The 2021 China Construction machinery marketing & Post Market Conference officially kicked off on November 29. This conference gathered highly influential people in China's construction machinery industry, built a high-level communication platform, focused on "adhering to axiom", discussed many opportunities and challenges in the process of adhering to it, and contributed valuable and knowledgeable wonderful exchanges, in-depth collisions and solutions, Together with my colleagues, I will observe the current situation and look forward to the future.
In 2021, China's construction machinery industry will develop well and it will be difficult. This era not only gives the construction machinery industry the opportunity to flourish, but also faces challenges such as uneven development of all parties in the industrial chain. The overall high-quality development of China's construction machinery needs to shape and give play to the core values of all parties. Therefore, the organizers of 2021 China Construction machinery marketing & Post Market Conference specially planned this summit dialogue with the theme of "adhering to axiom", in order to help China's construction machinery industry open an innovation Bureau in the changing situation.
The summit dialogue was presided over by Fu Yaosheng, CEO of lixingxing machinery group. The dialogue guests were Qi Jun, honorary president and special consultant of China Construction Machinery Industry Association, Wen Wu, vice president of Guangxi Liugong Machinery Co., Ltd., Zhou chijun, chairman of Hefei Xiangyuan Construction Machinery Co., Ltd., Chen Tianyu, CEO of Anhui xiansong Construction Machinery Service Co., Ltd. and Hitachi construction machinery (Shanghai) Cheng Xiaoming, managing director of the company (online).
2021 China Construction machinery marketing & Post Market Conference
The second part of "summit dialogue" adheres to value
In the second theme of the summit dialogue, "stick to value", guests had an in-depth dialogue on industry focus topics such as how Chinese construction machinery enterprises will adapt to the great changes in the industry and market, stick to and shape their own core values in the industrial chain.
Fu Yaosheng: in 2021, the market sales of excavators and loaders were high before and low after, which has declined for seven consecutive months. At the same time, the export increased significantly year-on-year. What is the next trend of the industry? How will enterprises adapt to this change strategically and stick to and shape their core values in the industrial chain (what to give up and what to stick to)? The improvement of industry concentration is an unavoidable trend for all parties in the industrial chain. Please talk about the possible integration of the industry in the next step.
Wenwu: This is a sharp topic. From my personal point of view, this industry has entered a downward cycle, and the total decline is an inevitable trend. However, due to the introduction of macro policies for rural revitalization, I believe that the downward trend in the next cycle will not be as radical as that in the previous cycle, and it is estimated that it will be in a relatively gentle downward state.
In such a situation, especially as a host manufacturer, I very much agree with the theme of "adhering to axiom". Liu Gong has always been an advocate and practitioner of axiom. Chairman Liu Gong said that "the strategic focus of Liu Gong is always technological innovation". Liugong has experienced nearly five generations of iterations from the first loader to the current 856h series and excavator in the past 63 years, and is still famous for its reliability and energy saving. At present, Liugong's "11.26 customer Festival" is under way. The customer Festival shows Liugong's most front-end products, from complete sets of electric drive products to remote control products, as well as three newly released driverless construction machinery, which reflect Liugong's value proposition of "creating better value for customers". Liugong has been expanding in product R & D, technological innovation, core parts and good services. Quality determines the future, and Liugong has always adhered to it.
The second is to have cycle thinking under the general environment of the industry. When the industry is good, how should we think calmly? When the industry is declining, how can we have a layout that breaks through the industry cycle, including the layout of machinery and manufacturing, and how to layout in operation and find new growth points to ensure the steady and stable growth of finance.
The third is what Liu Gong has always insisted on. If Liu Gong wants to get a good reputation in the industry, he should not only rely on himself, but also on the industrial chain. Then the industrial chain includes our customers and dealers. We should have this altruistic thinking to become a community of destiny. Therefore, first of all, let customers recognize the value of the enterprise, and then in terms of policy and orientation, the enterprise and dealers can really stand together. Of course, the game is inevitable, but the strategic intention should be consistent and the interests should be relatively consistent. We must have a quality game and seek a certain balance. We believe that building such a community of interests is the win-win thinking that enterprises should have at present.
As a loader in recent years, what I feel deeply is customer orientation and altruistic thinking. I believe that in this way, the dealer will stand with you and we can keep warm when the industry is declining.
Fu Yaosheng: according to your counter cyclical statement, we also see many foreign brands. They also have a so-called counter cyclical strategy, which is a strategic arrangement, that is, what to do with the good and what to do with the bad.
Cheng Xiaoming: I am a veteran of the industry, but it has been less than four years since I returned home. My experience is that every industry always has peaks and valleys, and there are cycles of development. For this cycle, first of all, from the perspective of the enterprise itself, it is actually two things: first, customer interests first. How can we take the interests of customers not only as a slogan, but also from the whole strategy, operation and management framework of the company, including the industrial chain, how to put customers first. For me, customer first is very simple, such as who is the customer and how to define it. Dealers are customers, and we are the representatives of Chinese dealers. Therefore, as a manager, you should be able to accurately locate customers in order to serve customers. This is the most fundamental reason why a century old enterprise can continue.
Second, Hitachi Group has a history of more than 100 years. Hitachi advocates to provide customers with a reliable subject solution, stick to the right path, be honest and do things in a down-to-earth manner. By providing reliable subject solutions for customers in a down-to-earth manner, we can realize the first interest of customers.
Personally, I think the savage development of the industry is better than the savage integration, because the development process is a time period process, and according to the needs of customers, a big pig can fly. But without strategic thinking, this brutal integration will lead to the collapse of the whole market. First of all, it is the integration of ideas. No matter whether a company is upstream or downstream of the industrial chain, it must have the same idea. Second, based on the concept integration, there must be strategic integration, and there must be strategic guidance for the planning of each step. Third, in order to realize this strategy, how can the operation management system make the best use of resources. Fourth, product complementarity and channel integration, including domestic and overseas. The most critical point is that there must be talents. In particular, there are enterprise talents who can be altruistic and stick to the right path. They must work within a certain framework, so talents should be the most critical link in all industry integration.
Fu Yaosheng: customers first, agents are also customers, stick to the right path, integrate ideas and care about talents. Mr. Zhou, will the agents integrate?
Zhou chijun: in fact, the integration of agents has begun in the past two years. Looking forward to 2022, it may be more difficult for us. On the one hand, the total market demand is declining. On the other hand, in the climax of the industry, the demand of some manufacturers has not been integrated. The biggest relationship integration is the relationship between supply and demand. I hope agents must be fully prepared. With the huge output of construction machinery and the impact of the epidemic on the markets outside Shanghai, the domestic market will bear great pressure in the end.
I'm also thinking about what our agents can undertake, but agents can achieve 100 points in everything. Some have no basis for real competitiveness, or there are no indicators of formal growth momentum. What they should carry should be carried. Either they complete the task or good agents. If they carry what they can't carry, they will fall to the ground one day.
Looking forward to 2022, as agents, they pay more attention to the health of their own enterprises and think about problems from the perspective of enterprise strength. What should they do about the problems they can't carry? In other words, many unsolvable problems may require agents and manufacturers to communicate and discuss solutions, less confrontation, more rational communication and growth.
Chen Tianyu: stick to value from the perspective of pure service providers. At present, the excavator industry has entered a stock market. After listening to what the general manager said just now, his development direction should be high-end, scientific and technological and intelligent. At present, agents are in the process of changing from incremental market to stock market. With the increasingly fierce competition among agents, we want to find the internal strength of the enterprise, that is to find the internal energy and make some changes in this place. From the 13th five year plan to now, Internet technology has had a great impact on the industry, but it is also a process to keep us from returning to the original market. However, no matter how the market changes, I still hope my colleagues can get energy from self-change. Enterprises should make a choice. For service enterprises, if they only continue the existing service model, the space will be smaller and smaller. They must look for greater connections. At the same time, we must give up some extreme customers. Every enterprise must adhere to its own values and stability. Stability is very important. The service stock in the post equipment market is now too large, and the projects that need supporting connection are too complex. Whether it is the OEMs, agents and service providers, we need too many connections to the whole market service. For example, insurance companies, human resources and accessories (including reverse logistics and transportation) are some enterprises that we need to consider integration to improve the whole market.
Fu Yaosheng: from 2020 to 2021, although the sales volume of construction machinery products increased, the intensity of market competition further improved, and the profitability of many agents was not optimistic. What was the reason for this situation? How do you view the development of agency system in China? How do you think agents need to build their own competitiveness system? At present, there is also the withdrawal of agents. What do you think?
Qi Jun: first of all, the theme of today's conference "stick to axiom" has been raised to a very high level. Today's entrepreneurs have the goal of pursuing, that is, the enterprise they are engaged in is evergreen. Evergreen means the healthy and sustainable development of an enterprise:
First, manufacturing enterprises. I appeal to manufacturers to be kind to agents. From the perspective of discourse power, agents and manufacturers are vulnerable groups when they are together. Sales in the construction machinery market is the most critical factor to determine the survival of our industry.
As the tentacle of the manufacturer's market front line, the agent goes deep into the front-line users and provides close service for users. If the manufacturer can't do it, our agent will be in place in two hours. However, if the function of the agent is managed and realized by the manufacturer, the manufacturer will have a lot of pressure. At the same time, the evaluation of agents by host manufacturers should not only take the growth of market share as a heavyweight evaluation index, but should be multi-dimensional. For example, the number of old users lost and the number of new users developed by agents are assessed, rather than the number of market share growth. Due to the previous assessment policy, it has caused a series of chain reactions in the market.
I hope the main engine factory can do three things: first, make the product technology the front end; Second, the reliability and quality of products should be maximized; Third, provide all-round support and services to agents.
At the same time, also called on agents. Losing money is not conducive to the development of agent enterprises, but also disrupts the development of the whole construction machinery market. Up to now, the sales volume of excavators from January to October in 2021 has increased by 13.1% compared with that of last year, but the main growth this year is mainly in export. The export of excavators from January to October has exceeded 60000, and the export of all construction machinery products has increased by more than 89%.
I think there are three kinds of money. First, earn money by brain, such as Bill Gates, earn money with a system; The second category is to earn money by money. I inherited my inheritance and put it in the bank to earn interest, lend and borrow money; The third category is working to earn money, working for the boss to earn money. Agents don't care about profits, but don't lose money. However, we all have a clear understanding that price war is inevitable. As long as there is a market, this is the Jianghu, and there is the law of the jungle. In this price war, how to survive the fittest and how to live healthily.
According to personal analysis, it will be a painful period for the construction machinery industry from December 1, 2022 to the first half of 2023. After December 1, 2022, "national four" standard switching. Especially at the end of the second quarter and the third quarter of 2022, the industry may usher in a sales climax. Because after the "national four" standard is switched, the price rises, and before that, users will rush to purchase. Second, there is no exit mechanism in the industry, that is, the "national four" standard has been switched. The "national one" standard was launched in 2008. Hundreds of thousands of equipment produced before 2008 are still in use in the market. The association is now actively making suggestions to the national development and Reform Commission and the State Council to establish a compulsory exit mechanism for second-hand equipment of construction machinery, but it is very difficult. Because now there is the property law, 90% of the excavator customers of construction machinery are individuals. These construction machinery belong to personal assets and cannot be forcibly scrapped. Like cars, the state forces you to scrap, and the state gives subsidies, while construction machinery does not.
I hope our agents will follow the market law, grasp themselves and stick to the value.
Fu Yaosheng: Liugong excavator has adopted the direct sales mode in recent years. Can you tell us why Liugong adopts this mode? What characteristics do you think this model has? At the same time, how to layout the post market development? In the agency mode, agents will share part of the risk in the sales link. In the direct mode, will this risk bring pressure to the host manufacturer?
Wen Wu: this question is very targeted. Liu Gong sticks to the axiom and supports the development of agents. Liu Gong did make some attempts in direct marketing a few years ago. Under what circumstances did he make this attempt? Basically, there are problems in local channels, and the channels are unsustainable (including lack of confidence and willingness). Under such circumstances, Liugong has explored this model directly operated by us in several regions. Judging from the situation in recent years, this exploration should also play a certain role. Where does it work? Is to meet the needs of customers and enhance the local influence of the brand. Moreover, in this process, we also learned about the operation mode of the channel, its operation characteristics and pain points, which have played a very good reference for the win-win cooperation and empowerment between our agents in the future.
Liu Gong has always adhered to the marketing model of focusing on agents and supplemented by direct sales. The policy of Liugong channel is to continuously meet the needs of customers and maintain the strategic intention and enterprise spirit between agents and Liugong. This is the core value Liu Gong has always adhered to - "people-oriented, cooperation to create value". At present, Liugong is also constantly trying to innovate some models, such as mixed reform, equity reform, business model innovation and so on. Here, I hope that the agent friends who have the ability, confidence and willingness to Liugong can also participate in the innovation and reform of Liugong.
Fu Yaosheng: in China's excavator market, the market pattern of various brands has changed greatly, especially the market share of non domestic brands is gradually shrinking. As a Japanese brand, how to deal with this change and pressure?
Cheng Xiaoming: now the market share of foreign capital is declining. I think there are four key words to survive. First, customers first. We have the right to choose customers, but customers must decide the products and corresponding services we provide. Some problems are solved by customers. Customers must determine our rise and fall, so don't reverse the relationship. This is the first point.
The second key word is to focus on value creation. Our sense of existence depends on the value we create. Without value support, our sense of existence will eventually disappear. Now the chaos in the industry is that value equals price. I often tell some large-scale customers of the mine that I have added many customers after doing so many years overseas. To sum up, there are two things we should do to become a 30-year enterprise, a 50 year enterprise and a 100 year enterprise: one is to make sustainable money, and the other is to manage invisible costs. Therefore, in terms of foreign investment, we should make more use of some experience accumulated overseas to provide customers with value beyond price, which is our second point.
Third, it is a cause of sustainable development. The sustainability of the cause must depend on the value creation to adapt to the trend. We are also doing it now. No matter what the channel becomes, its leading mode must be from upstream to downstream, from the client to the factory R & D end. There is no sustainable profit model, and we can't support it.
The fourth point is about the so-called win-win, coexistence and common prosperity. Customers and agents, manufacturers and suppliers, capital and employees must first win-win in order to coexist. With coexistence, everyone can prosper and can't be reversed.
Fu Yaosheng: most agents feel that this year's life is difficult. As an excellent representative, do you think the agents have reached the node of transformation? How to achieve a breakthrough in their own business?
Zhou chijun: it's not about transformation, it's about living. It touches our lifeline. No matter how weak the agent is, the minimum legal bottom line must be adhered to. For example, the industry should abide by the anti unfair competition law. Long-term malicious low prices are suspected of low-price dumping, and long-term losses should not be considered. Partners should also respect each other and everyone has dignity.
Agents should achieve more accurate communication with manufacturers and understand the real requirements of the core leadership of the enterprise. Nanchang is a blessed place. With more and more construction machinery main engine plants becoming listed companies, I believe that enterprises and industries will become more and more standardized and bring more vitality to the industry.
On the contrary, agents have a common sadness. For 20 years, how many listed companies have construction machinery agents in a shares? The top channel enterprises in the automotive industry are listed companies. We should reflect that we should communicate with foreign countries and let more people pay attention to this group. Looking forward to the "14th five year plan", we will defend our rights and interests with a more open and positive attitude and highlight the value of agents.
Fu Yaosheng: how to improve the relationship with manufacturers?
Zhou chijun: by the end of the year, next year's indicators are terrible. I think a key to improving relations is not to easily take on tasks that cannot be completed next year.
Fu Yaosheng: as an expert engaged in the post market service of construction machinery for more than 20 years, what do you think is the real post market technical service? In terms of key customer service, how to embody the value of technical service from equipment life cycle management?
Chen Tianyu: I have three views: first, service-oriented enterprises must eliminate homogeneous development and build what their own enterprises do. This is the core value. Second, we are positioned as high-end equipment. In the next step, we may need to be recognized by many parties, such as large equipment of brands such as Liugong and sany. I plan to expand to these fields in 2023. Third, it is our belief that we should create value for customers. Only with this belief, we don't have to worry about being eliminated, because customers will always stand with you. If any enterprise is eliminated, there is only one problem, that is, user service.
Let me give an example. For the benefits of rice cookers, technical service providers should choose the best brand of rice cookers and look for organic rice and purified water, but what really works? It is to keep supplying power to the rice cooker. When the electricity stops halfway, the rice can't be eaten. Therefore, the service provider's service to a large customer and large equipment is like supplying power to the rice cooker. It keeps supplying power. The customer can't cut off power for a day without eating.
In this sense, we must be irreplaceable. The only thing that can not be replaced is to better meet the needs of users, and create value for your users in a down-to-earth, focused and focused manner, so as to make profits naturally.
