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Is It Urgent For Jingdong To List In The US?

2014/3/18 23:16:00 115

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capital shortage, high cost, rapid growth and collapse.

All along, the company a href= "http://www.91se91.com" > Jingdong < /a > is in various rumors.

Finally, as it applied for listing, various data about the company were also publicly disclosed.

On the night of P January 30, 2014, on the eve of Chinese Lunar New Year, the Jingdong submitted a prospectus to the US Securities and Exchange Commission (SEC), announcing that the financing would not exceed $1 billion 500 million, and also released the three year financial data of the company.

choosing this kind of time point is usually to avoid too much media coverage, but on the evening of that day, the staff of Jingdong public relations department have been answering the media enquiry telephone.

although in December 2013, Liu Qiangdong, who returned from Harvard University, is still emphasizing that Jingdong will not be listed before 2015, but Zhang Jing, an analyst at the consulting firm, told reporters that the industry expects Jingdong to go public in 2013. When they heard rumors about Jingdong city in December last year, they felt very reliable. Before and after that, Jingdong bought a research report on the electricity supplier industry to ARI, and the data on the market share of China's electricity supplier industry was finally put into the prospectus.

an employee who joined the Jingdong earlier told reporters that Jingdong has always had a listing plan, and is also in contact with investment banks. It is just looking for the right time.

Prior to the review of Jingdong's listing, P got a briefing from the investment bank which was alleged to have been hired by Jingdong in March 2012. At that time, the sale of Jingdong in 2011, the gross profit margin as low as 5.5% and the loss amounting to about 1 billion 200 million yuan were announced in this briefing, which is roughly consistent with the data released in the IPO.

"can this business mode work?" an electric business executive told reporters that he looked at the prospectus of Jingdong, hoping to answer the puzzle by the data released by Jingdong. Although in the first three quarters of 2013, Jingdong still lost more than 300 million yuan in its main business, but the key is to look at the trend.

Generally speaking, one is to see the convergence of cost, the two is to see the growth of gross profit margin of main business.

Liu Qiangdong and Jingdong employees have the habit of "user experience" and think that this is the engine of Jingdong growth.

The most important part of the engine is the logistics and distribution service of Jingdong.

Today, Jingdong logistics has both speed and scale advantages. Jingdong can reach 28 cities in the next day and 206 cities in the next day, with more than 200 million orders and 49 billion 200 million yuan sales in the first three quarters of 2013.

But this service has huge manpower investment and the cost of storage center construction is not expensive. It makes people worry about whether Jingdong has paid too high cost and cost for this service.

the most brilliant achievement of Jingdong in 2013 is that the implementation cost (Fulfillment) of < a href= "http://www.91se91.com/news/index_s.asp" > order < /a > is substantially reduced from the prospectus, which is approximately equal to the commonly known warehouse logistics cost.

From 2009 to 2012, the logistics cost rate of Jingdong was 4.9%, 5.6%, 7.2% and 7.4% in the first three quarters of 2013.

This data is excellent even compared with Amazon: Amazon has a cost rate of 11.9%.

comparing warehouses in some parts of China between Jingdong and Amazon, although the warehouse of Jingdong is somewhat crude and not neat, but its cost is lower, and it can also deal with the rapidly growing orders of the company. The order quantity of the supplier is the largest in China, and there are more than 200 million orders in the first three quarters of 2013. In the key link, there is also a full automatic parcel distribution line.

In 2013 P, the logistics IT system of the Jingdong has been reformed, and it can more smoothly go out of the warehouse containing orders for many commodities. Before that, it was more accustomed to processing orders for single SKU. In the first three quarters of 2013, the number of SKU per order in Jingdong was more than 3 times that of 2012, and the unit price increased by 18 yuan, but the delivery cost of each order decreased by 2 yuan.

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however, as Jingdong's warehouse in Beijing was leased two years ago, it has changed from a surplus to a full load, and Jingdong has eaten many of the previous two years in logistics in 2013.

In terms of logistics costs, in 2010, 2011 and 2012, the funds invested by Jingdong were 2.3 times, 2.17 times and 1.02 times of that of the previous year respectively, while in the first three quarters of 2013 compared with the first three quarters of 2012, the growth rate of Jingdong's input in logistics costs was only 30.9%, far below its 70% income growth rate.

but it is foreseeable that Jingdong's investment in logistics will also increase in the future.

Liu Qiangdong holds nearly 24% of Jingdong's shares before IPO, but those are 1 shares of class 20 shares with 20 times voting rights. The absolute control of the founder on the company will enable Jingdong to extend its previous large-scale logistics investment plan, including the construction of 8 "Asian 1" large warehousing logistics centers, with only 3 currently under construction.

because large storage centers have room for future development, this means that they will have plenty of vacant resources at the initial stage of construction. Jingdong's order fulfillment costs will rise again, but in the long run, this should mean efficiency improvement and cost reduction.

2013, Jingdong's strategy is to recuperate.

The company, which has been expanding rapidly over the past few years, has made internal adjustments and improved efficiency.

In the first three quarters of 2013, Jingdong's administrative overhead rate was 1.03%, compared with 1.5% in the previous two years.

This also means that with the increase of Jingdong sales, administrative expenses can be reasonably diluted.

for similar reasons, although the Jingdong seems to have made many advertisements in 2013, including higher price TV ads and outdoor public pport subway advertisements, the cost rate has not increased significantly.

From 2009 to 2012, the cost of Jingdong market was 1.5%, 2.3%, 2.3% and 2.7% respectively, and the proportion dropped to 2.2% in the first three quarters of 2013.

In addition, the R & D technology investment rate of Jingdong has basically remained unchanged.

, which also reduced the cost of Jingdong to 10.4% in the first three quarters of 2013.

From 2009 to 2012, the cost of Jingdong increased from 8.32% to 13.13%.

besides controlling costs, the company, which has long been paying attention to "paying money" and "losing money", is another key to raise gross margin.

one of the ways to achieve profit growth in retail industry is to expand the scale, obtain lower purchase prices from suppliers, and promote the benefits of publicity and longer accounts.

In 2009, Liu Qiangdong once said that Jingdong could break even when its sales volume reached 4 billion yuan; in 2011, he also predicted that Jingdong could make profits in the second half of 2012.

But this is not the case.

The above electricity supplier executives said that although the overall sales volume of Jingdong is huge, but the sale to a single brand of different brands, the sales volume of Jingdong and even the electricity supplier channel in a large number of brand businesses is still "small, the resources that can be obtained, the price range is still low".

but the special feature of Jingdong is that although the price competitiveness of Jingdong is relatively low, it has little impact on sales volume. "According to the above electricity supplier executives, according to his observation, 100 yuan, especially department stores, is worth several yuan more than other electricity suppliers. Consumers usually do not feel or care about it." Jingdong's brand still has a premium capability for consumers.

Because trust Jingdong's genuine guarantee and fast delivery, consumers will be willing to pay a little more money.

The growing influence of brand is good news for Jingdong.

According to Jingdong's prospectus, the gross profit margin of Jingdong rose to 8.42% in 2012, 3 percentage points higher than that in 2011, and 1.7 percentage points in the first three quarters of 2013, reaching 9.76% in 2011.

In 2012, there was a hearsay of Jingdong's intention to go public on 2012.

At the end of 2011, Taobao reported that Jingdong, known for its low profile competitors, was secretly raising the price.

A mobile phone manufacturer told reporters that Jingdong had previously sold a mobile phone with a price of up to twenty yuan or so, which surprised him, because the rate of increase in traditional channels could reach as high as 30%. But in 2013, Jingdong raised the requirement of increasing gross profit for the acquisition system, so that the price range of mobile phones increased to eighty yuan.

, however, according to the data provided by NetEase Hui Hui, in the main domestic comprehensive electricity providers, the proportion of the lowest price commodities of Jingdong accounts for the whole commodity in the first quarter to the third quarter of 2013, basically unchanged. Amazon has risen slightly, and Dangdang, Suning and Yi Xun have reduced to a certain proportion.

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because there is always a ceiling for the price increase, especially in the electronic products and other standard products with strong consumer habits, especially in the case of Tmall, Suning, Yi Xun, shop No. 1 and Amazon.

The gross margin of Jingdong is not high, which is closely related to its high proportion of proprietary electronic products. From 2011 to 2013, its sales of electronic products accounted for 87%, 82% and 82% respectively.

Amazon accounts for more than 6 of the department stores.

however, regardless of intuition or Jingdong's orders, Jingdong's department store business has made significant progress despite its sales.

The company started its entire category expansion in 2010, multiplied its order volume and SKU per order, and sold 4.8 times its volume in 2012, compared with about 3.6 times in the first three quarters of 2013.

This is far higher than its sales growth rate, which means that consumers have the habit of buying lower priced department stores from Jingdong.

Amazon, or Alibaba with high profit margins, their successful experience proves that if we want to increase profit margins, we still have to rely on the third party platform.

In 2011, Jingdong's platform trading volume accounted for only 8.9%, and increased to 22.6% in 2012, but there was little growth in 2013, and only 23.3% in the first three quarters.

"the proportion of their open platforms is lower than we expected." the electricity supplier executives said that the Jingdong had opened up the platform to pursue the speed and settled many businesses, and did not require the third party merchants to enter the warehouse of Jingdong and distribute their products. The experience could not be separated from Tmall.

During the double 11 period in 2013, Jingdong began to encourage third party businesses to use Jingdong's logistics services.

In January 2014, Jingdong executives responsible for the opening platform, Ying Ying Chun, said that "a target=" _blank "href=" http://www.91se91.com/ "> clothing < /a" is one of the most important categories, and the proportion of commissions increased from 5% to 8%.

however, even if the efficiency of the future can be improved and the gross profit can be improved, the main business of Jingdong will also be profitable, but the retail industry has always had a low net profit margin.

If you want to earn more money and get the high value of Amazon, you need to see what imagination the Jingdong has.

cloud service, application < a href= "http://www.91se91.com/news/index_s.asp" > shop < /a >, electronic consumer products, efficient logistics system, these are not only the main source of income and profit for Amazon, but more importantly, these more technical threshold businesses can make investors believe the future potential of the company.

Jingdong seems to be lacking in this respect.

Because of the layout of warehouses and logistics in China before, Jingdong seems to have good prospects for providing logistics services to third party businesses, especially when its large storage center has just been built, and the idle storage space and pport capacity can be exploited and utilized.

Moreover, if the profit is large enough, it is possible to set up an independent express logistics company.

but at present, Jingdong has made little progress in providing cloud services and technology services. It has not been able to launch Kindle products like Amazon, and its e-book publishing business is still very quiet.

Jingdong's most valuable and quick value-added business is its financial services.

In 2013, Internet finance was listed as one of its "four carriages" by Liu Qiangdong, which is parallel to logistics, technology and electricity supplier.

With the increase of Jingdong's right to speak, its accounts gained from suppliers are longer and its book cash is also increasing.

Jingdong began supplying loans and charging interest to suppliers in 2013. Liu Qiangdong once said that in November, he released 600 million yuan in a single month.

In the first three quarters of 2013, Jingdong finally realized small profits and gained 222 million interest income, which was closely related to subsidize the 300 million main business losses.

In 2014, Jingdong is about to launch its credit business for individual consumers.

O2O and mobile shopping are recognized as the two major directions of future business.

The Jingdong invested in the food fair in September 2013. In October, it said it wanted to cooperate with the appliance manufacturers on O2O. In November, it announced that it would cooperate with Tang Long convenience store in Shanxi to achieve 1 hours' service with its strength.

Liu Qiangdong also said that O2O was one of its five major strategies in 2014, but it still can not see much success.

The three giants of B.A.T. are peeping into this field, and the competition in maps, taxi, catering and group buying has been quite intense.

At the end of last year, Jingdong announced that its mobile phone client activated volume was 100 million, monthly active users exceeded 30 million, mobile terminal orders accounted for 15%, and the end of 2012 was 6%.

although the data looks good, the person in charge also admitted to reporters that her mobile end users had a "big coincidence" with the PC side. How to effectively display "a href=" http://www.91se91.com "> /a" on the small screen is yet to be clear.

This may mean that Jingdong's mobile terminals can not bring new business growth to them unless Jingdong can expand the three or four line city users with less user volume through mobile terminals.

Channel sinking is also one of Jingdong's five major strategies in 2014.

Mobile Internet is a more variable market. Users' usage habits and traffic sources are different.

Ma Yun's strong push to "social interaction" is a concern about WeChat's impact. In addition, the two companies began to spend a lot of money from the end of 2013 to promote their mobile payment.

Jingdong has no advantage in traffic sources and payment tools.

"The timing of Jingdong listing is very subtle."

The above executives said that if the pattern of the electricity supplier market will be subverted by the mobile terminal, then it will be a good choice to rush into the market before being subverted.

From the current market reaction, American investors are more willing to see it as a bigger and stronger Dangdang, rather than a Chinese version of Amazon.