Ready for big sportswear league

Not many outside the Chinese mainland might be aware that the world's third-largest sportswear company is a Hong Kong-listed company, but come September 2022, when Beijing will host the Winter Olympic Games and Winter Paralympic Games, the world will likely recognize Anta.

On Dec 15, the Games' emblems were unveiled－and Chinese speed skating Olympic champion Zhang Hong, wearing Anta apparel emblazoned with the emblems, appeared on the dais during the launch ceremony.

That recognition has not come a day soon, according to Ding Shizhong, chairman and CEO of Anta Sports Products Ltd, which was founded in 1994 in Jinjiang, Fujian province, East China.

The 2022 Games' Organizing Committee has chosen Anta as its official apparel partner. Anta, Ding said, has waited for nine years since the 2008 Olympic Games in Beijing, to enter the global league.

"We were a small company with limited resources. We missed the opportunity to sponsor the Olympic Games back then," Ding, 47, said in an exclusive interview with China Daily.

Anta has since grown into an international sports product group, whose market value exceeded $HK 90.9 billion ($11.65 billion) by November-end.

Among sportswear brands, it overtook Under Armour and now trails only Nike and Adidas.

The company's involvement in the 2022 Games is consistent with its ambition. Anta wants to be a big force in the winter sports industry, a market valued at 30 billion yuan ($4.55 billion), and expected to reach 150 billion yuan by 2022.

Ding said Anta will provide affordable winter products by developing multiple categories, including skiiing and speed skating apparel and equipment.

The Chinese sports industry is expected to exceed 7 trillion yuan by 2025. Anta's 2020 goal is to sell 100 million pairs of shoes, more than 130 million pieces of apparel through more than 11,000 stores across the country.

Its next challenge is to become the No 1 sportswear brand in the Chinese market, topping Nike and Adidas.

Anta group's interim results for the six months ending June 30 saw its revenue increase 19.2 percent year-on-year to $1.1 billion. Profit was up 28.5 percent to $217.4 million.

For Ding, innovation is the mantra for winning market share. In 2005, Anta set up its first sports science lab. In the past 10 years, investment in innovation and technology rose to 4 percent of overall revenue ($2 billion in 2016).

Anta now boasts more than 60 patents. Investment in innovation has gone up to 5.8 percent of total revenue this year. Anta started its business by quickly developing stores on shopping streets across China, especially in third－and four-tier cities.

As Chinese shoppers changed their consumption habits rapidly and started frequenting malls for one-stop-shop experience provided by cinemas, restaurants and retailers under one roof, Anta extended its distribution channels to such shopping centers and high-end department stores, outlets and e-commerce.

Ding said street shops now account for 65 percent of all outlets, down from 80 percent at Anta's peak. Outlets in shopping centers are expected to increase from the current 35 percent to 50 percent in future.

Anta's e-commerce business offers more exclusive products, Ding said. During the Singles Day online shopping festival on Nov 11, Anta notched up e-sales of 670 million yuan, up 66 percent from 11-11 of 2016.

Anta has positioned itself as a mass market brand, which helped it to survive the downtrend of the sportswear industry between 2008 and 2011, which was caused by excess inventory. "The most difficult moment for Anta was how to make a decision on what we want to lose and what we want to insist on," said Ding.

The persistence of Anta in serving the mass market by providing affordable products appears to have paid rich dividends. "A pair of shoes of top brands costs 1,000 yuan. Anta's shoes cost 400 yuan. Our product is more competitive," he said.

Anta has no intention to limit itself to the mass market though. It has set its sights on the top-end segment of the sportswear market.

Ding has introduced a multi-brand strategy through acquisitions to cover various segments. The company now boasts a bouquet of brands that includes Anta, Anta Kids Fila, Fila Kids, Descente, Sprandi and NBA.

The group's other brands, including Descente, are going to release children's products. "One brand can't cover all the market nor all the consumers," said Ding.