The Shoe Business of China
Return on Average Equity has exceeded 30% over the large four quarters. Annual profits have soared by over 60% in 2007. Athletes from the United States and Sweden will endorse the company’s brands at the Beijing Olympics. This company appears to be a bastion of capitalism. Welcome to the Li Ning Company Limited.
Li Ning is more than a leading brand of footwear and accessories for sport and leisure. It is a living advertisement for new China. The company epitomizes a blend of free enterprise and social commitment. It rivals the most popular competitors in its field of business. However, it is far from elitist in its impact on common lives. How is Li Ning different from western footwear brands used in sports and leisure?
Firstly, Li Ning offers better value for money to customers. The average person will find all relevant product features in the company’s shoes and gear. They are also around 10% lighter on the wallet. The pricing is not entirely socialist either. Li Ning has a Trailing Twelve Months Net Profit Margin of nearly 11%.
Li Ning is strong in inner China. The company is based in Hong Kong, but you will find attractive and convenient retail services in the smaller towns of the Mainland. Li Ning has more than 9% market share in China. Footwear sales in this country grow by 30% a year.
Finally, Li Ning exhibits a highly integrated strategy. It does not follow the outsourcing tendencies of its western peers. Everything from marketing campaigns to Research and Development is conceived and controlled in-house. Like its mother country, Li Ning is a formidable fortress of business excellence.