Original title: Shenzhen Huaqiangbei: how fierce is the new air outlet when the first electronic street transforms into a beauty city?
Huaqiangbei is not only a Jianghu but also a legend. Here, it has witnessed the rise and development of electronic manufacturing industry in Shenzhen.
In recent years, with the decline of mobile phone business and the rapid rise of “beauty economy”, beauty industry has become a new transformation direction of Huaqiang North. Under the epidemic, how affected is the beauty industry here? The reporter made a field visit on this issue.
Make up east wind into “China Electronics First Street”
Since 2019, many media have been competing to report “beauty wind blowing into Huaqiang North” and “dare to ask where Huaqiang North Road is”. For a while, people’s eyes have begun to focus on the former “China Electronics First Street”, which has slightly declined.
After the reform and opening up, Huaqiangbei has become the largest electronic trading market in China, writing a myth of 500000 person times per day and 1 billion yuan of capital flow. It is famous for its rich product lines and diversified ecology, and has produced more than 50 billionaires and countless millionaires. In 1984, Deng xiaoping visited Shenzhen for the first time and made a special trip to Huaqiangbei. Tencent’s first official office is also in the Huaqiangbei Saige science and technology park.
However, in recent years, with the mobile phone market gross profit rate shrinking, Huaqiangbei has declined slightly. Although the rapid rise of bitcoin has briefly boosted the sales of Huaqiangbei’s international mining machines, and electronic cigarettes have also been in the limelight, these are only a flash in the pan. Can the beauty make-up wind bring Huaqiangbei back to its former glory? Where will Huaqiangbei go under the impact of this year’s epidemic?
Recently, a reporter from securities times actually explored Huaqiangbei pedestrian street. SEG electronic market and Huaqiang electronic world are still old businesses in the electronic industry, but there are few people in the mall, and many stores are still closed. Only the first floor Huawei experience store is in full swing. Not far away, Mingtong digital city has been transformed into Mingtong cosmetics market. Yuanwang digital mall, Bauhinia city and Manha Communication Digital Plaza are attracting investment for beauty brands.
Although the beauty industry in Huaqiangbei has been developing for less than 3 years, many shopkeepers in Mingtong cosmetics market have been here for more than 20 years. Boss Yang of Chaoshan told reporters that he has made mobile phones in Huaqiangbei for more than 20 years. Now, mobile phones can’t earn much money. In the past two years, he began to change his business to make up. Many Chaoshan villagers have changed their business to make up. In many cases, dozens of merchants work together to get goods, which can minimize the price.
The merchants here mainly do wholesale business with low price. The price of some international first-line beauty products is only 30% of the counter price. One of the stores posted the quotation directly at the eye-catching place at the door. The reporter visited many stores and found that most of the quotations were almost the same as the prices listed in the figure. When the reporter asked whether a large quantity of red kidney can be given a discount, the clerk said that taking Shiseido’s 75ml red kidney as an example, the current price is 480 yuan (1040 yuan on tmall’s official website), and 2 yuan cheaper for each bottle of more than 100 bottles.
In addition, the reporter selected three representative products with high sales volume, combed the recent purchase prices of various channels, and found that the prices of products in Mingtong cosmetics market are half cheaper than those in the counter, and 20-30% cheaper than those in duty-free stores in Japan.
A reporter went into a shop focusing on Hong Kong channels and found that the price of the goods in the shop was 20-30% higher than that of other stores. He still took Shiseido’s 75ml red kidney as an example and quoted 669 Hong Kong dollars (about 613 yuan) on that day. Although the price is too high, the retail business of this store is very popular. The reporter only spent more than ten minutes in the store, and there were four retail transactions.
In addition, almost all businesses support one consignment, and the price of express delivery is 8 yuan (Xinjiang, Tibet, Inner Mongolia, heijiliao and other regions are quoted separately). Reporters believe that this may be because Huaqiangbei region has been engaged in the export business of electronic products for many years, and the surrounding express and packaging business is developed.
District B of Mingtong cosmetics market opened on June 22, and all the shops in the mall opened. The reporter found many consumers who were carrying suitcases and queuing up to buy goods.
Although during the epidemic period, the business situation of shopping malls was not affected. “Area a has no empty shops for a long time. Area B has only one.” The staff of Mingtong cosmetics market investment promotion department told reporters that the rent of the shop depends on the floor, area and location. The average price is about 1000 yuan / m2 per month. In addition, 100000 yuan entrance fee is required. At present, there is only one covered shop on the second floor in the mall, about 14 square meters, with a monthly rent of 12400 yuan.
According to the boss next to the shop, area a has already been built up. The purpose of entering area B is to expand more business by the scale effect here. When asked about the impact of the epidemic on business, he said that most of the wholesale business is connected with big dealers, Taobao stores, wechat businesses and purchasing on behalf of others. In February and March, everyone had the expectation of hoarding goods, but the shipment volume was larger. Although the business has declined since May due to the large fluctuation of product prices and the increase of overseas transportation costs and time, the overall impact of the epidemic on the bank is not significant.
The scale of cosmetics market continues to expand rapidly, and online red belt products help the high growth
In the first nationwide Shopping Festival after the epidemic, in 2020, the total transaction volume of 618 online e-commerce platform increased by 43.8% year-on-year, including 43.47 billion yuan sales of beauty care cosmetics, ranking the third in all categories.
Driven by the tide of “Internet plus”, the scale of China’s cosmetics market has been expanding rapidly in recent years, and domestic brands are also expanding their scale and influence. In 2019, 2.446 million related enterprises were added, an increase of 80.3% year on year. According to enterprise survey data, there are more than 10 million cosmetics related enterprises in China, including 7.73 million in business.
Geographically, China’s cosmetics related enterprises are mainly distributed in the central and eastern regions and coastal areas, of which Guangdong Province has the largest number of cosmetics enterprises, reaching 812000; Shandong Province has 755000, ranking second; Shaanxi Province ranks third with 620000.
Since January 2020, China’s cosmetics industry has been impacted. By February, the number of registered enterprises was only 48000, down 55% compared with last month. During the isolation period, the market desire for consumption was suppressed, and after the resumption of operation of e-commerce logistics, there was a rebound. In March, the number of registered cosmetics enterprises reached 232000, up 386% month on month. In April, the registered volume of cosmetics enterprises in China continued to grow, and by may, the registered volume had reached 281000.
After the outbreak, with the help of live e-commerce, short video and other new ways of carrying goods, domestic cosmetics enterprises led by huaxizi, Yuze, perfect diaries, etc. still have a more eye-catching performance during the outbreak. According to Taotao data, the sales volume of Yuze tmall flagship store and Gmv increased by 266.5% and 372.2% respectively in 618 period, while according to star chart data, the top five brands of tmall platform cosmetics sales volume in 618 period were huaxizi, 3ce, perfect diary, YSL and Lancome, with domestic brands occupying two seats.
Cosmetics stocks performed strongly, and the long-term high growth trend of the industry was not changed by the epidemic situation
At present, among the A-share listed companies, the stocks involved in the beauty industry mainly include perlaya, MARUMI, Shanghai Jiahua, yujiahui, Huaxi biology, one net one creation, etc.
According to the reptile data, from June 1 to 18, 2020, the sales volume of the flagship store of pelaia tmall exceeded 100 million, with a year-on-year growth of 68.05%. The total sales volume of the flagship store of MARUMI tmall exceeded 60 million, with a year-on-year growth of 173.62%. The sales volume of tmall flagship store of Yuze brand under Shanghai Jiahua exceeded 60 million, with a year-on-year growth of 370.79%; baicaoji dropped by more than 25% year-on-year, MAXAM dropped by more than 40% year-on-year, and Liushen dropped by more than 15% year-on-year. The sales volume of tmall flagship store in yunifiang reached 67.88 million, an increase of 32.46% year on year. The sales volume of runbaiyan tmall flagship store under Huaxi biology reached 39.79 million, a year-on-year increase of 101.59%. One network, one creation’s main operating brand, the flagship store of berberine, has a turnover of about 70 million, a negative growth year on year.
Since this year, the beauty industry has seen a strong trend in individual stocks, with the good performances of peleya, Huaxi biology listed on science and technology innovation board, and one network one creation, which provides e-commerce for beauty brands.
On November 15, 2017, perlaya registered A-share, with an issue price of 15.34 yuan / share. Since then, the share price has gone up all the way. As of the closing on June 24, the share price is 173.85 yuan / share, 10 times higher than the issue price. Since the beginning of the year, the share price has nearly doubled. At present, its market value is 35 billion yuan.
It is worth noting that as of the end of the first quarter of this year, Hong Kong Central Clearing Co., Ltd. ranked the first among the top ten current shareholders of pelier. In that quarter, the newly added shares were 5.43 million, accounting for 8.7% of the total circulating equity.
A total of 51 funds, 2 QFII and 2 social security funds hold positions in pelaia, with the total position accounting for 32.09% of the outstanding shares.
For pelier’s performance, Guoyuan securities Media Internet and cosmetics team analysts told the securities times, “peleya is a very good target from the basic point of view. After listing, the company’s profit has achieved 30% + growth for three consecutive years, and in recent years, it also shows the ability to accurately grasp the channel and industry trend. Before listing, the brand mainly relies on offline CS channel, and after listing, it develops rapidly in e-commerce channel. At the same time Last year, we successfully created the bubble mask, which caught the tiktok of short video marketing. The flexible acquisition of dividends helped to keep the company’s performance growing. At the same time, the company is now trying to build itself into a platform company, and actively expand the brand matrix through M & A, joint venture, agency and other ways, in the direction of a cosmetics group. Compared with the large international cosmetics groups such as L’Oreal, Estee Lauder and Shiseido, the company still has a large imagination space in the future. ”
As the first share of scientific and technological board beauty cosmetics, Huaxi bio is the world’s largest producer of hyaluronic acid, with a gross margin of over 70% in the past three years. On November 6, 2019, the IPO price was 47.79 yuan / share. As of June 24, the share price was 138.01 yuan / share. Since the beginning of this year, the share price has risen by more than 60%, with a total market value of 66.2 billion yuan. On June 19, Shanghai Stock Exchange released the science and technology innovation board 50 component index, and Huaxi biology was selected into the list of constituent stocks.
As of the end of the first quarter of this year, there were 33 funds and 3 QFII holding positions in Huaxi biology, accounting for 31.36% of the outstanding shares.
Guoyuan securities analyst, who just finished the research on Huaxi biology, told reporters, “based on the raw materials of hyaluronic acid, Huaxi biology can be expanded to many fields, such as medical health, medical beauty, cosmetics, food, etc. at present, it has made good achievements in the fields of medical beauty and cosmetics. In the future, it has expanded in the fields of personal care products, oral hyaluronic acid products, pet food, etc Space, and there are already some product reserves. ”
One network one creation is a company that provides e-commerce distribution services and e-commerce comprehensive operation services for domestic and foreign fast moving consumer goods brands. As of June 24, the share price closed at 170.04 yuan / share, with a total market value of 24.5 billion yuan.
As of the end of the first quarter of this year, there were 39 funds and 2 social security funds holding positions in Yiwang Yichuang, accounting for 55.53% of the outstanding shares.
Analysts of Guoyuan Securities said, “the growth of e-commerce itself is relatively fast, and the growth of e-commerce generation operation industry is faster. At the same time, tmall beauty last year said a goal of doubling in three years, so it is currently equivalent to rapid growth in an industry with dividends. I think it should be able to maintain a relatively fast growth in recent two years. But when the growth of this industry has come down and the operation ability of e-commerce has become a basic ability of the brand side, its value may not be so high. ”
For the performance of beauty stocks since this year, the analyst said that the long-term high growth trend of beauty companies will not be changed due to the epidemic, and the market has high expectations for the industry. From the perspective of institutional positions, this statement is also confirmed.