboard, other ski equipment, table tennis equipment and instruments, other race bike, other sports or outdoor play equipment, etc.) exports accounted for 49.85%.

  Table 3: 2013-2014 China sports goods industry export product structure(in %)

  Data source:qianzhan.com & China's General Administration of Customs

  2.2 Import Market Analysis

  China sports goods industry exports volume was $1.093 billion and $1.113 billion respectively in 2013 and 2014.

  In terms of product structure, in 2014 sports equipment (including training, fitness equipment and ball) imports accounted for the proportion of total imports to 13.66%, up 2.74% from a year. Athletic shoe imports accounted for 7.36%, compared with the previous year proportion is increased. Apparel imports accounted for 3.55%, dropped 0.32% than a year earlier. Other related sports product (golf equipment, fishing rod, water sports equipment, the racket, skateboard, other ski equipment, table tennis equipment and instruments, other race bike, other sports or outdoor play equipment, etc.) imports accounted for 75.43%.

  Table 3: 2013-2014 China sports goods industry import product structure(in %)

  Data source:qianzhan.com & China's General Administration of Customs

  3 Suggestions for Sporting Goods Industry Development

  In Oct. 2014, Guiding Opinions on Speeding up the Development of Sports Industry and Promoting Sports Consumption is issued by the State Council, and mass fitness became a national strategy. It can be predicted that future market will be upgraded, and the industry will be on the right track of Value Creation. In order to take the opportunity the domestic companies should be prepared on the following aspects.

  Suggestion one: enhance the development of competition resources.

  In the great pattern of development of sports industry, sports competition and performance is regarded as the pyramid spire which playing a leading role for the whole industry chain. At present, commercial value of competition resources has not been fully developed, low marketization are existed in events, sports stars and other sports resources and contents.

  Suggestion two: promote sports service sector.

  According to estimates, within China's current sports industry structure, 80% is sporting goods, 20% is sports service. Refer to American sports industrial structure, the sports goods accounted for only 30%. At present our development level is not high, the gap with the developed countries are relatively large

  Suggestion three: Optimize sporting goods, and build international brands.

  In order to obtain further development in the competition, sports goods enterprises in China should mostly strengthen promoting branding and competitiveness in addition to technology innovation, adjust product structure, and improve management level.

  Domestic sports goods enterprises should learn successful promotion experience of foreign well-known enterprise, set up "brand awareness", creating a few well-known brands by strengthen quality of the product, cultural connotation, trademark design, science and technology content, the modeling of the trademark, marketing strategy, price strategy, channel strategy and service strategy), media, public relations work in many aspects and the allocation of resources.

  Suggestion four: improve operational framework.

  Enterprises should break through original management methods and innovate. Renew the idea and create enterprises brand and develop brand loyalty in order to improve market competition.


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