Core Viewpoint - The company, once a phenomenon in the e-commerce industry, is facing significant challenges due to quality control issues and a declining brand reputation, prompting a strategic shift towards self-operated and premium products [1][3][14]. Group 1: Company Background and Growth - Founded in 1998 by Zhang Yuxiang, the company initially thrived in the heated domestic thermal underwear market, achieving over 1 billion yuan in sales within four months [5]. - By 2020, the company reached a peak market value of approximately 584.5 billion yuan, with revenues soaring to 41.72 billion yuan and net profits of 11.88 billion yuan [7][9]. - The transition to a light-asset model in 2008, focusing on brand licensing, allowed rapid expansion, increasing the number of suppliers from 422 in 2015 to 1839 by 2021 [7][9]. Group 2: Challenges and Decline - The company began to experience a downturn post-2020, with revenues and net profits declining significantly; for instance, net profit fell to 4.77 billion yuan in 2021, a 59.84% decrease year-on-year [9][12]. - By 2023, the company reported a net loss of 2.37 billion yuan, with a projected profit of only 12 to 18 million yuan for the first half of the year, marking a drop of 76.89% to 84.60% compared to the previous year [1][18]. - Quality control issues have plagued the brand, with multiple products appearing on quality inspection blacklists since 2018, leading to a tarnished reputation among consumers [12][13]. Group 3: Strategic Shift and Future Plans - In response to ongoing challenges, the company is pivoting towards a "self-operated + light luxury" strategy, investing heavily in self-operated product lines and premium offerings [1][14]. - The company aims to rebrand itself by launching new product lines and engaging in high-profile marketing campaigns, including a partnership with media companies and celebrity endorsements [1][15]. - Zhang Yuxiang has expressed a desire for the brand to emulate successful models like Uniqlo, although industry experts highlight significant gaps in product development and supply chain capabilities that need to be addressed for successful transformation [3][21][22].

Core Insights - The article discusses the rise and fall of Nanji E-commerce, which initially thrived on a "brand authorization + platform distribution" model but has faced significant challenges as market conditions changed [1][10][12] - The company is attempting to shift its strategy towards "self-operated + light luxury" to improve brand perception and product quality, but early results indicate this transition is costly and not yet effective [1][3][10] Company Overview - Founded in 1998 by Zhang Yuxiang, Nanji E-commerce initially focused on the thermal underwear market and quickly gained market share through aggressive advertising and a dealer network [4][5] - The company transitioned to a light asset model in response to rising manufacturing costs and market pressures, focusing on brand management and authorization rather than production [5][12] Financial Performance - Nanji E-commerce experienced rapid growth from 2015 to 2020, with revenue soaring from 389 million to 4.172 billion yuan and net profit increasing from 172 million to 1.188 billion yuan [8] - However, by 2023, the company reported a net loss of 237 million yuan for 2024, with a projected profit of only 12 to 18 million yuan for the first half of the year, representing a decline of 76.89% to 84.60% year-over-year [1][10] Market Challenges - The company has faced significant quality control issues, with multiple products appearing on quality inspection blacklists since 2018, leading to a decline in brand reputation [12][13] - The shift in consumer perception towards "Nanji" as a low-quality brand has been exacerbated by the rise of new consumer brands that do not rely on traditional brand endorsements [12][13] Strategic Shift - In 2023, the company began investing heavily in self-operated product lines and launched a light luxury series, partnering with media companies to enhance brand visibility [1][3] - Industry experts suggest that a more effective strategy would involve focusing on product quality and reducing product categories to drive factory upgrades [3]