Bossini Research

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Company background
Bossini International Holdings Limited is an investment holding company which engages in retail, distribution, and wholesale of garments. The investment holding company together with its subsidiaries (“Bossini”) group carries casual wear products for a wide spread age range from ladies', men’s, teenagers’, kids’ and babies' wear products. Bossini was listed in Stock Exchange of Hong Kong in 1993 with a stock code of 592. It was found in 1987 and launched its first retail outlet in 1987 and it expands its distribution network both locally and internationally in the past two decades. Currently, its distribution network contains more than 1,470 stores, approximate 65% of them are self managed stores and 35% of them are franchised stores, covering 36 countries and regions worldwide. With headquarter in Hong Kong, its market covers all over the world. Nevertheless, its core market is the Asia pacific region including Hong Kong, Mainland China, Taiwan, Singapore and Malaysia. Its largest flagship store is situated in Mong kok, Hong Kong.

1987:1st retail outlet opened in Hong Kong
1998:Launched franchising operation
1993:Listed in Hong Kong Stock Exchange
1st retail outlet opened in Mainland China
2004:Launched a new product line, “Bossinistyle”, in Mainland China Present:Over 1470 stores around the world

Bossini’s brand value is “be happy” and it helps promote a positive and optimistic life attitude. The brand color is green and it represents a spirit of growth. Through the colorful products and outstanding customer services, Bossini successfully cultivate a comfortable and feel like home shopping environment. There are mainly five product lines, “Bossini”, “Bossinistyle”, “Bossini ladies”, “Bossini kids” and “Yb” and the major ones are “Bossini” and “Bossinistyle”.

Business Overview
Major markets:
The major markets for Bossini are Hong Kong, Mainland China, Taiwan and Singapore and they are in an order from the highest revenue contribution that covers over 98% of total revenue. The Hong Kong and Singapore markets contribute approximate 55% and 9% of the group’s total revenue respectively and they are quite stable. On the other hand, the Mainland China market keeps contributing more from 2008 to 2011 and it is increased from 19% (2008) to 25% (2011) that represents a 10% average yearly growth. For Taiwan market, the contribution decreases gradually from 14% (2008) to 11% (2011). The revenue contribution can be determined by various factors such as geographic economic performance diversity, geographic brand popularity, and resource allocation, opening more stores can bring in more sales. Therefore, we need to have other analysis to help investigate the cause the revenue contribution up and down. Presently, Hong Kong is still Bossini’s primary market and the major revenue contributor; however, the Mainland China market will be the key growth driver in the long run.

Number of shops:
The speed of opening new stores in Hong Kong, Taiwan and Singapore is stable except the Mainland China. From 2008 to 2011, the direct managed stores has been jumped from 304 (2008) to 456 (2011). This represents a 14.5% average yearly growth. It is one of the reasons to explain why the revenue contribution from the Mainland China keeps increasing. On the other, although the number of franchised stores also has a significant increase, from 391 (2008) to 521 (2011), the revenue from these stores is trivial comparing to the total revenue.

Net sales per square feet:
Even though Bossini has opened lots of stores in the Mainland China, the net sales per square feet in 2011 (HK$1,340/sq feet) is still lower than HK$1,500/sq feet in 2008. It implies that even more stores can bring in more sales to the group, but the marginal benefit is diminishing. The sales growth in the Mainland China cannot catch up the speed of opening new stores. There are many reasons to...
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