Liu Jinbiao, A Bicycle Magnate: The Theory Of Sustainable Management Of Manufacturing To Brand

Editor's note: over the past month or so, one of the most striking news of the company is that China's largest sewing machine manufacturer is leaping over the dilemma of insolvency of the group. It has become another sample of "made in China" in the upgrading process.

Sewing machines and bicycles are "luxury" in the eyes of Chinese consumers for a long period of time. Then, with the improvement of domestic productivity and consumer purchasing power, they enter the industrial maturity stage or even decline period.

Similarly, from the manufacturing of products, why can Taiwan achieve the brand position of the world's first bicycle in the development stage from "manufacturing to brand", and China's leap sewing machine is in the predicament of capital chain breaking?

Liu Jinbiao, the founder and chairman of the giant group, John, Huang Chenxia, May 29th, just arrived in Monte Carlo. Liu Jinbiao, the founder and chairman of the giant group, told Giant, which is responsible for the European sales business of the company, from Giant nice, which is about half an hour's drive from Monaco.

On the next three days, a mountain bike and a road car caught a spotlight on the balcony of a conference room in the hotel where he lived.

Liu Jinbiao came to Monaco as a representative of Taiwan entrepreneurs to attend the annual conference of Ernst & young entrepreneurs.

In his view, this is undoubtedly an opportunity to enhance and enhance brand awareness and reputation.

Because in the next three days, entrepreneurs and media from all over the world, including him, will frequent this place.

It is Liu Jinbiao's business habit to sell at any time and anywhere.

Liu Jinbiao, now 73 years old, began to form and internalize his personal understanding and understanding of brand after 50 years.

22 years ago, Liu Jinbiao, a maker of bicycle OEM, realized that the risks of foundry had become the focus of Giant's own brand Giant.

In 2007, a huge turnover of more than 1 billion dollars, 70% of revenue from private brand "Giant" sales, 30% of the revenue mainly from the OEM business, from the perspective of turnover, Giant has become the world's first bicycle brand.

For 20 years, Doug has passed through the development stage of the company called "no man".

Liu Jinbiao, a "opinion leader" who initiated the component revolution and looked back on entrepreneurship, regarded the "self" before 1972 as "a youth without qualitative determination".

Before that, he averaged 2-3 years for an industry, canned flour, wood, screw, pportation, eel and other businesses. He tried it one by one.

At that time, he was very young, full of energy and perseverance, so he changed his profession frequently.

Looking back on that year, Liu Jinbiao felt lucky. "No success or failure, it was a normal ending. My career did not fail."

Because of the "nothing" and the uncertainty, he began to realize that "no longer be capricious". He finished his last business around 1972. He chatted with his friends at Taichung for a chance to do business.

In the Gulf oil crisis, the president of the United States promoted bicycles to the public and the bicycle boom in the United States.

On the other hand, the manufacturing industry began to pfer from Europe and America to Taiwan, Korea and other Asian regions. Taiwan is one of the bases for bicycle outsourcing production.

After dinner, Liu Jinbiao and other 8 people decided to invest in building a bicycle manufacturing company, a giant mechanical Limited by Share Ltd, which is now a giant group of Giant's parent company.

At the beginning of the company's establishment, there were only 4 million NT dollars in registered capital and 38 workers.

"At that time, because there were many orders from the United States to Taiwan to find OEM, many people in Taiwan entered the industry.

But the quality of the product was a mess at that time, and there were many complaints and complaints from consumers in the US market.

After careful consideration, Liu Jinbiao found that the root of the quality problem was the lack of parts production standards. "For example, the screws and nuts do not match, the tire and rim do not match, and the result is not loading up, that is, bursts after loading."

At that time, Taiwan did not set up a set of industry standards for bicycle production, and parts suppliers were in their own hands. No one compromised, and no one tried to change the status quo.

"I realized at that time that bicycles must work hard from spare parts when they really want to do well."

Thus, in the early days of the company's establishment, Liu Jinbiao dealt with parts factories most of the time and persuaded them to achieve standardization of parts and components together.

The problem of uneven parts specifications in Taiwan was a bit difficult.

"There is no weight for anyone to speak, not to mention that my company had only 38 people at that time, and it was also a novice with no industry background."

Liu Jinbiao said.

In the past year, Liu Jinbiao was in vain. He was not too willing.

In 1973, he went to Japan to understand the industrial standards of Japan and returned to Taiwan. He brought a book from Japan about JIS (Japanese industrial standard) and continued to convince the industry owners of the monks.

"Many industry owners are moved by my enthusiasm.

The older generation in some industries began to speak for me and said, "Liu Jinbiao is a very good person. He has worked hard for the development of the industry. Everyone should support him."

After having influence, more and more people adopt the standard of Liu Jinbiao initiative. "Actually, this standard is not what I made, it is JIS.

It took 3 years before and after. "

With the gradual control of the tolerance of parts in Taiwan, the bicycle manufacturing industry in Taiwan is becoming more influential in the global market.

In the process of pferring more orders from bicycle manufacturers to Taiwan, as a new entry of the industry, the giant crossed the "struggling survival" stage and began to enter the fast growing period.

Because of the importance of quality stability and production technology, the company has striving for more and more orders, especially the Schwinn, which has been developed for seventy or eighty years in the US for the first time in the United States. At the same time, by the end of the 70s, the local production capacity was greatly integrated, which made it the industry leader in Taiwan in 1980.

Taiwan's local purchasing power began to grow after manufacturing in 1970s. In 1981, Giant began to try to sell Giant brand in Taiwan.

"At that time, no one did domestic sales. On the other hand, people already had the strength to buy Motorcycles, and bicycles were gradually eliminated.

We believe that these high-end models exported will also have a market in Taiwan.

So we started to do local sales.

It is ideal to do it at the beginning, and there is a word called human being.

Liu Jinbiao said.

In fact, with the continuous expansion of huge manufacturing capacity, even though it has begun to sell its own brand in Taiwan, the realistic pattern is not so ideal or even latent crisis.

The reason is that over 75% of the business revenue is derived from Schwinn's OEM orders. The weight is too large. At that time, 90% of the business was OEM.

Liu Jinbiao believes that there is no permanent customer in the world. "What if Schwinn should cancel the order?"

The only way to deal with it is to further develop the sales of private brand Giant, in order to reduce the "weight" of Schwinn.

However, the huge fear that this action angered Schwinn, so they carefully solicited the Schwinn's opinion, and told the latter that Giant would not sell in the US market, but to Schwinn did not sell the European market.

As expected, Schwinn did not agree.

Subsequently, the giant joint venture "Giant" was put forward.

Schwinn agreed with the proposal, but the conditions were harsh. "Our two companies have set up a company in the United States, and the brand of Giant belongs to the joint venture company. They want to make up 80% of the company's shares and we account for 20%."

In order to reduce the threat of Schwinn on the one hand, because of the urgent need to internationalize Giant's brand, Liu Jinbiao is willing to make the brand internationalization.

"In 1984, in Chicago, the two sides established this bill."

Although Liu Jinbiao always knew that there was no permanent customer, he did not expect that Schwinn would come to the bottom of his hand.

Two months later, he heard in Taiwan that Schwinn went to Shenzhen to investigate and start investing in the establishment of the Chinese bicycle factory.

The news is like a thunder.

"If Schwinn is directly talking to me, I will think that the joint venture can continue to do the brand. The problem is that it dare not tell me (Shenzhen builds factories)."

Liu Jinbiao said.

The huge management team set up a crisis management team to discuss the countermeasures urgently. First of all, the analysis is: how long will it take for the Schwinn factory in Shenzhen to complete all the orders?

"The analysis at that time took about 3 years, because the production capacity and technological level of the Shenzhen plant will not catch up with us for a while."

Just like Foxconn's foundry for all kinds of electronic products, and then form a complex and powerful production network, because of the great improvement and production capacity of the foundry, it has even begun to make some unique development in the application of some materials.

In 1985, it began to study how carbon fiber materials were applied to bicycle production, which was the most advanced at that time.

After the meeting, it began to sell itself to Europe alone.

In 1986, Giant established the Giant Europe sales company in Holland and started its brand internationalization. This is the earliest international attempt of the local brand.

Liu Jinbiao said, "at that time it was risking to turn a blind eye with Schwinn.

Internationalization of the company: first brand, then manufacturing, to enter the European market. Giant has a good time.

That would lead the European market to be a local brand. Schwinn and other American companies are not big.

European bicycle brands are sticking to the rule of consumer demand.

In their view, bicycles were born in Europe and then spread to the United States. In their view, the mountain bike that Americans like is too big, too hippy and lacking European elegance.

"The reason why we can develop quickly in Europe is that the strategy of product differentiation is very important," he said.

"The mountain bike is very popular in the United States," said Xu Lizhong, assistant director and spokesman for the giant group.

At that time, we thought that European consumers also had the need for recreational sports in the wild, and the performance of mountain bikes could help them better, so there must be some demand. "

The high-end mountain bike with $500 or more has become the key to Giant's opening to the European market.

At that time, manufacturing in Taiwan also meant "cheap". Therefore, Giant's sales in Europe should be promoted in the image of European companies.

In addition to the above two reasons, Xu Lizhong believes that localization strategy and sports marketing are equally important.

After the establishment of Holland company in 1986, the company set up a sales company in Germany, England and France, and set up an American sales company, BILL AUSTIN, in 1987.

"At that time, we did not understand the talents of international operations, we could only choose talents localization.

This proved to be quite correct. "

Giant Leo Schoonas and Bill Austin, which are responsible for the European and US markets, are experienced people with bicycle sales experience, including Bill Austin working in Schwinn America.

They criticize the quality of Giant's original brand bicycles.

To this end, a huge production line called IA (industrial art) has been set up to supply European market demand.

The product of this line is to make products as an industrial art.

In addition, Leo Schoonas's access strategy in Europe, Giant's recognition of the European market, has since greatly extended the IA line to other production lines.

Subsequently, the huge establishment of Japan, Australia and Canada Company continued in 1989 and 1991.

After developing relatively stable sales in the European and US markets, Giant began sponsoring local convoys and embarking on the "sports marketing" approach commonly adopted by industry Brand Company.

With the continuous upgrading of Giant sponsorship competition, in 1997, Giant sponsored the Spanish team of the top three teams in the tour de France, and Giant became the world's top bicycle brand.

In fact, before 2000, Giant did not make any difference in marketing.