Rongsheng Group: From Legendary Years To Hard Times

PTA production line

In 2016,

The sales revenue increased by 8% compared with the same period last year, and the total profit increased by 295% compared with the same period last year. The tax on the turnover increased by 85% over the same period last year.

In the first quarter of 2017, thanks to the sustained release of upstream industries and the innovative drive of polyester fiber chemical industry, the operation situation of Rongsheng Group continued to show a steady and steady trend, with stable production and good profit growth.

Time retrospective, starting from 8 shuttle looms, and if this year's revenue exceeds 80 billion yuan, the investment industry involves petrochemicals.

In the field of real estate, trade, finance and other fields, the layout of "prosperity and prosperity" has become more and more complete.

"Three steps" create legendary myths and legends

In 1989, Li Shuirong, who runs a small timber company, was interested in the China cloth market.

In the same year, the domestic cloth market was surging, and the price war was imminent. But Li Shuirong had different views on the crisis of cloth industry. He said: "under relative conditions, there are business opportunities behind the crisis.

Business is also available before the storm.

There is only one way between Shaoxing and Xiaoshan. Why can't Xiaoshan people do business in Shaoxing?

After a year of watching and analyzing the cloth market, Li Shuirong made an unexpected decision in 1989.

At the time of the decision, Li Shuirong did not think much of it, but felt that it would be more profitable to do cloth business than to make lumber.

Starting from 8 shuttleless looms, the starting point was the $200 thousand sold out of the lumber and the whole household. The factory hired 6 idle old cottages at that time, and employed more than 20 local workers.

At that time, Li Shuirong's behavior was called "impulsiveness" by many people. He sold all his family and hard wood but jumped into a risky, competitive market.

But Li Shuirong started his career since then.

And gradually showed his extraordinary talent in the textile industry. He established the business strategy of "market determined products". The factory grew bigger and bigger, and achieved the success of the early stage of business. By the end of 95, the scale of the enterprise increased from 8 looms to 100 looms.

However, success is always accompanied by setbacks.

Entering the 1996, the entire textile and chemical fiber industry entered a trough period, and some large and medium-sized enterprises went bankrupt or switched to production. Some people expected that the bowl of rice had already ended.

The situation has posed a severe test for Rongsheng company, which has just taken a firm foothold: after the "head water" of the Xiaoshan chemical fiber industry has been changed after the "filament" for the "bullet" projectile project, does the development of Rongsheng continue to make breakthroughs on the basis of adding bombs? It has decided that the Rongsheng chemical fiber company, which has booked the projectile and ordered the equipment, then launched a historic and substantive "big discussion" for the development of the company: is the industrial chain extending downstream or upward?

The downward movement means that the development of the company will develop towards the labor-intensive direction. Its shortcoming is that the market competition is fierce, the products are easy to be imitated, and there are too many downstream enterprises. The advantages of downstream are: relatively low demand for technology and capital, relatively simple production, and small market risk.

And upstream, large investment, high risk, high technical requirements is the biggest problem; but upstream, less competition, high value-added products, high input will bring high returns.

At that time, China's chemical fiber industry is entering a low ebb. Many enterprises have turned to another development. At this juncture, Rongsheng's "anomaly" has come up with a lot of sarcastic remarks: to "hang up".

Of course, Li Shuirong took this "plate" under the "single" and did not talk big. He was convinced that his decision would not be biased.

In the face of cloth industry, it has become a group of price competition, very narrow run space.

Li Shuirong studied the market at home and abroad, and made a lot of market research in Japan, Australia, New Zealand and other countries. It was found that today, when the weaving factories are killing each other, the manufacturers of chemical fiber materials become beloved, while the domestic manufacturers of chemical fiber materials are few. Why not turn to chemical fiber raw materials? The development of this industry will present unlimited business opportunities.

Although the investment cost of chemical fiber raw materials project is scary and tens of millions, but if we go downstream, the future is very slim.

If we continue to make bigger and stronger in the chemical fiber industry, we must extend the industrial chain to the upstream.

So, still decide: on the polyester and elastic yarn project! People are secretly sweat for Li Shuirong!

In 1998, the textile industry became warmer and the demand for dacron and spandex increased greatly. This year became a glorious harvest year. The output value of the company increased to more than 100 million yuan and occupied a place in Xiaoshan's textile industry.

People worried about Li Shuirong finally breathed a sigh of relief.

In 2001, the output value was 1 billion yuan, and the output value exceeded 10 billion yuan in 2006.

In just 6 years, without the courage and boldness of Li Shuirong, a decision maker, it is impossible to fathom.

Li Shuirong's business has already been achieved in Korea, Japan, the United States and Europe and Africa.

PTA, polyester, spinning, and bomb integrated production, Rongsheng's industrial chain and technological pformation measures are all first class.

In 2002, riding the spring breeze of Xiaoshan industrial "100 billion", Li Shuirong seized the opportunity to invest in more than 3 hundred million tons of 180 thousand ton polyester direct spinning project put into operation, mainly from the United States Contas and Germany's Bama.

At the same time, from Japan, Murata introduced several 33H machines.

Li Shuirong did not stop.

Decided to take the road of brand changing to famous brand.

Subsequently, Rongsheng set up Zhejiang Yisheng Petrochemical Co., Ltd. in Ningbo, and built the first PTA production project in the province, and put into operation in March 2005.

Refining and chemical helps to "take off" from upstream to downstream

Some people worry that once the Zhoushan Green Petrochemical plant is put into operation, China's oil products market, especially the East China market, may face more overcapacity. But Rongsheng holds that refining and chemical equipment can not only produce refined oil, but also produce other chemical raw materials, which is needed for the overall layout of Rongsheng industry.

PTA (terephthalic acid) is one of the most important bulk organic materials, widely used in chemical fiber, light industry, electronics, construction and other aspects, of which the polyester used for textile accounts for 78% of the chemical fiber, and the polyester fiber accounts for 75% of the total PTA.

Arene

Our clothes and mineral bottles come from PTA, PTA's raw material is PX, the source is oil, and Rongsheng does not have refinery equipment, but can only buy chemical raw materials from the market.

Because there is no upstream refining capacity, the situation of raw materials being controlled by others is more prominent.

Zhoushan is located on the island of the East China Sea and the Yangtze River, and its location is convenient. Moreover, because of the construction of Islands petrochemical base, its petrochemical security is also very convenient.

This project is known as the "Zhejiang No.1" project by the Zhejiang provincial government. The main leader of the province is the project leader, and the Zhoushan local government attaches great importance to it. It stems from a greater ambition to build Zhoushan into a first-class free trade port, including the petrochemical base.

Today, Rongsheng has accumulated rich experience in raw material procurement, and has established extensive contacts with large oil companies, traders and manufacturers in the world, and has conducted in-depth cooperation and close business contacts with Core Company.

In addition, Rongsheng set up a trading company in Singapore, the Rongsheng Petrochemical (Singapore) Pte limited, as an overseas sourcing, selling and trading center. It is an important platform for Rongsheng to participate in international market cooperation, strengthen financial management and supply chain management.

Relying on this platform, Rongsheng will co-ordinate its actual production, Global trade and financial management needs, and cooperate with the world's large multinational organizations, traders and the three party organizations to establish a stable and win-win cooperation relationship.

By the end of 2016, Rongsheng had established business contacts or trade contacts with more than 60 mainstream companies in more than 20 countries and regions around the world.

It is not difficult to tide over difficulties.

According to Rongsheng group, the general trend of the industry in 2017 will be steady and steady, but the recovery will not be too large.

In this trend, enterprises must first improve their internal strength, continue to strengthen the control of cost and quality, and secondly, we should increase innovation and enhance their adaptability to the market.

The diversified development of enterprises can be divided into different fields and pluralism in the field. The development of interdisciplinary diversification depends on the conditions of the enterprises. It may not be suitable for every enterprise, but diversification in the field should be a trend for most enterprises to consider. It includes the extension and extension of related industries and the continuous enrichment of product types.

In terms of Rongsheng, diversification is mainly embodied in the diversified development of petrochemical and chemical fiber industry with core competitive advantages: constantly extending and expanding the industrial chain and developing new products, that is, the vertical and horizontal strategy of enterprises.

Rongsheng's diversified business is always based on its core business and develops relevant business on this basis to form a stronger market competitive advantage.

In the face of complex and changeable market, Rongsheng's main way to solve the problem of scientific research pformation is to highlight the role of bridge and link between the market and R & D institutions. On the basis of fully understanding and collecting market information, we can share information with R & D institutions or our R & D team, identify innovation needs, and speed up the efficiency of R & D and pformation.

The current macroeconomic environment, especially the international political and economic structure, is still uncertain. It is difficult to judge what stage the market is in and the future development and change.

But Rongsheng always believed that the textile industry has always been one of the basic industries of the national economy, and its overall development space exists. And with the development of its own level, the expansion of application fields and the development of the national economy, this space will be bigger and bigger.

In the future, the industry reshuffle should become a norm. The future competitive enterprises must have their own core strengths, and they may not be comprehensive, but they must have their own unique advantages in a certain field.

Automatic inspection

All along, Rong Sheng knows that the development route should be determined according to the conditions of the enterprise, including technology, talent, capital and the accumulation of various social resources.

Not necessarily all enterprises must develop towards a certain mode. On the contrary, personalization and differentiation may be a common mode of enterprise development in the future. According to their own resources, they can form their own advantages and seize their own market.

In the next three to five years, Rongsheng will mainly deploy strategic plans in two directions, focusing on refining and chemical integration projects in the upstream, and implementing new differentiated fiber projects in the downstream.

As far as polyester polyester is concerned, Rongsheng's research and development will mainly focus on two directions of functionality and comfort, such as profiled fibers, high burning point negative ion fibers, PTT/PET blended ester fibers, etc.

At the same time, we will further accelerate the pformation of scientific research and further upgrade product grades and development specifications through the building of intelligent new factories.

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