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B2B business strategy: Huida's "second curve"
Issuing time:2020-09-28     Number of times read:     Font:【BigInSmall

In the future, the enterprises of home furnishing industry should not only strengthen the development of commercial (b-end), but also make strategic preparations to make the commercial (including engineering) market surpass the civil market.

Is the blue sky of Beijing related to the strategy of enterprises? yes , we have.

Recently, I went to Beijing and saw the blue and blue sky. I can't help feeling "is this still Beijing that worked hard for a blue sky in 2008?"? In only ten years, "haze" has almost disappeared from being a negative word frequently associated with Beijing. At that time, some environmental governance experts cited the example of London to prove that it would take about 30 years to control environmental pollution. I once said that if the government really paid attention to it, it would only take half of the time at most. indeed.

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This is the "China speed".

"System effect": the accelerator of China's economic growth

How did China's speed come into being? One of the most typical statements is the efficiency of the system. We can concentrate our efforts on major events, and for development, we can sacrifice things that seem less important at a time; we also dare to catch up and accelerate the expansion, upgrading and even iteration of the industry with social mobilization. There is another saying hidden here: regardless of the cost, for example, in only 20 or 30 years, our investment in infrastructure and achievements have caught up with the developed countries in the West. The essence of business is cost and efficiency, and our system has obviously played an extreme role in both.

Now, our strategic goal is at 5g. It is known as the third technological revolution after the industrial revolution and information revolution, and mankind will usher in an intelligent society. China has been determined to take the lead. In March 2020, China resolutely launched the "new infrastructure" national investment plan. It plans to make use of the advantages in the field of scientific and technological innovation, face the future large-scale investment in intelligent infrastructure, and continue to lead the release of dividends brought by infrastructure ahead of time.

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"New infrastructure" is known as a sustained driving force that can "support China's economic and social prosperity and development in the next 20 years". Its main investment fields mainly include: 5g infrastructure construction, UHV, intercity high-speed railway and intercity rail transit, new energy vehicle charging pile, big data center, artificial intelligence, industrial Internet, etc. The investment scale is expected to be no less than the infrastructure plan of 2008, and the total planned investment announced by eight known provinces has reached 33.83 trillion yuan. Although the new infrastructure focuses on "new" and innovative technology based on 5g, the scale of hard investment brought by the new infrastructure can not be underestimated, and the economic effect is encouraging.

On September 10, the author attended the "2020 new infrastructure and livable China Annual Forum" held in Beijing, and discussed the industrial Internet blueprint of construction industry with Mr. Zhang Ming, chairman of Lianyi group, and deeply felt the confidence and determination of private investment in the future. This is a comprehensive mobilization from top to bottom, from government to society, from industry to terminal. The system effect will be launched again, with the goal of intelligent interconnection represented by 5g to comprehensively promote and even lead the third wave of industrial revolution. Will China take the lead in this competition? My answer is "sure.". Because under the system effect, the intelligent revolution that might have taken 50 or 60 years to complete in the world may take the lead in China in 10 or 20 years!

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Should the government withdraw from the market? Or should the government transform into a "service-oriented" function in the future market economy construction to build an innovative country? In the western economic theory, this seems to be absolutely politically correct, but they forget (perhaps they don't understand) the characteristics of China: in the 2000 year long historical process, China is basically unified, and the government has always been the leading role in economic development; people have fundamentally recognized and used to such a role in culture, and how difficult it is to take the initiative to disappear? And why should it "disappear"? It was originally an important existence in social and economic life. It has achieved such great success in the past 40 years. Why can't we believe that it can still lead us to greater success in the future?

I once had such a feeling in a diary: "the role of government and market is not the existence of" zero sum ", but the integration and coexistence of" Yin and Yang ". For quite a long time, the role of the government will be the key to the construction of a market economy, which should not be questioned. "

This kind of existence includes: the relevant industrial economic policy planning; the government's own procurement and consumption and the investment led; the role of state-owned enterprises in the economic foundation; the strong driving role of relevant institutions and social teams. Taking the assembly industry revolution in the construction industry as an example, this policy has a profound and huge impact on the construction, real estate, home furnishing, decoration and related supporting industries of hundreds of trillion yuan. "System effect" is the accelerator of China's steady economic growth.

Therefore, I wrote an article last year to remind pan household enterprises that "it is time to vigorously start the b-end strategy", that is, to attach importance to the centralized procurement business of construction projects with real estate as the core. Now I would like to add my point that enterprises should start their own B2B business strategy. This business includes government procurement, engineering procurement, key customer procurement and enterprise procurement. The reason why we regard it as a strategy rather than a tactic to improve short-term performance is that for a long time in the future, policy is an important variable affecting economic development, and even an important trading market. The scale of the latter is so large that as long as enterprises attach great importance to it and persist in cultivation, it is not difficult to continue to usher in the same rapid growth of performance as in the past. This point has been exposed in several Pan home companies with significant performance growth.

B2B business: the best path of the second curve

On September 11, Mr. Wang Yanqing, President of Huida Sanitary Ware Co., Ltd., proposed that Huida was speeding up the establishment of another national channel -- a sales network for real estate engineering and tooling, I clapped my hands. Huida is a leading sanitary ware enterprise. It has always been an outstanding representative of export sales in the sanitary industry. Since 2009, Huida has strengthened the domestic market and achieved remarkable results in ten years. It has not only established more than 2000 exclusive stores in China, but also realized the first A-share main board listing of comprehensive sanitary ware.

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In my opinion, Huida sanitary ware is on the right path of transformation and upgrading. From export sales 20 years ago to domestic retail sales 10 years ago, and then to projects in the next 10 years, I would like to regard it as Huida's commercial marketing network, and suggest that it should be promoted to the business strategy of enterprises.

In fact, Huida has already done this, and started such a strategic layout two years ago. In 2018, Huida announced the establishment of Huida Residential Engineering Co., Ltd. (hereinafter referred to as "Huida residential workers") with a total investment of 1 billion, aiming at the upgrading of home furnishings brought by the industrial transformation of clothing matching buildings. Facts have proved that this fall is quite far sighted. With the rapid opening of the production base, Huida residents jumped out of the nest of traditional bathroom industry competition, and quickly opened a huge blue ocean market which is explosive growth.

What's more, it in turn prompted Huida sanitary ware to shift its focus from brand retail to both retail and engineering markets, indicating that Huida bathroom is entering the full implementation stage of b-end commercial strategy.

In my opinion, in the future, enterprises in the home furnishing industry should not only strengthen the development of commercial (b-end), but also make strategic preparations to make the commercial (including engineering) market surpass the civil market.

For a long time, due to the primary level of marketing (mostly relying on relationship) and the imperfection of the domestic legal environment (difficult to collect money and court enforcement), B2B (B2G, government procurement) market has always been characterized by low-level, chaotic and even illegal behaviors, which make enterprises in southeast coastal areas open earlier and have a higher degree of marketization stay away. Now, the three key issues affecting this market have been greatly eliminated: the relationship is gradually giving way to the professional, because it is good for the enterprise in the long run; the law is helping to establish norms strongly and effectively, and Lao Lai's space is getting smaller and smaller; and the sustained efforts to combat corruption in China are bearing fruit. Therefore, the value of this huge market is gradually highlighted. Moreover, with the vigorous promotion of economic internal circulation and the establishment of a high standard market economy, the prosperity of b-end market will be greatly promoted.

In the 1950s and 1970s, IBM was the leader in the computer industry, almost synonymous with "computer". In the 1980s, IBM was still brilliant, but at the same time, IBM opened up a commercial route, provided software and hardware for medium and large-scale systems, and found a market worth 500 billion US dollars. It is thought that IBM was on the verge of bankruptcy when it sold its personal PC business to Lenovo in 2005. In fact, IBM is soaring through its business strategy.

The same is true for multinational companies such as Nokia and Panasonic. Despite major setbacks in the field of personal consumer goods, Nokia is now becoming an important player of 5g and still ranks in the world's top 500. Panasonic has transformed into B2B fields such as vehicle, residential and components since 2012. In 2019, it has set up automobile electronics and electromechanical systems company, household appliance cooling and heating equipment company and Internet Solution company and environmental solutions company are the four social companies. In the future, these four companies will be expanded into seven major enterprises.

It can be seen that in these multinational companies, the commercial (B2B business) strategy has not only become a solid backing for the growth of enterprise performance, but also an important support for these enterprises to radiate the second spring and open up the second growth curve.

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In the past 40 years, the prosperity of the civil consumption market for C-end has been supporting the rapid development of enterprises. In the next 40 years, this market may further grow, but the competition will also be fierce; correspondingly, the large market oriented to b-end or occupied by low-intensity competition has become an area of high-speed performance growth. Therefore, enterprises should not regard it as a supplement to performance, but as a long-term strategy to regain new growth.

Of course, based on the long-term important role of policies and the government in the future economic construction, during the meeting in Tangshan, I solemnly put forward suggestions to President Wang Yanqing. In addition to setting up a vice president for key customers, I should also set up a senior management post in charge of government relations and public affairs.

Author Duan Chuanmin (Strategic Marketing observer)

 
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