Case study 2: ANTA – China

General Information
 Business overview:

Anta Sports is the largest Chinese sportswear company, engaging in the design, manufacturing, and
marketing of sportswear. Brands under Anta’smanagement include the Anta core brand, Fila,
Descente, Sprandi, Kolon, and KingKow. As of the end of 2017, the company had 10,983 stores in
China, of which 9,467 were Anta stores and 1,086 were Fila stores.

 Product range: ANTA products ranges across brands, with major brands being ANTA and FILA. ANTA
and ANTA Kids have been 70% of source of sales, while FILA and other premium lines have seen great
growth and high profit margin

FILA and FILA NBA Descente Kingkow Kolon

ANTA and ANTA
Kids
Kids

Mid-high Mid-high Mid-high High-end Mid-high

Middle-market
General/Foreign Licensed Ski-specialist Kids-only Climbing- -specialist
General

 Distribution network: the company had 10,983 stores in China, of which 9,467 were Anta stores and
1,086 were Fila stores. Core brands such as ANTA are sold through wholesaling, while mid-high,
premium brands are sold through direct-to-customers and logistic centers (this system involves
dropping retailer altogether and its access to customers’ data helps FILA and similar brands changes
their products very quickly to react to consumer. The most successful example is ZARA
 Target segments: middle-market segments for core Anta brands, and mid-high segments for
internationally acquired brands
 Target group customers: kids, students, workers, mid-income population in 2nd, 3rd-tier cities, and
high-income population inside major cities (for acquired global brands)
 Store concept:

Key financial data

Analysis of data

Key Financial Summary

Observation on data:
Very strong growth in “Other brands” (Fila): Since its acquisition in 2009, growth in sales for Fila has
been phenomenal. This is a good indicator of how a second-tier brand that targets middle market
consumers can go to first tier consumers with higher willingness to pay. Fila both enjoys a higher status
(on that level of Nike and Adidas) and commands higher margin and helps ANTA build its brand equity to
escape the image of cheap manufacturer

Key successful drivers

- FILA’s success allows improvement in margin: FILA has been a success and are contributing to
30% of sales and 40% of operating profit, with a CAGR of 50% from 2014-17. High growth of a
high margin product will be key behind FILA’s continued strong growth
- Good cost control and can even be managed better with incoming logistic centers: both
operating and non-operating expenses are very stable through the years, and incoming logistic
centers promised to further cut SG&A
- Strong management with wise M&A decision: Fila’s acquisition in 2009 was very successful,
and other recently acquired brands (Kingkow, Kolon, Descente) can be expected to succeed as
well and bring higher return on capital. The management team has also been able to secure
records amount of advertising deals and sponsorships with major sports association such as NBA
and COC
- Sportwear apparel is still in early-growth stage in China: Chinese have only allocated 9% of
their apparel spending on sportwear items, very much lower than average of other Asian
countries (19%)
The company insists `Multi-Brand` strategy to broaden customer base with different brands to
meet different client demands. The company`s brand portfolio reaches consumer segments
across groups of different age, covering mass and high-end markets and providing functional
and fashionable casual sportswear.