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Looking at the 123th Canton Fair 1: African engine crankshaft market is hot, the traditional traders have a single profit model is too low

Looking at the 123th Canton Fair 1: African engine crankshaft market is hot, the traditional traders have a single profit model is too low



In the spring of 2018, the Canton Fair kicked off. The Hugo network team once again arrived in Pazhou, Guangzhou, closely following the swing trend of China's foreign trade export vanes, truly solving the problem of information asymmetry between the needs of overseas markets and the supply of domestic manufacturers, and standardizing foreign trade export selection. Focus analysis of trends of goods and trends. Hugo.com will continue to provide first-hand information on the status of international supply information and product changes for domestic manufacturers and foreign trade companies, and solve the practical needs of domestic sellers to sell well in the sea.

Whether it is cross-border e-commerce sellers or traditional foreign traders, the number of orders is naturally better. But if I tell you, someone is constantly rejecting snow-like orders, and because of the large number of orders, you believe it? Xiao Bian met such a boss at the Canton Fair – General Manager He Jizhao of Guizhou Sanli General Machinery Manufacturing Company.

Jumping out of the quagmire of domestic industry price wars and focusing on overseas markets

It is understood that Guizhou Sanli General Machinery Manufacturing Co., Ltd. is a private enterprise specializing in the production of crankshafts for automobiles and construction machinery engines. Currently, it produces more than 15,000 engine crankshafts for various types of automotive and engineering machinery, involving more than 300 varieties. Different models, and this number continues to rise.

He Jizhao said that the products produced by his company are mainly sold to Africa and the Middle East. Countries such as Europe and the United States have also been involved, but their proportion is relatively small.

“In Africa and other countries, the demand for engine crankshafts is very large, because the market for used vehicles in the country is relatively large, and if consumers refit the original engine crankshaft when renovating a used vehicle, the cost is higher, and the engine crankshafts we produce are not only The quality is excellent and the price is also very attractive. The cost-effective products naturally become consumers in the African market."

For the European and American markets, He Jizhao said that there are also some “custom processing” production, but because the European and American markets are too strict on the quality inspection of such precision, precision manufacturing imported products, their company’s products do not have a competitive advantage in the US and Europe markets. .

"The engine crankshaft competition in the domestic market is also very fierce, not that our products are not competitive, but too many competition with the industry, often will inevitably fall into the vicious cycle of price war - the lower the price The lower the manufacturer's cost of production, the lower the cost of the product, and the result that can only be a drop in product quality.The engine's crankshaft, as the 'large artery' of the entire car, is of poor quality, and will bring huge safety risks to consumers. This is not only not conducive to the growth of companies and manufacturers, but also not conducive to the development of the entire industry. Therefore, most of our orders are orders for foreign trade," said He Jizhao.

Talking about the core competitive advantages of the product, He Jizhao summed it up into two points: price and quality. “Our company has been involved in the production of engine crankshaft for more than 20 years. The establishment of the factory has a history of 7 or 8 years, and it is rich in production. The professional experience; In addition, in the raw materials of our products, our factory and raw material suppliers are also separated by only one wall, and we can strictly control the source of material supply, and the broken-axis rate of the products is also very low, which has been recognized by customers. In terms of prices, the crankshafts of our engines are much lower than those produced by foreign manufacturers."

Established its own foreign trade company and wanted to open up production and sales.

It is reported that during the eight years since the He Jizhao plant was established, the annual orders are showing a trend of rapid growth. This development momentum allows He Jizhao to see the broad prospects of the engine crankshaft in the foreign market, but at the same time, He Jizhao also discovered that The increase in the number of orders brought him only more work, but did not bring him more revenue. The reason is that the profits are too low. Such low profits also once caused Ho Jizhao to fear a large number of single.

“We are a production-oriented enterprise, and basically 90% of the sales channels at the bottom are realized through traditional foreign trade companies. We have too little profit for such a model; at the same time, we cannot directly reach out to the front-line consumer customers. We also have no way of getting more market information. It is too easy to go head-to-head with production. It is too easy to derail the market,” said He Jizhao.

In response to the above issues, He Jizhao is also actively seeking solutions. He said that the foreign trade company has been established. The future goal is to hold an entire link from production to sales and even back-end services in their own hands. At the same time, they are also very happy to seek new development in cross-border e-commerce channels. .

In addition, Hugo.com also learned that the 123th Canton Fair was the first Canton Fair to be attended by He Jizhao and was not exhibited as an exhibitor. Its main purpose was to understand market conditions. “We did not participate in the Canton Fair, but before that, customers used our products to come to the exhibition at the Canton Fair. The purpose of this trip was mainly to understand the market conditions. Through the observation in the morning, we discovered about 4 or 5 manufacturers who are similar products. The basic situation is similar to what I expected."

For the cross-border e-commerce channel, He Jizhao also showed a strong interest. He said that the development of cross-border e-commerce is the trend of the times. At the same time, through the channels of cross-border e-commerce, he can also solve the two problems that plagued him most -- profit. Low; out of touch with the market.

“Whether we form an operation team, operate a cross-border e-commerce business on our own, or distribute products for a large number of cross-border e-commerce sellers, we can get a very large margin in terms of profits. Not only that, we can use cross-border e-commerce channels. Direct contact with consumers in the first-line consumer market can directly get a lot of consumer feedback. We can also better understand where consumers need to be, and can only find a reasonable direction in product optimization.” He Jizhao preached.

(Text / Hugo Net Zhang Yi)

Source: Hugo Network Time: 2018-04-16 10:14:25

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