The Leap Of Flying High Was Suddenly Injured.
Over the years, the low price competition strategy has resulted in no increase in profits, so that it has borne a heavy financial burden on itself and exposed itself to changes in the macro environment.
It seems that the leap that has been soaring has suddenly been "injured".
In 2008, while the operating performance dropped sharply in the same period last year, there were serious problems in the gold chain.
It is understood that due to the rapid development of assets and the deterioration of profitability in recent years, the company is in a state of tight funds, and its asset liability ratio remains high.
A local financial personage revealed that at the beginning of the year, joint-stock banks no longer renew loans after the maturity of their loans, and Qiu Jibao, who was a responsible man, was forced to turn to usury to enrich liquidity and aggravate the financial strain.
But what is the reason why benchmarking enterprises in this industry are in trouble?
Overseas exports were blocked in 1994, which is a key year.
Qiu Jibao, a shoe maker, also set up his flying sewing machine group company.
In fact, Qiu Jibao's experience is much more difficult than Cai Kaijian's.
In 1982, Qiu Jibao spent 300 yuan on his savings and started the Jiaojiang water Dou electrical instrument factory.
Prior to that, he spent three years in leather shoes in the northeast and worked in the sewing machine parts factory near Jiaojiang for over a year.
In order to produce spray parts, Qiu Jibao invited the master from Shanghai, and sped out his new house, and he played the floor with his new wife. He left the well water to the master and used to fetch water from the river.
4 years later, the small workshop that had begun to take shape was established. Qiu Jibao also had new ideas for his future.
This year, the predecessor of the leap - Jiaojiang second industrial sewing machine factory was established.
The choice of sewing machine industry is because the local sewing machine industry has begun to take shape.
It was against this background that Qiu Jibao began his sewing machine journey.
Following the way of the first local sewing machine factory, the first industrial sewing machine factory in Jiaojiang, he placed the hope of obtaining orders at the Canton Fair, but orders were hard won.
Qiu Jibao once told this history more than once on various occasions: with enthusiastic enthusiasm, he returned to the Canton Fair where foreign businessmen gathered on his own machine.
Because he was an individual operator and came from an unknown small factory, he was unpolitely denied.
Anxiously, Qiu Jibao turned around the hall for several circles, and finally found a sewer leading to the wall. He went in without hesitation, and was caught by security guards. Not only was he fined 50 yuan, but he was also punished for standing for half an hour.
He vowed that he would have a place in the Canton Fair in the future.
Later, he found a faithful Hongkong man at Shenzhen Luohu port and asked him to buy a Hongkong telephone directory.
With this telephone book, Qiu Jibao found all the shops that run sewing machines in Hongkong, sent samples and photos one by one, and finally received the first order of thousands of dollars from Hongkong.
When the flying sewing machine group was founded, Qiu Jibao even had an overseas branch company, which was set up by the Hongkong branch in 1992. This is the first time that the sales network of the branch system was established by leaps and bounds.
However, in 1994, when the financial crisis broke out in Mexico and spread to Brazil in South America for a while, the government of Brazil adjusted the domestic economic policy urgently, including adjusting foreign exchange, reducing the deficit and increasing the import tax on some industrial products.
South America is Qiu Jibao's main focus on expanding exports overseas.
After the storm, Qiu Jibao was forced to cast his sights on the Southeast Asian market.
In the same period, ZOJE's Cai Kaijian had different reflections. In addition to the blind plan of 60 thousand exports a year, he also found two details. First, the export customers' money was not timely enough. Two, the domestic sewing machine had a higher rate of return.
As a result, Cai Kaijian turned his attention to China.
In 1998, leap also set up an American branch in Miami.
In fact, the overseas economic situation was not optimistic. If the Federal Reserve did not save the debt, Russia's failure to pay its debts would trigger the collapse of the long-term capital group of the United States, which could trigger a worldwide economic crisis.
In the year when the Asian financial crisis was most serious, China announced that the renminbi would not depreciate. The only good news was that the export rebate rate of the domestic sewing machine industry was once again restored to 17%.
In fact, despite the twists and turns in overseas markets, Qiu Jibao did not give up the expansion.
In March 1997, the two area of the leap Group of 150 thousand square meters of construction area was fully completed and put into operation.
In May, the merger of the first old industrial sewing machine factory in Zhejiang under the old factory of Xia Chen was established.
In July 1998, the company bought the Hangzhou DuPont sewing machine company and built the largest production base of sewing machine in China.
In the same period, Qiu Jibao was widely publicized and gained all kinds of glory because of his pioneering experience and large-scale overseas expansion in his early years.
The leap has become the object of visits by state leaders, foreign dignitaries and delegations from all over the country, and has become a banner of Taizhou sewing machine enterprises.
In 2001, Qiu Jibao won the 54 Medal of Chinese youth. In 2002, he became the first private entrepreneur to be elected as the representative of the sixteen National Congress of the National Party Congress. After a year, he was awarded the title of "master of management in Zhejiang".
For a time, Qiu Jibao's fame reached its peak.
At the same time, Qiu Jibao went farther and farther in the pursuit of scale.
Later, data showed that in 2001, Qiu Jibao decided to build an industrial city with an area of nearly 2 hectares (3000 mu) in the intersection of Airport Road and hung San Road in the lower Chen Street (formerly the lower Chen town).
This plan involves the demolition and resettlement of more than 2000 villagers in 5 villages.
In the plan at that time, the first block, the leap electromechanical integration Industrial Park (the first phase of the leap industrial city), covers an area of 545 mu, mainly building a leap office building, a scientific research park and a standard workshop.
Block two, that is, leap area, with an area of 300 mu, is a business oriented residential district for resettlement of villagers involved.
Block three, that is, the leap garden, at that time, he said, "requisition 460 acres of land on the eastern side of block two for real estate development, so as to make up for land acquisition expenses, demolition compensation, and villager resettlement point construction and other funds, so as to realize zero investment in government construction and leap industrial city".
At the same time, Qiu Jibao also tried to make a breakthrough in technology.
In addition to acquiring a small factory in Japan, employing sewing machine experts and scientific research personnel in Germany, Italy, Japan and other countries, leaps and bounds also borrowed heavily to make technological pformation, and introduced hundreds of sets of advanced processing equipment from the United States, South Korea and China to Taiwan.
In 1999, the "leap" mechatronics multifunctional household sewing machine entered the Japanese market for the first time, ending the history of Japanese sewing machines one-way export to China.
Subsequently, Qiu Jibao announced the company's grand plan: to the end of 11th Five-Year, that is to say, in 2010, it achieved sales value of 27 billion yuan, total import and export volume of 1 billion 500 million dollars, profits and taxes 1 billion 500 million yuan.
What is the concept of 27 billion yuan?
According to the statistics of the industry association, the total output value of the sewing machine market in China was about 50 billion in 2010, that is to say, it would take up half of the whole industry by leaps and bounds. In fact, the market share of 600302.SH, which was recognized by the industry and had many years of production history, was only 6%-7%.
The change of macro economic environment with low profit margins has become the fuse to trigger a leap in crisis.
The economic policy that led to the comprehensive pformation of China's economy began in 2004 to make Qiu Jibao's pressure rise sharply.
According to his own theory, at least 60% of the products are home appliances, and the competition of home appliances has reached the level of white hot. This can be seen from 002196.SZ, a listed company that produces household sewing machines.
According to the disclosure of Founder's prospectus in 2007, the profit margin of the company's products is only 1% - or even far below the one-year deposit interest rate of 4%.
The so-called operating profit rate refers to the profit rate minus the production cost, the period cost and the value added tax (after tax rebate).
When the reporter consulted the matter, Zhang Zeyu, the company's deputy director, explained that the reason why the profits were so low was due to the pressure from a local customer, and the accessories of the company were mainly leaps and bounds.
Qiu Jibao once revealed that innovation has significantly improved the profit space of "leap" products.
During the "85" period, the average price of each sewing machine was 500 yuan, and the price of each sewing machine had risen to 2500 yuan by the end of "95". At the end of the fifteen year, this figure has leaped to ten thousand yuan.
Mechatronics sewing equipment production accounted for only 10% of the total output, sales accounted for 50%, profits and taxes accounted for 90%.
But in hindsight, the effect of this technological effort is not obvious.
Part of it is facing huge competition, as competitors are also moving toward the middle and high end. In fact, there are few enterprises attempting to innovate independently like leap. Fierce competition makes the effect of leaps and bounds not appear. The latest data show that the gross profit margin of the leap product is only 29%.
In addition, according to the 2007 annual report of ZOJE shares, the net interest rate of the company is about 10%.
From this, we can roughly outline the financial situation of the leap sewing machine industry: data from Taizhou Customs show that from 2005 to 2007, the total export value of leaps and bounds was 75 million 470 thousand yuan, 86 million 150 thousand yuan and 90 million 630 thousand yuan respectively, up 17.1%, 14.1% and 5.2% respectively.
On the Leapfrog Group website, the leap provides a set of data about its production and marketing situation, with 1 million 800 thousand household machines and 700 thousand industrial machines, of which 60% are exported.
In fact, Qiu Jibao himself claimed that the data on the leap in production and sales were also unpredictable to his peers.
In the September 2007 issue of ZOJE shares, it quoted the market share of the major industrial sewing machines in the previous year.
According to the sales volume of 700 thousand of the industrial machines provided by the leap, it is roughly the same as that of ZOJE, which should account for more than 5% of the industry.
The data are based on the data of the China Sewing Machinery Association and the statistics from the research department of China International Finance Corporation.
Then, is the data provided on the fly website ideal target data or real data?
Colleagues were skeptical.
According to the market situation, the proportion of domestic sales jumped by no more than 20%.
Even according to the leap of his own statement, the domestic and international market is 46 open. Then, based on the data of Taizhou customs, the revenue of leaping three years is basically maintained at 1 billion yuan -11 billion yuan.
With an average of 6% net interest rate, the profit in recent three years is no more than 60 million yuan.
High financial costs, if such a judgment is true, then leap profits will not meet the cost of operation.
In the first phase of the leap industrial city, we need to pay 100 thousand yuan of land per mu and 60 million yuan per square metre for the first phase of the industrial city. The total cost of building 5000 yuan per square metre is 150 million yuan.
From an accounting point of view, the annual depreciation cost of leap is also much higher than that of ZOJE. According to ZOJE's earnings report, its annual depreciation cost is about 20 million yuan, which is mainly on the ground floor. Only a leap of land will cost more than ZOJE's cost of nearly 60 million yuan.
What's more, the leap is to expand this kind of loan.
Increasing revenue does not increase profits. The leap has used many years of low price strategy, which has brought heavy financial burden to itself, and exposed in the circumstances of macro environmental changes.
And that's not all.
According to a person familiar with the matter, Qiu Jibao spoke of the company's business situation at a recent high-level meeting of the group.
Qiu Jibao told his subordinates that a group of goods had just arrived in South America, and then they dropped the goods down to the sea, because it was better to deal with it immediately than to sell slowly after landing, "the cost of warehousing is far more than the proceeds," the person familiar with the matter said.
This also means that there are problems in the two links of inventory turnover and accounts receivable - turnover rate is the key to low price strategy.
In fact, in addition to facing the high cost of the industry, inventory turnover and problems of accounts receivable, the leap also needs to bear additional financial costs.
At present, there are two versions of the leap in debt. The first is that the total liabilities of the leap are conservatively estimated at about 3000000000 Yuan, of which the bank loans amount to about 1 billion 600 million yuan; the other is that by the end of May this year, the balance of the bank loans of the leap Group is 890 million yuan.
Even later
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