Red Dragonfly: Speed Is Differentiation.

This is a rapidly changing era: customers' needs are constantly changing, they pursue individuality, and prefer products with short life cycle and fast updating.

In the book "time rivalry", Regis McKenna referred to customers in the new era as "never satisfied" customers.

Not only do they have more demands, they are also more likely to change their minds, and their progress in life and the increase in their choice opportunities make them less and less satisfied.

To cope with this change, the only strategy for enterprises is to react quickly.

For this reason, American economist Alfred Chandler put forward the concept of "speed economy", which means "bring the economy of excess profits to meet the various needs of customers quickly".

The shoemaking industry of Red Dragonfly belongs to the daily consumer goods industry. The whole industry is in a mature stage, with low concentration and fierce competition, and customer demand is changing rapidly.

For us, speed is satisfaction, speed is differentiation.

Around the main line of order implementation, the Red Dragonfly realized the rapid response of the whole supply chain by continuously improving the speed of every link in the supply chain.

Speed is satisfaction, speed is the importance of differentiation to speed and market competition. People will think of the new economy represented by the IT industry. John Campos, President of CISCO systems, the world's largest network data pmission company, said that in the new economy, "not big fish eat small fish, but fast fish eat slow fish".

A popular saying in Silicon Valley is "speed is God, time is ghost".

In fact, for the traditional industry of fashion consumer goods industry, the speed is also important.

Taking the clothing industry as an example, the general domestic clothing enterprises selling more than 700 million yuan will form a serious inventory backlog and depreciation, leading to small profits or losses.

The Spanish clothing brand ZARA created a miracle of the apparel industry with speed. In 2003, ZARA sales amounted to 4 billion 600 million euros, and its profit was 460 million euros; in 2003~2005 years, ZARA sales and net profit grew by more than 20%, which is in sharp contrast to similar enterprises.

The pursuit of system optimization and supply chain "overall throughput" enables ZARA to achieve double growth in scale and profit.

The goal of ZARA is to complete the product in 15 days from design, purchase, production to the sale of stores on the global stores (the domestic garment enterprises usually have more than 30 days'), distribute to most stores in Europe within 24 hours, arrive in the United States 48 hours, arrive in Shanghai and Japan 72 hours.

Compared with the same industry in China, red dragonflies pay more attention to speed: "speed is satisfaction, speed is differentiation".

Why does speed mean satisfaction?

We usually require products to be guaranteed time, quality and quantity to reach the client, and the time and quantity are all about speed.

If the order signed with the customer is not completed on schedule, the customer will not be satisfied. This dissatisfaction is caused by speed, so there is no satisfaction without speed.

Why is speed differential?

In terms of the design of shoes, if we go directly to the European fairs to absorb fashion elements, we can say that it is innovation; but if we come from the Chinese market, we can only say that it is imitation.

Innovation is differentiated, and innovation needs to be fast, so speed is also differentiated.

Integrating external resources to create a fast and smooth supply chain, Adam Smith's "division of labor theory" and Marshall's "economies of scale theory" deeply affect generations of entrepreneurs; however, today's market economy has undergone tremendous changes compared with 100 years ago: enterprises continue to expand, competition continues to escalate, supply exceeds the market capacity rapidly, and a large number of inventory backlogs, devaluation and other "scale economy" phenomenon.

How can we prevent "scale economy" from happening?

Red Dragonfly regards customer orders as the main line of satisfaction, and on the basis of strengthening its own core competence construction, pays attention to external resource integration, successfully implements outsourcing strategy, and creates fast supply chain to achieve continuous growth of scale. In R & D, it takes the advantages of independent research and outsourcing as the research and development mode, so as to give full play to its advantages of "initiative, quick feedback and high innovation".

In 2001, the Red Dragonfly development center was set up. In 2004, the research center of the red dragonfly was established by the United Research Institute of leather and footwear industry, Shaanxi University of Science and Technology and Italy LARIO. At the beginning of 2006, a shoe technology laboratory was set up, which invested in the acquisition of various advanced testing and testing instruments and scientific research equipment, and hired well-known experts and professors at home and abroad as technical advisers.

The company's product development center and Technology Lab have more than 50 designers and 10 consultants.

The research center has applied for 14 patent technologies successively, and has successfully developed a series of innovative products such as functional shoes, antibacterial and deodorant shoes.

Abroad, red dragonfly has also set up a research and development branch to acquire the latest international popular colors, raw and auxiliary materials, fashion elements and other information at the first time, integrate these information into product design, quickly launch innovative products, and cultivate the core competence of enterprise innovation.

In June 2007, red dragonfly first extended the Chinese leather shoes industry cooperation overseas, and formally engaged in scientific and technological cooperation with the Ace sports company, a Belgian sports shoes R & D company, and jointly developed sports leather shoes.

The launch of sports leather shoes is a homer in the process of Red Dragonfly technology and fashion. In the future, red dragonfly research and development will focus on the concept of technology and fashion, create a higher grade, more high-tech content, and more fashionable Red Dragonfly shoes, and add fresh elements to the Red Dragonfly brand.

"Outsourcing development" means that the cooperation between red dragonfly and finished product suppliers is directly aided by the design of the supplier. Its advantages are flexible and wide information.

With the increasing individualization of customer demand, the market is calling for more product styles. Independent research and development should ensure that technology and fashion are in the lead. It will focus more on R & D core competence construction. It can not be applied in every aspect. Outsourcing research and development can make up for the lack of independent research and development, get enough advance information, and launch enough new products.

At present, in the thousands of new products launched by the Red Dragonfly every year, outsourced development accounts for more than 1/3.

In terms of manufacturing, the production mode of combining autonomy with outsourcing has been built in Wenzhou, Guangzhou, Shanghai and Chongqing as the core production. In the Guangzhou, Wenzhou, Jinjiang and Chengdu, the product procurement base has been set up, that is, outsourcing production.

Independent production, focusing on mass production and independent research and development, is the core competence of the enterprise production chain; outsourcing production is engaged in individualized and small batch production, and has complementary advantages with independent production.

Outsourcing production can effectively reduce the "operation cost" and "opportunity cost" of independent production.

Because the footwear industry is seasonal fashion consumer goods, the value of products will decrease rapidly over time.

If all production is done autonomously, the production cycle of large quantities of products will be prolonged, resulting in an increase in "operation cost" and "opportunity cost". Meanwhile, some small batch products will be abandoned, resulting in a "rising opportunity cost".

For example, if a product with a price of 300 yuan / double has been delayed for half a month, its own "activity cost" will increase by about 2 yuan (storage and financial cost), while the market price of these shoes will be reduced, and it may become 200 yuan or not sold, so that the opportunity will become more than 100 yuan.

In addition, due to the abandonment of the production of some small quantities of products, the company has to pay extra market "opportunity cost", which costs more than 100 yuan.

The red dragonfly has established long-term strategic cooperative relationship with suppliers through integrating supplier resources. On the one hand, it has maintained their long-term performance, and on the other hand, it has provided reliable guarantee for the "time keeping, quality and quantity guarantee" of our products.

In the sales channel, self marketing and self agency combined sales mode is adopted. The self-service store has a fast response to consumers and is easy to handle inventory quickly. Similarly, the large investment needed by self operated stores will reduce the speed of expansion, and then lose good market opportunities, resulting in the rise of "opportunity cost".

In order to give full play to the role of self run store in "radiation drive, control channel, demonstration education and training team", and reduce the cost of input, red dragonfly pioneered the green grass plan in 1998, and implemented the chain Monopoly project combining self operation and agency. So far, it has developed to more than 4000 monopoly terminals, including more than 600 self operated stores.

The sales mode combined with self agency and agent appears to be simple and difficult to operate. The agent management is especially difficult.

Red Dragonfly began to implement the "sunshine project" in 2000 to maintain and enhance the market's terminal image.

In 2004, the "blue sky system" was introduced to focus on resource development. The five upgrading systems (upgrading of ideas, upgrading of teams, upgrading of organizations, upgrading of channels and upgrading of capabilities) were launched. The speed and efficiency were put on the agenda, emphasizing that speed is differentiation, refinement, and no expansion.

Red Dragonfly striving to improve the management capacity of agents, continuously commitment and give agents high quality products, excellent services and fair prices; in order to strengthen the management of agents, red dragonfly uses the "four forces" (cohesion, business strength, business capacity, store force) model as the comprehensive evaluation standard of agents.

Through continuous help and support from agents, red dragonfly finally realized the benefit sharing with agents, and established a win-win relationship between long-term and mutual trust.

As mentioned above, red dragonfly has implemented the strategy of independent innovation combined with outsourcing in three aspects of R & D, manufacturing and sales. Through the stripping of non core businesses, it has concentrated the limited resources and energy on the construction of the core competence of enterprises, and greatly improved the speed. At the same time, outsourcing simplifies management affairs, frees enterprises from complicated daily affairs and focuses on the cultivation of core competence.

Information construction is the four key strategy to speed up the response speed of supply chain to ensure fast and smooth flow of information, shorten supply chain business links, beat orders, optimize logistics and supply chain information support.

The four key strategy is a whole, which is indispensable. Information technology plays an important role in every stage. The continuous development of various links in R & D, manufacturing and sales channels is inseparable from the support of information technology.

In 2000, red dragonfly carried out a distribution system in collaboration with a scientific research institution in a university, supporting the Red Dragonfly for more than 5 years, and made great contributions to the company's business upgrading.

5 years of development have constantly raised new demands for the IT system. The distribution system has become increasingly strenuous in its business and can not support the future development of the red dragonfly.

To this end, red dragonfly joined hands with AMT in 2005 and launched the IT planning consultation project.

This project not only provides a blueprint for the IT construction for the red dragonfly in the next 3 years, but also analyzes the Red Dragonfly's "Pyramid" business mode and process diagnosis, and puts forward the management idea of Red Dragonfly's "product season operation main line".

The product season is a business cycle in which all sales and marketing centers are operated.

The main object of product season management is product orders, and the main executors are marketing, R & D, and supply departments on the supply chain.

Combined with the business characteristics, the Red Dragonfly product season operation is divided into six stages: demand analysis, product development, review order, product organization, sales promotion and summary assessment.

2 in the demand analysis phase, the marketing department determines the product demand plan for each product season under the guidance of the annual product requirement outline through analyzing the internal and external information, so as to provide reference for the R & D department to plan the quarterly product development plan.

2 product development stage R & D