Huicong Group Chairman Liu Jun'S Personal Letter: Decisive Battle 2020

The 2019 is Huagong group's glowing time: the comprehensive development of the first stage rocket strategy, the clear planning of the two stage rocket strategy, the steady advance of the three stage rocket strategy, and the coordinated efforts of each other to win the brilliant year of the company. Looking back on the past, looking forward to tomorrow, Liu Jun always believed that: the company can clearly and confidently develop its path of development, broad and inclusive vision of development, and carry out the team work on a down-to-earth basis, making steady progress along the way to achieve a more in-depth and comprehensive new year's development. At the end of the journey, at the foot of the road, in order to share the achievements of the development of the group with the staff of the whole year and sort out the future strategic direction, Liu Jun wrote an open letter to all the HC cons.
　　 Dear HC,
Time flies, time flies, and in the twinkling of an eye we reach the end of the year. Looking back in January 17, 2018, we put forward the idea of "becoming the leading industry internet group in China" as a vision for HC. It has been 23 months now.
In the path decomposition of vision objectives, we clearly and clearly put forward the "investment + incubator" mode to support the independent development of the six vertical runways as a first class rocket for the development of the group. This year has also become a year of frequent news reporting: following the first vertical runway valuation of 2 billion 500 million "Zhongguancun online" for financing, the second vertical runway, "China mode international" is also in the new round of financing. Here, I would like to congratulate HC on behalf of the team.
At the same time, the other four vertical runways are also developing in succession. We will continue to interpret the concept with facts: "in the field of supply chain with opportunities to reshape, in the field of heavy services, in the field of innovative business models, Internet tools will be applied, and" venture companies "have the chance to win. This is HC's Internet methodology.
　 Industry priority: Zhongguancun online link up "industry + Internet" full link
In the dimension of the first class rocket, we are not only "Internet + industry", but also "industry + Internet". At present, Zhongguancun online is rapidly transforming from the leading technology media company to the new technology retail companies. After two years of efforts, we hope to connect more than 1.5 small and medium enterprises (small B) with SaaS tools in 2020 to form a large offline network. Relying on Zhongguancun's online deep evaluation capability, we have the ability to quickly identify competitive products. In addition, we have introduced Zhongguancun's leading purifier brand "Xin Shan" into a joint venture by joint venture. Next, we will also have more competitive products to be released through the powerful media influence of Zhongguancun online, combined with our tens of thousands of small B clusters, and further open up the whole link from selection products to media, from marketing to sales.
In the future, we will have more outstanding capabilities and provide three-dimensional solutions for manufacturers in the media, marketing, sales and other links. At the same time, we have intensified our cooperation with Baidu. In the big industry of science and technology, we actively linked Baidu's "All in small program" strategy: by aggregating Baidu's strong traffic capacity and Zhongguancun's online depth service technology industry's media capabilities and business operation capabilities, we will further enhance Zhongguancun Online's ability to serve upstream manufacturers, downstream channels and consumers. Therefore, I have confidence in the future leap of Zhongguancun online.
　　 Towards the future of material banks: there is great potential for China's model international.
From the speed of development, the rapid growth of China's model international is a "miracle". Since last May, when Huicong became a shareholder, only one and a half years later, the middle module showed an astonishing profit growth capability, laying a solid foundation for this round of financing.
In essence, in a traditional high margin industry, where technology is advancing and iterating, we have established standards through self-reliance, aggregated upstream and downstream customers through platforms and services, and are moving rapidly towards the new mode of "material bank" through the "proprietary + platform".
Up to now, the size of the Chinese model team has exceeded 400 people, attracting a large number of excellent talents from China Construction, CITIC Securities and Zhongmin investment. I am very optimistic about the prospects of the Chinese model. After this financing, we must firmly develop the platform business. We are not material leasing companies. We have to be the "material bank" of the industry.
In the era of more comprehensive and in-depth digital solutions, we are moving forward.
In the past year, our third vertical runway trillion shares are experiencing the process of changing from quantitative to qualitative. In addition to maintaining the leading position in product identity, we have successfully provided a safe and stable product lifecycle management solution for many head enterprises. From the source of intelligence, wisdom production, channel management to smart marketing, we are providing more standardized digital solutions to customers through the accumulation and iterative optimization of serving multiple head customers. In 2019, we expect revenue of digital solutions to rise to more than 50% for the first time.
In the future, we will continue to expand our R & D and product marketing efforts, and provide more quality solutions for more enterprises in the life cycle in the increasingly digital era.
　 Construction of the whole industry chain new mode of electricity supplier information service: Cotton alliance entered the "rising track".
The fourth vertical runway cotton joints also developed rapidly in 2019, and revenues and profits rose sharply compared with the same period last year. Through the online trading services of "self support + matching", online financial services, direct payment and settlement services of banks and enterprises, data information service of big data applications, warehousing and supervision services of "third party + cooperation", and logistics distribution services, a new mode of information service for the whole industry chain, which is based on online data, based on online transactions and supply chain financing services, has been rapidly generated, greatly improving the efficiency of industrial operation and building a new industrial ecological chain.
The cotton alliance team led by Gong Wenlong has a strong background and a steady working style. Since 2016, the annual compound growth rate of cotton joint venture has been over 100% per annum. Sustained and steady profitability makes me confident of the development of cotton alliance.
Take the mall: don't forget the initial intention, help hundreds of thousands of small B customers get better price products.
In my view, the return of Yu Zhi Guo team has contributed to the rapid development of Huicong's fifth vertical runways, and we are confident that this year's revenue growth is expected to exceed 100%.
In my entrepreneurial experience, minimalist business logic coupled with strong executive power has always been the constant law of the rise of entrepreneurial enterprises. The essence of the shopping mall is actually an important two stage platform on the super platform chain, which brings together the tens of thousands of small B customers who have accumulated over the years. Therefore, we dare to promise the effect, at the same time also understand the product information better, not "pay by effect", but "no effect free." In essence, we prefer the distribution chain to help small B customers get better prices. In the future, with the further expansion of consumption, our space will be bigger.
　　 Hatching and buying plastic products: an excellent template for deep and penetrating industry
The sixth vertical runway is a typical example of Huicong industry company incubation. Guo Xihong, who is in charge of the business, is an outstanding representative of HC for twenty years. Two years since the group's holding, the company has provided online trading scenarios for the chemical industry. It also provides practitioners with the industry's Encyclopedia service, the premium library, and the shop's small program service, the smart shop. Because of the transaction service, we iterated the chemical industry's trading index products, and formed an industry based expert think tank, and then formed a chemical industry information base. These are valuable assets accumulated by our industry and are also in line with the rigid demand of practitioners in the vast number of industries.
Standing on this dimension, buying and selling plastic is an excellent template for HC's most industrial products industry. Buying deep plastic information services to buy chemicals, in 2018 to achieve 5 billion yuan trading services, now has a rough scale.
In the future, we are in a big blue ocean market with a market size of over 10 trillion and a small B. As long as we keep on going deep, we can keep our entrepreneurial passion and buy the future.
　　 From the beginning to the end, expand the dream: promote the two stage rocket strategy Huicong network.
During my first two years at Huicong, I focused on and supported our first class rocket, and worked with a team that was well versed in industrial pain and had strong industry background to export HC's Internet capabilities. I believe that everything should start from easy things, start from the end, return to the essence of business and return to "industry + Internet". We are still a small start-up company. In today's market and environment, it is rational to return to our early development. HC can certainly rely on a first class rocket to become an excellent enterprise, but frankly speaking, my dream is much more than that. In this era of Internet industry, I want to do a big thing. This is our two stage rocket strategy Huicong net.
For example, if the standard millet, the first class rocket and the vertical industry can be regarded as the millet ecological chain company, in the future, I hope they will become a professional platform in various fields, while the two stage rocket Huicong network can be regarded as "millet mobile phone". I have been thinking that the sales revenue of car home 40% comes from clues, that is, 1.4 000 4S stores pay, generating 3 billion revenue. In contrast, the great value of HC does not only lie in the seller's product bank and SKU. We should think about how to create a deep match and match between sellers and buyers through the "artificial + intelligence" approach, using our huge enquiries and leads, and upgrade the profit from the simple service sellers' membership fees to the two wheel drive serving sellers and buyers.
Therefore, in my understanding, the core competitiveness of HC is not only the index of figures (revenue and profit), but the number of effective enquiries and leads. We need to invest enough power in "artificial intelligence +" to break the "dot" and enlarge the "dot" on line and offline, in technology, product and artificial operation.
The essential demand of every enterprise is effective business opportunity, which is our key value. At the same time, we need to cooperate more with the head office to help our customers open the store to more places and create more contacts through a minimalist way. So I understand Huicong network's core strategy is "SME business service platform", the core value is for enterprise customers "management and operation of multi store infrastructure".
We provide more business opportunities to our customers, and also help our customers to do business more conveniently. The reason why we provide more application tools to our customers is to make our customers experience more convenient. At the same time, we also need to realize profoundly that we are unable to do everything. So we don't need to develop ourselves on tools, but we should "open our arms" and cooperate with others. As long as the customer experience can get better, we can temporarily make no profit, can be a small and medium-sized enterprise application store, open the chain from contact to workbench to thread chain, and become a successful engine matching with sellers and product libraries.
　 One or two, three level rocket synergy force, prospects can be expected
After two years of hard work, our first class rocket has been roughly established.
At the weekly meeting of HC in October 19, 2019, I asked you to make a three year plan to make greater efforts to invest. Because I always believe that industrial Internet platform companies are likely to support hundreds of billions of dreams. In the next three years, I will take the lead in this matter and do my best in this matter. Among them, the two stage rocket is a key step for HC to "move from 10 billion to 100 billion companies". It is worth fighting for.
Huicong's three stage rocket is financial technology, like Ali generates ants. Today, our three stage rocket base is still very weak, but this is a growth that follows the trend. In the future, finance will find new opportunities and growth points along with the establishment of vertical industry internet and the redevelopment of Huicong network.
On the financial front, if we can restore the real business data information of small and medium-sized enterprises, combined with the requirements of the national development strategy, the pain of banks and traditional financial services, and the rigid demand of small and micro finance, we will have the opportunity to become a valuable and dedicated credit management platform for small and medium-sized enterprises. At this stage, we are still in the stage of planning and preparation.
Recently, a new round of financing started in the middle module, which is a small achievement for us. With this opportunity, I felt that I wrote this letter to you. Looking forward to the future, our dream is much more than that. Huicong and I have to start again in this era of the Internet industry, looking at the stars in front of the sea. I have always embraced the dream of achieving 100 billion enterprises and I hope it can be realized here.
The journey of a thousand miles begins with a single step. Strategy is one, execution is nine. Strong executive ability is the fundamental guarantee for our strategic implementation and ideal realization. Today, the path is very clear. What we need is not "to do" but "to do it in place"; we are not "because we see it, so we believe it". On the contrary, all great dreams and great enterprises are "seen because of believing."
Here, I am very grateful to Yonghong and Xiaodong headed the core management team, grateful for the 3000 tireless efforts of the Hui Cong people. Let's work hard together for the achievement of an industrial Internet great enterprise.
Chairman of HC group

At the end of 12 2019, the coming of 2020 is coming.

Huicong Group wishes you all a happy new year and everything goes well.