Chang Xiang Network: Travel Revolution

A few days ago,

IT concept companies are often seen in VC ventures, but Chang Hsiang net's high-profile appearance is stunning.

An inspiration for fake invoices

Previously, Lin Dong was aware of the industry because in August 2005 his Lusheng group and the Internet company worked together to create a new marketing mode of "reality + virtual": the characters in the online games "add energy" by buying virtual green food, while in reality, the packaging and advertising of Lvsheng food are advertised on online games.

Subsequently, the co generation network based on this model was born and subsequently won the venture capital injection.

Chang Xiang network, which was born after the joint network, came from Lin Dong's consideration of a fake invoice.

In 2004, the manager of Lusheng branch bought over 1200 yuan of wigs tickets to Beijing to reimburse the company for travel expenses, and the company was fined 2340 yuan after the incident.

There are dozens of offices in the country. How can we avoid such things? As the chairman of Lusheng group, Lin Dong began to think about this problem.

If there is a new technology specifically designed to manage travel expenses for businesses, how big is the market for so many enterprises across the country?

How to excavate this big market, Lin Dong has been thinking for two years.

In October 2006, after losing the joint network to partner Guo Yu, Lin began to devote himself to the establishment of Chang Xiang network.

In July 2007, Chang Xiang network was officially operated.

From the beginning, Lin Dong gave clear positioning to Chang Xiang network's operation mode: providing 24 hours of air tickets and hotel services for enterprises, and providing travel management and interest free travel credit services for enterprises.

Unlike the traditional ticket generation business, the innovation of the Chang Xiang network lies in the bottlenecks of payment and procurement, which makes the traveler no longer directly contact with cash and invoices, thus realizing the pparent management of travel expenses.

The traditional mode of travel management is too cumbersome. Starting from the cost advance report to the final financial reimbursement and so on, it takes an average of 30 days to complete a process.

Chang Xiang net simplifies the process: employees travel without cash, and directly login to Chang Xiang to book tickets and hotels.

The contract companies can set up the travel level of their employees in the Cheung Hsiang net -- economy class or first class, five star hotel or 200 yuan Economy Inn Airport.

When things are done, the traveler just signs at the front desk.

At the end of the month, Cheung Cheung network and the unified settlement fees of enterprises, and provide all invoices at once.

Chang Xiang also introduced the banking system in business mode.

In order to provide services for customers, Chang Xiang network does not need to pay any fees.

Lin said this is the core part of Chang Xiang net's business model: "we have solved the cash flow problem of enterprises."

Chang Xiang is the only travel service company in the world that brings the banking system into business mode, which is what Ctrip and e long wanted to do but failed to do.

The two B2C travel service providers also hope to make a difference in the B2B travel service market, but the huge demand for funds has limited their development space.

The involvement of banks makes the biggest difference between Chang Xiang and Ctrip in the form of payment: Chang Xiang carries out the platform payment, while Ctrip pays the bill directly.

Because of the pparent information management system and the outsourcing of business trips to Chang Xiang, the cost of employee travel is only an autographed signature. The final settlement is between Chang Xiang and enterprises, thus blocking potential financial loopholes.

In addition to the more pparent travel costs, Chang Xiang can also help customers save travel costs.

"Now we have signed thousands of hotels, and the cost of group purchasing is very low. Some high star hotels can get a 400-800 yuan price tag lower than the market price, and giving most of the profits to customers will obviously save their travel costs."

Lin Dong said.

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The next Alibaba?

"There is a lot of space in the travel market, and even the listed Ctrip accounts for only 3% of the market share.

And from the perspective of enterprises, Chang Xiang network calculates that the average annual travel cost of each enterprise is calculated by 300 thousand yuan, so that 100 000 enterprises will have a three hundred billion yuan market.

Lin said the market is "very tempting".

According to official data, the market that Lin Dong is optimistic about is indeed a coveted allure: the National Tourism Administration survey shows that China's annual expenditure on domestic business travel amounted to 170 billion US dollars, accounting for 30.5% of the domestic tourism market and increased by 20% annually.

Chang Xiang plans to sign 100 thousand customers by the end of next year. "Every customer has a 200 thousand annual travel cost, and the platform's cash flow is 20 billion. The gross profit margin is 8% now. If you sell beef jerky, I don't know how many years to do it!" Lusheng group made Lin Dong become a multimillionaire at the age of 34, but he now prefers others to call him the founder of Chang Xiang network.

His goal is to achieve IPO in two years and create the first network of global travel management.

So far, Chang Xiang has signed a contract with more than 5000 customers, and the monthly turnover has exceeded 10 million yuan.

Lin said that at the end of this year, Chang Xiang will have 100 customers who spend more than 20 million yuan on travel expenses and 1000 customers who have more than 2 million travel expenses over the year. According to this year's target, the travel expenses of the company's customers will reach 6 billion yuan, and gross profit will reach nearly 500 million yuan.

In the first phase of this year, Forbes, a world-renowned business magazine, has reported Lin Dong and his Chang Xiang network in three editions. The report says that Chang Xiang has changed the mode of Chinese travel management and is promoting a travel revolution.

Coincidentally, the magazine reported seven years ago to another enterprise in Hangzhou, and predicted that the company will develop rapidly, which is Alibaba.

Jane Lee, who wrote the report, said: "obviously, I think the next Alibaba will be Chang Xiang."

However, it is too early to conclude that Lin can become a Travel Management MA.