To stay away from the competitive, tractor enterprises need to do six things!
In the past few years, the competition situation of domestic agricultural machinery industry has been intensified obviously, and the competition in tractor industry is even more lethal. Ten years ago, there were still rules of play in the domestic tractor industry. Although competitors had competition with each other, they were not fierce. However, now we seem to be unable to see clear rules of the game, nor the laws of the market. Even some enterprises are constantly breaking through the bottom line, and the vicious competition is dragging the industry into a abyss of endless disaster.
The tractor industry is a dark forest. Every company is a hunter with guns, and it is a ghost. In this forest, others are hell, which is an eternal threat. Any life exposed to the range will be destroyed soon - the law of dark forest!
Chen Chunhua said: the ultimate goal of competition is to stay away from competition! Only by escaping the range of competitors can enterprises ensure their own safety and develop.
If every enterprise takes low price as its basic condition for entering the market, it will be exposed to the range of its opponent. So, how to get away from competition and jump out of range requires six things to do.
1、 Block new entrants
For tractor enterprises, the big competitors or the competitors who threaten the enterprises are not the existing ones, but the new entrants.
The author has counted that, from 2010, the tractor industry has to generate at least 10 new brands every year, and 25 new brands enter the market in more than one year. What is the threat to the existing enterprises by new entrants?
The new entrants of domestic tractor industry are all operating in the light assets way, which is based on the ready-made product system, accessory supply system, sales network and service system of large enterprises such as Dongfang Hong and Lovol heavy industry. These enterprises are low cost and high starting point, because there is no investment in R & D, fixed assets and services, The so-called "barefoot is not afraid of wearing shoes", when entering, it is low price competition. What is terrible is that the configuration and quality level of these new brand products may be equivalent to the large brand, even higher than the big brand, but the price is much lower. The competitive advantage in the market terminal will be very obvious, which has exceeded the competition category of "bad currency expelling good currency".
Therefore, tractor enterprises can only do their own things well, because the value of the enterprise is in the market and the market determines the internal of the enterprise. Therefore, the tractor industry must have competitive thinking. The existing enterprises must pay attention to the new entrants. If the industry makes people feel that there is a lot of money, people are stupid and fast, there will be a rapid influx of new entrants. Why can Xiaomi and Huawei mobile phone succeed? The key is Apple's high pricing. For a long time, Apple's profits account for more than 90 percent of the profits of mobile phone manufacturers around the world, so such a huge profit will certainly attract a large number of enterprises to help the sword and fork rush.
Enterprises must stop new entrants, or the tractor industry will never have a good time, so how can we prevent new entrants? The idea of applying China and China company is to make good two pricing, the first is the price of industry products, and the second is for employees.
The first is the pricing of the product. Because of the huge profit space in the industry, more than 200 enterprises will be attracted to enter. If large enterprises have great wisdom, they will take the lead in lowering the average price of the industry, and reduce the profit space of the industry, which will strike the enthusiasm of new entrants. Many people will give up. If the sales price of large brands is lower than the current three-tier and four line miscellaneous brands, Can anyone else ask for a miscellaneous brand? In the same year, Shuanghui, Galanz and so on were able to go out of the house through constant price reduction.
So the question comes, big brands keep cutting prices, where does the profit come from? Profit comes from scale effect. Only when large enterprises sweep out small enterprises, no one has the ability to compete with large enterprises, large enterprises can earn money by scale effect. Scale effect is a kind of ability, only large enterprises can support them.
The second is the pricing of employees. The pricing of employees is the treatment of employees, especially for the high-value employees with ability, which must cover the cost of his or her entrepreneurial opportunities. That is, it is better for the staff to stay in the company than to go outside and do more cost-effective, so that he will stay.
Domestic large tractor enterprises, especially those of Lovol heavy industry, Dongfang red and Dongfeng Agricultural machinery, must solve this problem. Because 210 tractor enterprises, 80% of the entrepreneurs come from these enterprises, indicating that the enterprises do not do well in the benefit distribution mechanism, so that employees can venture and start businesses without satisfying the existing income.
The agricultural machinery industry has passed the strategic stage of guerrilla warfare, which is "what you beat you, I fight me". At present, the existing brands have entered the position war, even the short-term alley war stage, and the existing brands must try to prevent new competitors from entering, and eliminate the surrounding competitors in this even the most important stage, and realize the continuous concentration of market share, "Monopoly can generate excess profit", endless competition is the whole industry no profit and national industry let the competitors in foreign countries.
2、 Improve the self-made rate of core components
Nowadays, no one is an island, and there is no certain enterprise can close the door to produce. Therefore, it is very normal for enterprises to get some parts through the form of outsourcing. According to Coase's view, the internal manufacturing cost of the enterprise is higher than the external transaction cost. It is economic and wise to purchase accessories from outside. In fact, the domestic Lovol heavy industry Zoomlion Heavy Industry and Weifang and hundreds of tractor manufacturers around them adopt the mode of large number of parts outsourcing.
A large number of component outsourcing can effectively reduce the investment in fixed assets, shorten the time of new product development and reduce the risk of entrepreneurship to a large extent. However, the negative product of outsourcing mode is the technology spillover and the subsequent homogenization pain.
Enterprises must know what to outsource, what must be self-made! The author thinks that the way to avoid or reduce the homogenization competition intensity is to improve the self-control ability of enterprises. For tractors, the self-control ability of four parts or four assemblies of engine, gearbox, axle and control system is the main method. In addition, if the small assembly or semi-assembly such as steering gear, transmission, lifter and other small assemblies can make their own, it can effectively reduce the homogenization competition.
From the global perspective, johndir, kessnew Netherlands, krass, AGCO, jiubaotian, as well as domestic brands, such as Dongfang red, Dongfeng Agricultural machinery, and other international and domestic head brands, the engine, front axle, transmission system chassis and other core components are basically self-made.
For example, one tractor with complete domestic large and medium-sized tractor "internal gold supply chain" - Dongfang red diesel engine, ZF-1 trailer bridge, Dongfang red gearbox, one tractor and multi steering gear, etc., and a relatively closed internal supply system effectively prevented followers and imitators. Therefore, less than 20 of 203 tractor brands in China imitated one trailer product, The rest is all imitated by Lovol and Ningbo, and the problem is that the supply chain of Lovol and Benye is outsourced.
3、 Innovation and unique competitive advantage
Competition exists only on the premise of product homogeneity. As long as your products are different from others, there will be no competition. When you do not innovate, there will be competition. When you innovate, the competition disappears.
We must understand the as like as two peas. In the domestic tractor industry, the fiercely competitive models are Futian chassis and Ningbo chassis. Small businesses are trying to make products exactly like Rev. O and Ningbo diel. The purpose is to borrow big brands to reduce the cost of entering the market. In this sense, small businesses should seek common ground while big enterprises should seek differences. At least at this stage.
Schumpeter said that only innovation can make profits, and only one kind of profit is innovation profit. If tractor enterprises have been competing with others for price, the price will always slide to cost like free fall. The profit is thinner than paper, that is, life is thinner than paper.
Therefore, only innovation can enterprises have profits, especially large enterprises are placed under the spotlight. The innovation of large enterprises will soon lead to the imitation of competitors, which leads to the disappearance of profits. Therefore, large enterprises need to innovate constantly. Only if the speed of innovation is faster than the speed of imitation, enterprises can get excess profits.
If an enterprise wants to obtain long-term innovation profits, it is necessary to establish barriers to competition and imitation. The good way is to build a new business combination, that is, Michael Potter's "competition strategy", and it is impossible for the competitors to imitate one element with systematic power to deal with competition. However, it is very difficult for competitors to learn multiple elements.
4、 Creating irreplaceable recessive competitive power
The power that can be seen and imitated by competitors is not real competitive power, the real strength is invisible, or it needs some effort to find it. It is the iceberg hidden under the water. What can be seen is high people, but there are not many people who can learn.
Tractor industry is now competing for this, the dominant strength is not enough to ensure that the enterprise can live to the next round of development cycle, enterprises must establish their own recessive competitive strength, so what is the recessive competitive power of tractor enterprises?
What are the real strengths of multinational companies such as Caterpillar, John deer, casenew Holland and so on?
It is not known that scale, brand, core, talent, etc., any visible advantage can easily be learned and imitated by competitors, and will lose its advantages soon. Some competitive advantages are invisible at all, such as industry standards, internal management processes and structural models.
Here, it is said that the structure profit is so that the tractor industry can skillfully apply this tool when the industry shuffles the brand.
The profit is generally divided into scale profit, brand profit and structural profit.
Scale profit plays a role when they have scale and competitors have no scale, and no longer have effect when all competitors have scale effect; Brand profit is brand premium, if the enterprise has strong brand, but when there are several big brands in the industry, or the user is rational, the brand profit will not play a role; The third kind of profit is structured profit.
At present, multinational companies such as Caterpillar, John deer and kessnew Netherlands have already entered the structural profit model. In the structural profit model, no "explicit business" makes money, and all "hidden business" is profitable.
So what is the "hidden business" of multinational companies?
Look at John Deere and you know. As one of the world's largest agricultural machinery manufacturing enterprises, the credit sales model of global business has been very mature, and it is also the first agricultural machinery enterprise to use financial leasing to promote sales in China. The Credit Department of dill company has been established for more than 100 years. In many countries, there are credit subsidiaries, joint ventures and branches, and as one of the largest equipment financing companies in the United States, Johndier financial services manages more than 1.8 million accounts and manages assets of nearly $30billion.
Opening John Deere's portal, we can see that there are only three business items in John deer: equipment, financing, parts and services. The equipment, parts and services are owned by domestic enterprises, but financing is the short board of domestic brands, which is "hidden business". The competition between real large enterprises is the "hidden business" behind.
The "hidden business" of multinational companies mainly includes financing, insurance, equipment overhaul, remanufacturing, second-hand agricultural machinery trading and other businesses. I believe that many domestic brands know their shortcomings and short boards as long as they are compared.
To sweep out small brands, of course, we should use the competitive tools and means that small brands can not provide, and the real strength should be the hidden power that the competition does not have and can not see.
In addition, there are also establishment of industry standards or influence the development of industry standards. This is the advantage of large enterprises and groups. Through the standards affecting the production access and subsidy policies of the state or industry, enterprises can obtain a good operating environment. In turn, they will be excluded from mainstream enterprises and will become the victims of the standards.
5、 From factor competition to system competitiveness
The so-called element competition is "one move, eat all day". In the past, small companies in tractor industry used low-cost competition, or "small horse drawn cart" to play the edge ball of subsidy policy. Large enterprises relied on brand advantages or the reputation of the accumulated industry users.
In the fast-growing market, enterprises can do better than others by breaking through single elements only by seizing a market opportunity.
But in the future, the competition of tractor enterprises should be changed from single factor breakthrough to system winning. At least the enterprises should integrate two systems, one is supply chain system and the other is market chain system.
Supply chain system is a production support system. To be competitive in products, it is necessary to maintain two supply chains, internal and external, and provide reasonable profit space for suppliers of parts, assemblies and semi-assembly. It is also developed synchronously in product development, so as to win the competitive product quality and shorten the time of product listing to compete for the first chance; Market chain system is the link that the product flows through from the factory to the consumer.
In the 21st century, the competition between enterprises is actually the competition between the industrial chain and the industrial chain.
6、 Development speed: never stop, run out of danger zone quickly!
In animal world, we will see that as herbivores, antelopes, etc., heaven has not given them more pity than other animals. The little horned horse and gazelle should learn to stand and start running with full strength from the birth, otherwise they will soon become a good meal for hyena and leopard.
So in the animal world, speed is the first rule of survival. When gazelle wakes up every morning, it knows that it must run faster than the fast leopard, otherwise it will be eaten. When leopard wakes up every morning, it also knows that he must catch up with the gazelle that runs slower, or it will be starved to death. Life pursuit, faster people can survive, this is the African prairie survival law.
Domestic tractor industry is also "grassland ecology" at present. Competitors are everywhere. If you want to survive, you must run like gazelle on the African prairie. If you fall down from the antelope belly, you must start running. If you run early and run fast enough, you can get a chance to run out of the range.
The industrial chain of domestic tractor industry is very complete. The new brand is in a high starting point. With the help of industrial cluster or capital, the new brand is running at high speed and high speed, and quickly following the dangerous zone. In a short time, the enterprise can enter the safety zone
It is obvious that speed is the first, in any industry, small enterprises survive and develop, even surpass large brands, without speed is impossible to complete the task, while big brands should be ahead of competitors, and step on the small brothers at the foot, and also try their best to run. As long as they are fast enough, they will stay away from the competition and enter the safety zone before the competitors.