CHINA LILANG President Wang Liangxing once stated: "Transformation is not a short-term endeavor, and publicity and promotion are double-edged swords. If they don't match the brand's actual capabilities, they could harm the brand instead." This statement has proven prophetic, as CHINA LILANG, amid its transformation wave, has yet to find an effective formula for performance growth. According to CHINA LILANG's recently released financial report, the company recorded revenue of 1.727 billion yuan in the first half of 2025, representing a 7.9% year-on-year increase, while net profit reached 243 million yuan, marking a 13.4% year-on-year decline.
CHINA LILANG did not directly address the reasons for the net profit decline in its financial report. However, regarding the 17.1% year-on-year decrease in operating profit for the first half of 2025, the company attributed this primarily to reduced government subsidies and increased expenses from self-operated stores and e-commerce operations. Additionally, the financial report showed that revenue from CHINA LILANG's main "LILANZ" series reached 1.191 billion yuan in the first half of 2025, representing a slight 0.2% year-on-year decline. The company explained that the revenue decrease for this product series was mainly due to "declining distribution business sales revenue caused by channel transformation and inventory repurchase cost deductions."
Whether it's the operating profit decline caused by increased e-commerce expenses or the impact of channel transformation on distribution business sales, these developments seem to validate Wang Liangxing's earlier statement.
A review of CHINA LILANG's financial reports reveals that net profit declines have accompanied the company's transformation efforts over recent years. Financial data shows that from 2020 to 2022, CHINA LILANG's net profit declined by 31.19%, 15.99%, and 4.29% respectively, with 2023 seeing an 18% growth in net profit. However, in 2024, the company's net profit again declined by 13.1%.
CHINA LILANG positions itself in the business menswear segment and has been actively pursuing transformation and reform in recent years. At the end of 2020, the company signed popular writer and director Han Han, who enjoys significant appeal among young consumers, as its brand spokesperson, replacing previous spokesperson, renowned actor Chen Daoming. Additionally, CHINA LILANG sponsored multiple popular variety shows to bridge the gap with younger audiences. By the end of 2022, the company created virtual character "LI" to promote key products and showcase the brand's minimalist menswear philosophy, attracting young consumers' attention to the brand. In 2023, CHINA LILANG accelerated its youth-oriented transformation, including a comprehensive brand visual identity upgrade and clearly defining its "minimalist menswear" positioning, while heavily investing in the youth business brand LESS IS MORE.
In 2024, CHINA LILANG's transformation and reform efforts continued to deepen. In terms of product diversification, the LILANZ brand launched water-repellent down jackets and washable shirts using water-resistance as an entry point. Regarding multi-brand development, in August 2024, CHINA LILANG's joint venture company acquired ownership of the premium golf apparel brand "MUNSINGWEAR" in the Chinese market, entering the golf sports sector. In terms of channels, CHINA LILANG implemented channel transformation in 2024, increasing the proportion of DTC (Direct-to-Consumer) model operations, piloting the DTC model for the main "LILANZ" series in Northeast China and Jiangsu Province, replacing the previous first-tier distributor-operated model.
According to Zhou Ting, Director of the Customer Research Institute, business menswear brands need to continuously pursue premium positioning to break through current limitations. The business menswear market is shrinking, and only through premiumization can brands find development space and opportunities. Simultaneously, companies should increase product innovation, as business menswear can only achieve breakthrough by "originating from business wear but transcending business wear," with the key lying in product innovation. Furthermore, for CHINA LILANG specifically, the company needs to innovate its business model, transitioning from selling products to selling services and leveraging localized service advantages for customer operations.
Despite multiple years of transformation, CHINA LILANG's youth-oriented strategy and new retail initiatives have shown initial results. In its first half 2025 financial report, the company stated that "the 'LILANZ LESS IS MORE' light business series targeting younger consumers continues to operate under a fully direct-operated model. During the period, through the group's store image highly aligned with brand positioning and precise new retail marketing strategies, the brand achieved online and offline channel complementarity, better meeting target customer groups' purchasing habits, enabling the light business segment to maintain strong performance with revenue increasing 31.8% year-on-year."