Tuesday, March 11, 2014

Seeking Alpha: Belle Needs To Polish Its Online Efforts

Belle International (OTCPK:BELLY) has built itself into the largest branded footwear retailer in China with a vertically integrated model, a half-dozen of the strongest brands in the country, and over 14% market share (and almost 50% market share of ladies mid-to-high-end brands). Although Belle has shown itself to be pretty adept at building brands and running a store-based concept (with over 19,000 points of sale in China), it has proven far less skilled with its online offerings and the company has struggled to drive profitable growth through this channel and is instead facing some real competition.

Belle acknowledges its deficits in online marketing/retailing and management is working on the problem. In the meantime, the company is slowing its new store construction in Tier 2 and Tier 3 cities and using its considerable cash pile to conduct M&A transactions with an eye toward becoming a more diversified apparel retailer. I would give Belle a better chance than its peers of pulling off this transition successfully, but it may be some time before revenue and EBIT growth returns to a strong double-digit clip.

Continue reading here:
Belle Needs To Polish Its Online Efforts

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