Chapter 89 Export Strategy

If 1995 was a year of scuffle in the motorcycle market, then entering 1996 was a year of hard fighting. Pen @ fun @ pavilion wWw. biqUgE怂 infoWith the intensification of competition in the motorcycle market, price wars have come and gone, and state-owned motorcycle companies represented by Jialing and construction giants have begun to fall into difficulties, among which the construction of motorcycles is the most significant.

In 1995, the construction group also achieved the proud results of paying 480 million yuan in taxes and making a profit of 450 million yuan, and its sales volume also reached one million vehicles historically. However, in the first quarter of 1996, the sales of construction motorcycles began to decline sharply, falling by more than 50% compared with the same period last year. Last year, the sales volume of the warehouse type was pressed and the credit sales model caused nearly 800 million receivables, which occupied a large amount of corporate funds. When the market has turned to the mainstream of more than 90CC displacement, the construction motorcycle is still stuck to the 80CC displacement below, and the motorcycle produced is still ten years old, no matter how powerful CY80 is, it can't withstand the dilemma of not changing for ten years. As a result, when other manufacturers have launched competing products with more novel styles, larger displacements and higher cost performance, the products of construction motorcycles have begun to appear in a large area of unsalable.

Since there are nearly 10,000 retired workers, as well as hospitals and schools run by state-owned enterprises, the construction group has to bear at least 100 million yuan of capital expenditure every year. Based on the production of 500,000 motorcycles, the cost of each vehicle should be shared with the burden of 200 yuan. Even if it is a price war, it can't beat other companies, resulting in a vicious circle of more sales, more losses. Price reduction is death, operating at a loss; failure to reduce price is also death, inventory backlog drags to death.

The fundamental reason for the current situation of the construction group is that the product planning is unreasonable, the sense of smell to the market response is too low, and the ability to launch new products on the market and develop the market is too weak. When other private enterprises in Yuzhou have launched 90CC displacement motorcycles, state-owned manufacturers such as Jianshe and Jialing still hold on to outdated products and have not adjusted and updated their products in time. CY80 and JH70, as the ace models of the two major enterprises, have been fighting in the Chinese motorcycle market for more than ten years, and there is still no organization for upgrading. Therefore, in 1996, the construction group first suffered a sales downturn, and the situation in Jialing was not much better.

At the same time as the decline of Jialing and construction giants, the private motorcycle gang in Yuzhou began to grow in a big way, and the private motorcycle enterprises represented by Lifan, Loncin and Zongshen began to encroach on the market share held by the original state-owned enterprise giants by virtue of their flexible operating mechanism, no historical social baggage, low production costs and favorable conditions such as production and marketing.

However, Qingqi Group, which is also one of the three giants of state-owned enterprises, rose to the wind at the beginning of 1996, with the advertising placed in the prime time of CCTV, and the most important joint venture with Suzuki introduced by Suzuki GS125 model on the market, ushered in a hot market situation. In the context of the decline in sales of Jialing and construction, Qingqi ushered in a year-on-year increase of more than 20%, and this year's sales are likely to be the first in China.

After investigation, 5,000-8,000 yuan is the psychological price that Chinese people can accept for motorcycles, so the pricing of Huaxia motorcycles is mainly concentrated in this range. Compared with the sluggish response of state-owned enterprise giants to the market, Huaxia Factory's grasp of the market trend has always been at the forefront. What products are easy to sell in the market, Huaxia Factory will launch targeted products later.

Thanks to the launch boom of the Qingqi Suzuki King GS125, the corresponding imitation model of the Huaxia factory, the General series, has also won the attention of consumers. The price of Qingqi Suzuki GS125 is as high as 16,000 yuan, but it still makes young consumers flock to it, showing Suzuki's strong brand appeal. The Huaxia General series, which is only half the price of Suzuki King, has also attracted many consumers who can't afford to ride a Suzuki and switch to it.

In the fierce market competition, the motorcycle industry has a triangular debt situation due to the sale of inventory on credit. Sales enterprises owe production enterprises, and production enterprises owe parts supporting enterprises, and a large amount of funds are deposited in the circulation field, resulting in a shortage of working capital. The inventory cannot be sold, the sales company cannot return the payment, the production enterprise cannot return the funds, and the parts supplier cannot settle the settlement.

The triangular debt is a cancer that makes the people smell of the color, the first two years under the strong leadership of the state, the triangular debt that plagued the country was gradually cleaned up, and now the motorcycle industry has the signs of a resurgence of the triangular debt.

Thanks to the direct sales network established in the county as the grassroots unit in the country, Huaxia Factory has obtained sufficient cash flow by virtue of its own sales network, and has not incurred the dilemma of triangular debt due to arrears. The dealer network of the community of interests that is prosperous with Huaxia Factory is a powerful tool for Huaxia brand to develop markets and promote new products in various places.

The big brand of Huaxia brand has the strength to advertise in CCTV and other media, and it can also be purchased and repaired at the doorstep, and the products are constantly updated. Therefore, when other manufacturers felt the huge pressure of the market, the Huaxia factory still completed the sales in an orderly manner. Judging from the situation in the first quarter, after the official price reduction promotion, the year-on-year growth was slightly higher, and it was already a rare and valuable market treatment in the entire unfavorable market environment.

On the basis of the pressure on the domestic market, opening up new markets has become the key point for Han Hao. Although the state has repeatedly encouraged enterprises to go out and realize the export of products to foreign countries. However, in 1995, China's motorcycle exports were only 88,600, and the export products were basically foreign brands of joint ventures. For example, joint ventures such as Suzuki and Honda symbolically export some products from Chinese factories to Southeast Asia, in order to fulfill the promises made at the time of the joint venture.

Due to China's lack of foreign exchange, both automobile and motorcycle joint ventures have indicated that they require foreign parties to achieve a certain degree of export volume to help the domestic foreign exchange earnings. Therefore, this joint venture factory exports some products sporadically, or state-owned enterprises export products at low cost for political achievements, and there is no actual export scale. Therefore, in 1995, of the 7.83 million motorcycle production, exports accounted for only about 1%, which is almost negligible.

Han Hao set his sights on foreign countries and prepared to export Huaxia brand scooters to the outside world, where to choose the first stop?

Foreign developed countries are definitely not good, and now the products of Huaxia Factory are not suitable, and they are also facing patent barriers. According to the degree of economic development, the per capita GDP is in the range of 800-3000 US dollars, and the motorcycle industry will usher in a moment of great development. After looking around, Han Hao finally found that Vietnam is a very good export target.

Although it has been less than seven years since China and Vietnam officially ended the state of war, Vietnam has taken China's reform and opening up as a teacher, learned from China's policy of opening up to the outside world, and attracted foreign investment into the country. In 1995, Vietnam's GDP grew by more than 9.5%, with a population of more than 75 million, and it began to emerge as a major player in the economies of Southeast Asian countries. Vietnam is deeply influenced by Chinese culture, loves and hates the Chinese, and the national organization and social structure basically imitate China. For example, Vietnam is also a one-party country, and there is a "News Network" program in the evening, and the country is waiting to be revived, which belongs to a relatively large market. However, the biggest problem in entering the Vietnamese market is the policy factor, after all, just after the war, Vietnam's attitude towards Chinese goods is very easy to cause boycott and resistance.

Han Hao decided to personally visit Vietnam to see if he could realize the desire of Huaxia factory to export to Vietnam. It has nothing to do with Vietnam, you need to find a guide to help. So, the old friend Li Guoan came in handy again, and Han Hao took the initiative to contact him and ask him to help match.

"Export motorcycles, but also to Vietnam?"

As a senior reporter of Xinhua News Agency, he has been immersed in the automobile and motorcycle industry for many years and knows the trickiness of it. Although China's motorcycle production has ranked first in the world year after year, its export performance is really not worth mentioning.

Despite the state's strong encouragement of exports, the domestic market is so large that the state-owned giants are busy competing for domestic market share and are not interested in foreign markets. Unexpectedly, Huaxia Factory, as a private motorcycle company, was the first to take the initiative to ask for crabs to be exported to the outside world.

"After looking around, I found that Vietnam is more suitable, which is very similar to the situation in China in the previous two years, and I think there will be a wave of motorcycle development frenzy. The domestic competition is too great, since sooner or later we have to go abroad, then take advantage of everyone's lack of reaction, our Huaxia factory will go out to test the water first. ā€

Han Hao and Li Guoan are already very familiar, so they don't hide too much when they speak.

"Your vision is good, alas, I recommended export strategies to the CEOs of many large factories before, but they were all thunder and rain, and now it seems that you still have to rely on your Huaxia factory to lead the trend. ā€

With the help of Li Guoan, Han Hao led the Huaxia Factory and his party to Vietnam to officially inspect the country bordering southern Xinjiang.

When he came to Hanoi, the capital of Vietnam, Han Hao found that it was indeed similar to the situation in China a few years ago, and motorcycles were the main means of transportation for local city people. When he came to Hanoi, Han Hao seemed to have arrived in the capital of a province in the southern part of the mainland, except for the high-rise buildings, which rarely spoke Vietnamese with the people around him, and there was not much difference from the southern Chinese cities.

Looking at the local motorcycle brands, almost all of them are occupied by the Japanese A brand, and the four kings of Suzuki, Honda, Yamaha, and Kawasaki are complete. Due to the narrow domestic market, under the support of the government, the products are mainly exported. Vietnam, as one of the major countries in Southeast Asia, naturally cannot escape the occupation of the Japanese brand. Coming to Vietnam, Han Hao also has a deeper understanding of the influence of Japan's economy, and his products are not only invincible in the Chinese market, but also dominate in Southeast Asia. In addition to motorcycles, Han Hao also looked at cars, unfortunately it is still the world of Japanese cars, Toyota, Honda, Suzuki, Mitsubishi, etc. occupy all the roads, and occasionally you can see some Korean Hyundai and Daewoo brand cars. As for the motorcycles and cars of the Chinese brand, they are simply nowhere to be seen.

Watching TV in the hotel, if the news is not spoken in Vietnamese, it is basically a copy of the domestic news broadcast. Television advertising is a bit poor, and many of them are run by foreign brands, with Japanese companies making up the vast majority.

With the help of the Chinese Embassy in Vietnam, the Huaxia Factory and his entourage got in touch with the Chinese Chamber of Commerce in Vietnam to try to see if there were any opportunities for cooperation between the two sides.

In what way the motorcycles of the Huaxia factory entered Vietnam, whether they were purely imported or assembled in a local factory, whether they were a Huaxia brand representing the Chinese background or another name brand, and whether they needed to copy the domestic dealer model, etc., all need to be carefully demonstrated.

However, Han Hao can be sure that Vietnam is indeed a motorcycle market with great potential.