"Investor Network" Zhang Sven

Editor Hu Shan

The relaxed eye protector is not easy to use, and it is not even as good as the 5-minute eye exercises between classes at school. It is easy to mention it, and some consumers will complain unconsciously.

While consumers complain, it is also difficult for investors in the secondary market to invest in Shenzhen Pixiang Technology Co., Ltd. (hereinafter referred to as "Pixie", 688793.SH).

He landed on the Kechuang board in July 2021 and was crowned as "the first stock of intelligent health hardware" by the capital market. After two days of "good life" since the listing, the stock price has been falling all the way after reaching an all-time high of 109 yuan per share. On September 26 this year, the share price of Baikang once again hit an all-time low, falling to 33.67 yuan per share during the day.

The main dilemma that Pieran faces is that there are too many restrictions on development.

Some market watchers believe that if the market prospect of massager is really broad, it is bound to attract the strong entry of traditional household appliances. Due to the limited technical content of this kind of products, it is difficult to form technical barriers, so it is easy to form a situation of high hitting and low beating. This will undoubtedly reduce the advantages of the easy brand, such as the air purifier of that year.

But before it encounters industry bottlenecks, Pierre's performance has been in the doldrums and has lost money for two consecutive quarters this year.

According to the China News, revenue in the first half of this year was 460 million yuan, down nearly 16% from the same period last year, while net profit loss was about 40 million yuan, down 186% from the same period last year.

This is already twice as easy as a loss for two consecutive quarters. In the first quarter of this year, the company lost 10 million yuan, down 190% from a year earlier.

For such a dismal performance, investors then asked the secretary of the company on the e-interactive platform of the Shanghai Stock Exchange: "what is the reason for the slowdown in the growth of online sales in the second quarter?"

In this regard, times relaxed said: "the company's online sales revenue declined in the second quarter of 2022, mainly due to the decline in residents' willingness to consume under the background of COVID-19 epidemic, and the obstruction of logistics and express delivery led to a decline in consumers' shopping experience." and the company's products are optional consumer products, market demand has been greatly suppressed, thus affecting the company's online sales performance.

Such a statement is obviously open to question.

At the height of the global epidemic in 2020, Pieran still made a net profit of 12 million yuan in the first half of the year, while in the first half of 2021, its revenue soared 65% year-on-year to 540 million yuan. Net profit also reached 41 million yuan in the same period, a 257% increase over the same period.

For poor performance, Southwest Securities believes: "the epidemic interferes with the decline in revenue growth and the pressure on short-term profits; as a massage small power leading enterprise, the company has obvious advantages in the high-end market, and product channels continue to be optimized." it is expected to return to the growth track in the future.

At the same time, the problem of "falsely high prices and difficult to maintain high gross profit margin" is gradually exposed.

Product prices are suspected of being "falsely high"

Since signing an endorsement with popular star Xiao Zhan on May 31 last year, it has become a popular brand in the market, winning the top spot in 618 e-commerce activities.

Under the blessing of stars, fan consumption is the "secret" that companies can maintain high gross profit margins. The price of a neck massager can sell for 559 yuan.

Even at the airport high-speed rail station, you can get a higher price. Previously, in response to the inquiry letter from the Shanghai Stock Exchange, Pixuan said: "in 2020, the average unit price of products sold in the company's airports, high-speed rail and shopping malls was 616.69 yuan per Taiwan, 656.93 yuan per unit and 702.62 yuan per unit, respectively." the corresponding gross profit margins are 75.41%, 75.40% and 76.33% respectively.

Since then, the company has not disclosed the relevant price.

But on second-hand trading platforms, some sellers can even sell at less than half the original price.

Not only that, there are also many consumers who use it only once or twice after purchase and then no longer use it, and even the charging line packaging has not been removed.

This shows that consumers have some "impulsive" mentality when buying such products.

Not only that, some of the easy second-hand products have even been sold as "new products".

On the black cat complaint platform, a consumer placed an order for a neck massager at Baikang JD.com 's flagship store. The customer service claimed it was a new product, but found that other people's delivery orders and returned logistics slips were affixed to the product box.

Then the customer service did not follow up in time.

On the other hand, the second-hand quality of such products is also relatively new, which can also ensure that such products can indeed circulate in the secondary market.

Consumers who like to buy second-hand products told Investor Network: "this kind of products can be used." And Xianyu on a lot of brand-new things, some are given, some are returned, cost-effective. But it was also a novelty when I bought it, and I couldn't remember to use it after a few days.

The consumer also believes that even if products such as massages are updated and launched, there will be no significant improvement in function. In other words, buying second-hand products is enough to meet the needs of consumers. On the other hand, the pursuit of a new generation of products requires about double the cost, which seems a bit unworthy.

From the point of view of the discount rate, brand-new and almost brand-new products can be sold at a discount of half, which is very easy and there seems to be a problem of false high commodity prices for the products of the whole industry.

This has been reflected in the declining gross profit margin year by year.

High gross margin is crumbling?

In fact, the relaxed high gross margin has always been the focus of the market.

According to Wind, the gross profit margin of the company's main business from 2019 to the first half of 2022 is about 61%, 58% and 57%, respectively. In the first half of this year, the company's gross profit margin was 52%, down nearly 8% from the same period last year, including a drop of nearly 12% in the second quarter.

Guotai Junan Securities speculated that the decline in gross profit margin was mainly due to the decline in offline store traffic in the past two quarters and the further increase in the proportion of online product structure.

In terms of individual products, according to the 2021 annual report, the gross profit margins of the head, neck, scalp and eye massages of the four main products are about 61%, 65%, 52% and 64% respectively.

Since 2018, the gross profit margin of the easy product has declined, with the gross profit margin of the head massager falling by about 13%, the eye massager by about 10%, the neck massager by about 2%, and only the scalp massager by less than 7%. The details are shown in the table below.

In the past, massages were exclusive to the middle-aged and elderly, but now young people have become the main consumers of massages, promoting hot sales in the market. After the heat, consumers' views on massage devices gradually calmed down.

On the one hand, rational consumers believe that the main function of physical and pulse cervical massage apparatus is to relax muscles, relieve pain and promote blood circulation. They are more suitable for neck strain and sore shoulder and neck, but they do not have a therapeutic effect.

On the other hand, even with the soothing effect as the selling point, there are cheaper or more effective alternatives on the market. For example, eye massager can be replaced by "eye exercises" and "steam blindfold", while head, neck and shoulder massage can be replaced by "blind massage" and "fitness exercise". While these alternatives achieve roughly the same or even better health care results, there will not be much difference in cost when combined with the frequency of massager use.

Multiple factors drag down performance

And insisting on opening an offline store is also one of the reasons that drag down the company's performance development.

It is easy to think that after years of layout and experience accumulation of the company, the offline channel has formed the exclusive advantage of airport direct sales. The company has always hoped to use the number of stores to refresh consumers' impression of the brand, so as to increase the frequency of users' purchases.

In the first half of this year, the company opened 23 offline stores and optimized 34 stores. As of the end of June this year, there were 202 offline stores, including 174 offline stores and 28 offline stores. Among the offline direct stores, shopping center stores account for 61.49%, while transportation hub stores account for only 38.51%.

However, the intensive opening of offline stores also puts cost pressure on the company. In the first half of this year, the company's sales expense rate further increased, reaching nearly 50%, an increase of 5.5% over the same period last year. In the first quarter of this year, the sales expenses reached 110 million yuan, accounting for 45% of the total revenue, and the sales expenses in the first half of the year were about 230 million yuan, accounting for about half of the total revenue.

It is easy to say that the rental fees of offline stores and the salary of sales staff account for a relatively high proportion of fixed fees, resulting in a higher rate of sales expenses in the company.

For the continuous acceleration of offline store opening, there is a view that double easy did not "learn a lesson."

"New Entropy" said: "as early as 2020, the epidemic has already had a devastating impact on many offline physical businesses, but despite previous experience, it is still not timely enough to adjust its online and offline sales channels."

While encountering external difficulties, Pixuan is also faced with internal pressure. On August 22nd it was easy to issue an announcement of the resignation of senior managers and core technicians. Chen Qing, a former deputy general manager, core technician and director of the planning department, recently applied to resign from the company for personal reasons, according to the announcement.

In the face of internal worries and outer rings, how easy will be to break the situation, "Investor Network" will continue to pay attention. (produced by thinking Finance) ■