Summary of Jiangnan Buyi Conference Call Company Overview - Jiangnan Buyi focuses on a dual-driven strategy of design and brand strength, maintaining a gross margin of 65% [2][4] - High-value members (annual purchase over 5,000 RMB) reached 330,000, contributing over 60% of offline retail sales [2][4] - The company has a multi-brand scaling strategy with a compound annual growth rate (CAGR) exceeding 8% over the past five years [2][5] Financial Performance - For the first half of FY2025 (July to December 2024), revenue grew by 5% year-on-year, reaching 3.16 billion RMB, with profit exceeding 600 million RMB, a growth rate of 5.5% [3] - The interim dividend is expected to exceed 220 million RMB [3] Operational Strategies - Core operational strategies include a dual focus on design and brand strength, a high-engagement fan economy, and multi-brand scaling [4] - The average transaction value increased to nearly 2,400 RMB in the first half of FY2025 [20] - The main brand GNCO continues to show steady growth, while emerging brands are expected to contribute significantly, with OnMyGame projected to double its GMV in FY2025 [21] Inventory Management - Inventory balance increased due to lower sell-through rates affected by high temperatures and early Spring Festival preparations [9] - Inventory turnover days remain healthy at 150-160 days, with plans to liquidate 95% of excess inventory within three years [10] - Dealers have a policy return rate of about 15%, with some inventory retained for promotions [11] Market Dynamics - Overall retail sales in January and February showed low single-digit growth, with no significant recovery observed post-Spring Festival [6][12] - In-store performance varies by city tier, with first-tier cities performing better than high-tier cities, which are experiencing a decline in foot traffic [13][14] Membership and Customer Engagement - Active membership numbers decreased slightly, attributed to market conditions and consumer behavior changes [16] - The company employs targeted strategies for member acquisition and retention, focusing on high-value members [18][19] Future Outlook - The company remains cautious about acquisitions, evaluating opportunities without a specific timeline [24] - Digital retail is growing, with a focus on multi-channel strategies to adapt to consumer preferences [29] Additional Insights - The company maintains a dividend payout ratio of 75% for FY2025, despite a decrease in operating cash flow [26] - Dealers are generally profitable, supported by a return policy and renovation subsidies [28]