Hering plays on several fronts to try to get out of the crisis

São Paulo-even before the market could talk about something else, the word crisis has built the day-to-day of Hering.
The yellow light is kindled on the balance sheet of the company in 2012, when the brazilian economy still grew.
After six years of uninterrupted growth-which led the retailer to be a "sweetheart" of the stock exchange, with market value of R $ 8 billion, the company began to lose strength and only saw the results get worse since then.
From 2013 to here, the company has been working on solutions to reverse the picture, that task has been made difficult-and-by the current retraction in consumption.
In an interview with the newspaper O Estado de s. Paulo, President of Cia. Hering, Fábio Hering, admits that the current problems of the company catarinense, founded 135 years, are not only related to the economic crisis.
For the Executive, Hering needs to reinvent itself. The effort to turn unfolds on several fronts: the company is working on product line, to run just the old basic t-shirt; the logistics and the relationship with franchisees, allowing retailers to receive smaller amounts of merchandise, preventing much of the stock must be sold in liquidation; and the layout of the stores, which undergoes modernization.
For now, the Executive admits that the changes have had no effect on the balance sheet.
With the recession, sales in stores open more than a year-one of the main thermometers to retail-sector analysts fell 5.5% in the first quarter, the worst recent company results. Revenue in the period stood at 376 million R$, lowest level since 2011.
The profit from January to March, to 29.3 million, R$ is equivalent to less than half of the result obtained in the same period in 2012. Although the numbers have worsened, the company can''t afford to stop, according to its Chairman.
On the contrary: the order, right now, is to put your foot on the gas. According to the retail analyst Bank Brazil Plural, William Ahmed, even though his results have deteriorated and efforts to reverse the negative path are not having an effect, the Hering is considered a relatively privileged business in the retail industry.
That''s because the company generates profit and box, while midsize competitors-such as GEP, owner of Luigi Bertolli-had to resort to judicial and other giants such as Marisa, already operating for some time in red.
Are bookings of the season lull that allow Hering do investments in the midst of the economic crisis. The company will spend $ 30 million now to pay for the renovation of almost 100 of their franchises in the next 12 months.
The company will pay 25% of the investment and finance the rest for partners in 12 times without interest-a typical business from father to son.
According to market sources, the company had to put his hand in his pocket, with sales falling, it would be difficult to convince franchisees to make that investment.
"The franchise system reduces the speed of change in stores," says analyst Luiz basket, of Banco Votorantim.
More brands
Another challenge for the company is getting rid of its strong dependence on Hering''s brand, which still accounts for 75% of its sales.
In addition to the 648 units own and franchise across the country, the products of the brand that baptizes the Group also are distributed in more than 13 1000 multi-brand clients.
"Our goal is to reduce the dependence of Hering''s company for 50% of the revenue," says Fabio Hering.
According to market sources, it will be difficult to be done with the brands that the company already has in hand.
The Hering Kids and the PUC, despite performing high in sales, are in a children''s segment, which represents a small portion of the fashion retail.
Already the Dzarm became "dormant" for several years and today has three stores in operation in the testing phase.
The Hering for You, launched three years ago with the hope of being the kickoff for a women''s network, is being discontinued and your collection will be incorporated to the units of the "brand".
One of the outputs to accelerate this process of reducing dependence on Hering might be the acquisition of brands, says the Executive, without specifying a potential target.
Fábio Hering admits that while the company was already working on the turnaround of its business for nearly four years, there''s a lot of work to do.
But the company is not a rookie in radical transformations. Since the '' 90, made deep transformations both in industrial area-most of the factories was transferred to Goiás, which offers incentives for textile industry-as well as commercial.
The manager tells us that before the Hering, the company could barely account for its customers. "We were selling millions of pieces, by wholesalers, and were present even in supermarkets," he recalls.
Despite the size of the challenge ahead, Hering has a point in its favor: the willingness to change.