Sample Of Small And Micro Enterprises Under The Epidemic: Used Car Dealers Sigh, "Fortunately, The Business Contracted Last Year".

"Who could have thought of such a thing?"

In February 17th, Zhang Bin, a second-hand car dealer in Shanghai, told reporters on twenty-first Century economic report. Zhang Bin is mainly a luxury brand used car. Due to the outbreak of pneumonia caused by the new coronavirus, he has to delay the resumption of work until the end of February.

With the expansion of the epidemic, almost all industries have been adversely affected, and the automotive industry is no exception. In the whole auto industry chain, second-hand cars are especially worse. According to the analysis, although the epidemic will dampen the sales of new cars in the short term, the demand for enclosed space will increase in the medium and long term, but it will benefit the growth of new car sales.

The second-hand car industry has been slowing down in recent years, and the market is gradually saturated. In the automotive industry chain, the second-hand car industry has also gathered a lot of small and micro enterprises. Under the epidemic situation, these enterprises will face greater challenges in terms of financial strength and management capability.

Extended return time

Zhang Bin complained repeatedly that he had lost the ability to judge the market. "It's no use thinking. Now we can only take a look at it one step at a time." He said helplessly, "who has no pressure? Isn't that the case in every industry? "

Zhang Bin has been buying and selling used cars for more than 20 years. Before the new year, he was collecting cars and selling cars. But with the escalation of the epidemic, he found that his return to work had become an extravagant hope. According to his habit, the store is about to open every year at about five of the beginning of the month, but this year's epidemic has become a pressing matter of the moment.

Zhang Bin now plans to resume work at the end of February or early March, but he is not sure. "On the one hand, we return to work and declare and approve. On the other hand, no one comes to the shop to buy a car now." He said the car had not been carried out for a long time.

Zhang Bin is only a microcosm of the current automobile circulation. Recently, the research report released by the China Automobile Circulation Association showed that as of February 13th, only 32 of the 318 second-hand car dealers in the association had returned to work, accounting for 10.84%. In addition, 50 enterprises arranged for staff to take duty, accounting for 17.13%, while the remaining 72.03% did not start work at all.

The reason for the failure to start is that the local government stipulated that the time for resuming work and the application for re employment were not approved, accounting for 79%. 18% of the employees were not rehired due to the traffic barrier, and accounted for 15% of the total cost.

The resumption will increase the cost to some extent, but even if it is temporarily closed down, the cost can not be waived. Zhang Bin's business scale is not big. At present, there are 30-50 cars on hand. The company has more than 10 employees, with a cost of about 20-30 yuan per month, but he said there is still financial pressure on business.

"The pressure of rent is relatively large, which generally accounts for 20%-30% of our total cost, which is unavoidable." Zhang Bin said.

Rent is the pain point for all entities, but many housing companies have already issued relevant support policies. As early as January 28th, Wanda business management group announced that in January 24th -2 25 months, all over the country Wanda Plaza business rent and property fees to implement a free policy, recently, Huarun, Longhu, Xincheng holdings and other companies have followed up.

However, the second-hand car industry seldom shops in large shopping malls. Zhang Bin said that when they rent a place, they often turn around several times and do not directly contact the landlord, so he hardly wants to extravagant rent.

With the situation becoming more and more serious, some small shops have begun to do their best to support tenants. According to local media reports in Shandong, the second-hand car trading market in Ji'nan has also reduced the rent for one month for customers, which directly led the management to "profit from losses".

Outside the rent, Zhang Bin said relatively controllable, in general, employee wages also account for about 20%-30% of the total cost, but in the used car industry, employee salaries are largely related to sales performance.

"Fortunately, the business was contracted last year".

As for how long the fund can last, Zhang Bin did not make a clear statement, but prayed that it would work as soon as possible. "If it can be opened in March, it should be fine. But what we say is that we are just struggling. " He said.

In the automotive industry, the second-hand car industry may be the first to bear the brunt of the epidemic. Sun Shaojun, an industry insider who has been in touch with car sales for a long time, said that some second-hand car dealers' recent circle of friends, "Crazy", desperately sought buyers, and they all received cars.

Zhang Bin, who has been in the industry for many years, does not think so, but he did not think that the contraction plan he started last year was so fortunate for him. "Fortunately, I contracted business last year." Zhang Bin said, "after shrinking, the risk coefficient is much smaller."

A year ago, Zhang Bin's inventory was still around 100 cars, and covered super luxurious cars. But in the second half of last year, he began to control the inventory of about 30-50 cars, and focused on medium and high grade cars, especially luxurious ones.

Under such an adjustment, the amount of loans that Zhang Bin company has made to financial institutions has also been greatly reduced. He said that the main purpose is to take cars with its own funds, and dare not take more. "It has drawn lessons from the industry. The loan amount of the first two years (industry) is relatively high, and the capital chain is tight. Zhang Bin had a lingering fear.

Although costs are obliged to bear part, enterprises will be more relaxed if they use their own funds. When the industry is unexpectedly "stopped", smaller enterprises will be more likely to survive.

Luo Lei, Deputy Secretary General of the China Automobile Circulation Association, also told reporters on twenty-first Century economic report that second-hand car dealers are mainly small economies, and their impact will be smaller than that of other industries, but they also face unprecedented difficulties.

Large dealers may face pressure from capital chain. "It's hard for a car dealer to get money from a bank, often through financial companies and private lending, which costs more." Luo Lei said, "no turnover, no income, is always losing money."

But Zhang Bin did not shrink his business to resist the "black swan". He felt that the development of used cars had reached the ceiling. "Used car market is close to saturation. Over the past few years, too many people have been doing, and profits are getting lower and lower." He had previously predicted that business would be difficult this year, so that part of the withdrawal would be made ahead of schedule.

In fact, his judgment is reasonable. Circulation association data show that in 2019, the total number of second-hand cars in the whole country increased by 14 million 922 thousand and 800, an increase of 7.96% over the same period last year. In the past three years, the growth rate of second-hand car transactions was 11.46%, 19.33% and 10.33% respectively. The overall industry situation is not optimistic, innovative enterprises are also seeking to adjust, in mid January this year, melon seeds used cars were exposed to layoffs and withdrawal.

The epidemic is another blow to the used car industry. Recently, Yao Junhong, the founder and CEO of the search vehicle, said in an interview that the epidemic will lead to a decline in the overall demand for used cars, because the desire to eliminate second-hand cars has been reduced. "This market is actually sold with goods, but a good source of cars is scarce, and there will not be such a large volume of transactions under the epidemic." Yao Junhong said.

In order to further promote the development of the second-hand car market, the industry calls for the abolition of the limit, the reform of the VAT collection method and the promotion of the temporary registration system. These measures will solve the shackles of second-hand car development from the system level, but for the current small and micro enterprises, as Zhang Bin said, "the key is to have business to do."

(Editor: He Fang)

?