Transformation of agricultural machinery: chain or can become a new specimen of agricultural machinery circulation

Seeing the Transformation and Innovation of Agricultural Machinery Circulation Model from the Successful Listing of Jifeng

In the course of the development of China's agricultural machinery circulation, there were only two companies that took the form of chain operation in 2006, and they only stayed at the exploratory stage. At that time, people in the industry called for speeding up the chain operation of agricultural machinery and using this new form of business organization to speed up the transformation of traditional Chinese agricultural machinery business model is an urgent matter. But after years of years, this circulation model has not set foot on the "highway" of the market. The first is that larger agricultural machinery dealers do not have enough awareness of the agricultural machinery chain or have too many concerns, and have little market expansion. Even Jiangsu Suxin Agricultural Machinery Chain Co., Ltd., which has a relatively large chain of success, is limited in its scope of influence. The second is the lack of financial strength, the lack of modern circulation management concepts, talents and corporate culture, especially the constraints of the capital bottleneck. Third, business philosophy is lagging behind, and the rapid growth of agricultural machinery chain stores cannot be achieved through the output of business ideas. Until the emergence of the Sichuan Jifeng Agricultural Machinery Chain Co., Ltd., the model of the agricultural machinery circulation chain was impressive.

As a representative of China's agricultural machinery distribution enterprises, Jifeng Farm Machinery has made outstanding contributions to the agricultural machinery circulation model by combining the agricultural machinery circulation chain with the stock market, which has greatly enriched the connotation of the agricultural machinery chain model and caused special concern for the agricultural machinery circulation industry and the agricultural machinery manufacturing industry. The circulation industry seeks to seek the direction of its own development and change from its interpretation of it. Manufacturing is trying to figure out how it will affect itself with a complex mood. One view is that the rapid development of Jifeng agricultural machinery chain can effectively solve the problem of “small, weak, scattered, and chaotic” agricultural machinery circulation in China. One view is that the Jifeng agricultural machinery is a bubble that has been blown by the stock market, and its development will be due to the turbulent stock market. Funding "intestinal obstruction" occurred, and with the breakage of the capital chain, the agricultural "empire" that they had established would collapse.

In any case, today's research on the transformation and development direction of China's agricultural machinery circulation model, Jifeng agricultural machine model as a brand-new model is not a topic. Jifeng Agricultural Machinery was founded in 1994 and began operations in 1998. In 2008, it was changed to Sichuan Jifeng Agricultural Machinery Chain Co., Ltd. as a whole. Jifeng Agricultural Machinery Co., Ltd. set three firsts in the field of China's agricultural machinery circulation in 2009: the first listed agricultural machinery chain enterprise, the first cross-provincial agricultural machinery distribution enterprise, and the first agricultural machinery chain enterprise with the fastest growth rate.

Jifeng agricultural machinery business model

Jifeng agricultural machinery model in short: "chain + stock market", will be interpreted as: operating mode is "chain", financial support is "stock market". Rely on the stock market to rapidly accumulate the capital required for development to ensure the continued expansion of the company; to achieve rapid expansion with speed; to form a large circulation industry with a chain model to enhance the competitiveness; to improve the operation quality with scientific strategy and management positioning to ensure the healthy and stable business development of.

Build wealth empire in the stock market. Jifeng Agricultural Machinery has become a star enterprise of China’s stock market overnight, and it has achieved great success since it was listed. The GEM stocks staged a collective carnival, 28 stocks rose across the board, and Jifeng Agricultural Machinery and other three stocks daily limit. Since the launch of the Jifeng Farm Machinery, the stock price has been unusually strong and the market has been able to reach a strong daily limit the next day. On November 5, 2009, the stock reached its daily limit again, and went out of the trend of 6 Lianyang. The stock price has exceeded the 51-yuan mark on the first day of listing. The daily limit on November 18 again attracted investors' attention as well as a large number of institutions. It can be seen that the Jifeng Farm Machinery has become a “hot potato” on the ChiNext.

Use the hands of the stock market to complete the accumulation of capital. On October 13th, the Jifeng Agricultural Machinery was priced at RMB 17.75 per share. It plans to publicly issue 22.4 million shares and release 4.48 million shares under the net. This means that the country's first agricultural machinery circulation company, Jifeng Agricultural Machinery, will use this to raise 39,760,000 yuan. A reporter described that: With huge financing, the Jifeng Agricultural Machinery, which originally sat on the top spot of the agricultural circulation industry, grew into a “giant” overnight.

Achieve a leap in performance with the chain. Chain management brought beautiful performance to Jifeng Farm Machinery. In 2008, it achieved operating income of 794 million yuan, a compound growth rate of 93.74% over the past three years, a compound growth of 38.57% in total assets, and a compound growth of net profit of 429.96%. The comprehensive gross profit rate increased from 5.61% in 2005 to 9.38%, 12.08% and 13.52% in 2006-2008. From January to September 2009, total operating income and profit reached RMB 1,098 million and RMB 40,680,900, respectively, which represented an increase of 76.34% and 78.72% respectively year-on-year. The first three quarters of the income is equivalent to 1.38 times in 2008.

Rapidly expand with speed. Jifeng has fully started its agricultural machinery chain operation model since December 2005. It has devastated the river and the southern half of Jiangnan. It has developed into a 70 direct-operated stores, 59 direct and indirect holding subsidiaries and 4 joint-stock companies, 550 agents. Distribution point of the country's first agricultural machinery chain distribution companies.

Guide the future with strategy. In accordance with the overall development plan of “Establishing Western China, Facing the Whole Country, Going to Townships and Serving Agriculture, Rural Areas and Farmers”, Jifeng Agricultural Machinery further improves and develops on the basis of continuously improving the level of management technology and gradually expanding the chain network based on the characteristics and development stage of China’s rural markets. Farm machinery chain business model. The first step is to rapidly complete the layout of the Southwest in 2008; the second step is to rapidly radiate 15 provinces and cities south of the Yangtze River from 2009 to 2012; and the third step is to complete the nationwide layout by 2013.

Optimize the chain model with modern management. Jifeng has established a management plan with an optimized management information system as the core, which is specifically summarized as "three stages and three platforms." In the first phase (2009-2010), a financial centralized management platform, a centralized supply chain platform, personnel management, a company-wide collaborative office platform, and online approval and internal file sharing platform were established. In the second phase (2010-2011), build a customer relationship management (CRM) platform, a human resource management platform, establish a sound CA certification/active directory/intranet security building, establish a call center (CallCernter), establish videoconferencing, internal The third phase (after 2011) of the IP Telephony System is to realize a comprehensive online intelligence within the company, build a company's online learning platform and an online professional technology resource sharing platform, and establish an online mall for e-commerce.

Jifeng agricultural machinery market and rapid development

The Jifeng model interprets the realism of the agricultural machinery chain with its excellent performance. From this we can get a lot of inspiration.

Listing brings fresh blood to the agricultural machinery chain. The Jifeng Farm Machinery passed the listing, solved the financial problems that plagued the development of the company, and injected a strong driving force for the continued expansion of the company.

Accurate market positioning is the lever for rapid business development. Jifeng Agricultural Machinery positioned the market in the southwest region where Sichuan is the center of China, selected the weak links in the agricultural machinery market in China, established a stable base area, and completed market separatism. Afterwards, the accumulation of funds (funds, experience, scale, etc.) into the country itself contains the idea of ​​strategic separatism. Jifeng Agricultural Machinery to seize the opportunity of historical development, boldly absorb the Sichuan, Chongqing and neighboring provinces and cities in the second-tier cities of outstanding circulation companies, through the integration of reorganization and strategic cooperation, greatly enhance the "joint enterprise" the overall value of the realization of "new equipment display - - Experimental demonstration - experiential marketing - full training - follow-up service "as one of the multi-functional modern circulation mode changes.

Chain mode itself has hatching function. With the help of the rapid expansion of agricultural machinery chain, Jifeng Farm Machinery quickly formed a network of agricultural machinery spread across seven provinces and one city, and stood out in the Southwest agricultural machinery market.

From a business point of view, the characteristics of the Jifeng Farm Machinery model are as follows: At the business operation level, the market value chain is the main line. The integration of resource allocation, business operation capabilities, and correctness of strategic thinking has been achieved. At the spiritual level, we attach importance to the cohesion of corporate culture. At the target and brand level, they take modernization and diversification as the long-term goals of the company and build the circulation brand of agricultural machinery as the immediate goal.

Thoughts on Jifeng Agricultural Machinery Model

One question: Does the turbulent performance of the GEM ensure the rapid expansion of the Jifeng Agricultural Machinery fund support? Some people say that the current market for the GEB is not just a single stock, but it is collectively higher, and almost all the stocks of the GEB are rising strongly. In the absence of systematic benefits, the emergence of such a market is not normal. One of the cornerstones of the success of Jifeng Farm Machinery is the successful listing of GEM and its integration of huge funds. The turmoil in the stock market has brought uncertainty to its continued development.

Second question: Is the expansion area of ​​Jifeng Farm Machinery convincing? At present, the expansion of Jifeng's agricultural machinery is mainly due to weak competition in the agricultural machinery market, such as Yunguichuan, etc., and for entering the highly competitive agricultural machinery market, such as Heihe, Lu, Xinyu, Henan, Anhui, etc., is it possible to expand Jifeng's agricultural machinery chain? How large is the space for agricultural machinery in these underdeveloped regions?

Three questions: The resistance to the circulation of agricultural machinery formed under the subsidy policy. Some people say that in the era of subsidized monopoly sales, especially the county-level agricultural machinery management department, the local agricultural machinery dealerships have long been bundled with the local agricultural machinery management department. How much can Jifeng dismantle thousands of them? In order to let the leaders of the Bureau of Agricultural Machinery risk cooperation with you in the interest chain of Siwanyi?

Question 4: With the retreat of the country, the advancement of the former state-owned agricultural machinery circulation system, the circulation system of agricultural machinery has been shown to be dominated by private capital, and the circulation of agricultural machinery in many places has already been operated by local “land snakes”. How do you want to be acquired or controlled by Jifeng?

Five questions: The gap between Jifeng's agricultural machinery and home appliances and other chain stores is huge. In 2008, the total sales of agricultural machinery in China reached more than 180 billion yuan, while the chain sales amounted to only 1.2 billion yuan, accounting for less than 1% of the total market. The annual sales income of Jifeng is 790 million yuan, which is only 0.4% in the industry. Can this kind of scale support Jifeng's agricultural machinery to create "Gome and Suning" in the field of agricultural machinery?

Question 6: Can the team's execution power and creative vitality support the rapid growth of Jifeng's agricultural machinery? Golden Valley and the DeNong chain created huge supermarket chains in 1999 and 2002 respectively, claiming to be “Wal-Mart” in rural China. However, people did not expect "Golden Valley" and "Denon" to have become historical terms in 2004.

Question 7: Nowadays, most of the agricultural machinery manufacturers have implemented a regional agency system based on administrative divisions. From the current situation, cross-regional sales are factories that are unwilling to see or support them. Therefore, the establishment of a chain store will be restricted by the original regional agency system. How Jifeng Farm Machinery Co., Ltd. crosses the agricultural machinery system is also worth exploring.

Eight questions: There is no good business brand, agricultural machinery chain business is difficult to become bigger and stronger. Whether Jifeng agricultural machinery circulation model or agricultural machinery chain model will become a specimen of China's agricultural machinery flow model, whether it can become a breakthrough in the innovation of agricultural machinery circulation model is left to the industry's thinking.

Chain can become a new specimen of agricultural machinery circulation

From the perspective of the Jifeng agricultural machinery model, the agricultural machinery circulation chain model has six major advantages: function, mechanism, scale, capital, brand, and service. It will become a new specimen of China's agricultural machinery circulation model.

Functional advantage. The operation of agricultural machinery chain takes the agricultural machinery circulation enterprise as the "leading" and the integration of production, supply, sales and research. With the increase in the scale and strength of chain-linked circulation enterprises, the functions of being more decentralized and weaker, and simply promoting the passive sales of goods by manufacturers have been extended to the main functions of guiding, organizing production, guiding and creating consumer demand, and accelerating the circulation of agricultural machinery. Industry and industry, agriculture and other integration trends.

Mechanism advantage. The chain requires the establishment of a modern circulation company system with clear property rights and standardized operations. The mechanisms of operation, employment, management, distribution, and bankruptcy are all very clear and operability is strong. These advantages are difficult for traditional circulation companies to expect.

Scale advantages. Agricultural machinery chain can quickly integrate scattered and scattered resources of agricultural machinery and effectively solve the long-term problems of “small, weak, scattered, and chaotic” in the agricultural machinery circulation industry. The emergence of large-scale agricultural machinery chain enterprises will play a major role in linking production and demand, stabilizing the market, invigorating circulation, and promoting economic development with its strong capabilities, advanced circulation facilities, and strong organizational capabilities.

From the release of Jifeng Agricultural Machinery's energy with the chain operation model, the sales network coverage has become wider and wider, changing the previously widely used wholesale sales model, reducing the intermediate links, and directly gaining terminal profits, so that the gross profit margin can be improved. The company adopted unified purchase, unified accounting, unified purchase price, and even most of the goods were sent directly from the factory to the store, which reduced the price of the product and improved the market competitiveness.

Capital advantages. Agricultural machinery chain + stock market can overcome the difficulty of fund shortage. Jifeng Agricultural Machinery Co., Ltd. cleverly solved the “bottleneck” that plagued the development of China's agricultural machinery circulation enterprises. With the help of the development funds provided by the stock market hands, it formed a rapid accumulation of capital and laid the foundation for its continued expansion.

branded advantages. Adopting a chain model can use the advantages of scale, the reputation of service quality companies, and advertising effects to provide strong support for the formation of circulation brands for agricultural machinery.

service advantage. The agricultural machinery chain integrates trade, logistics, processing and distribution into a composite business model, providing customers with one-stop service, thereby enhancing the competitiveness and living space. Changes in the simple "buying and selling", the lack of user needs system analysis and classification services.

Building the "Great Circulation" of Agricultural Machinery Industry

governmental support. Large-scale circulation is formed through chain operations, and large circulation promotes and stimulates the development of large industries. This is a universal law of economic development. Agricultural machinery chain operations should be included in national and local planning, and policies should be adopted to support and encourage the development of agricultural machinery chain operations so as to explore a new road for agricultural machinery chain management that suits China's national conditions.

Industry promotion. Nationwide, we have selectively cultivated and developed large-scale leading enterprises in agricultural machinery chain operations to integrate existing agricultural machinery marketing networks. Encourage agricultural machinery companies with the same business format or similar business content to carry out asset and business restructuring through mergers and acquisitions and alliances to drive the development of chain operations.

Industrial chain collaboration. The agricultural machinery chain should adopt supply chain management to promote the transformation of business methods. By optimizing the logistics and information flow between suppliers, manufacturers, transporters, distributors, customers, and end consumers, we can improve the operating efficiency and cost savings of the entire business network. Upstream and downstream enterprises form a supply chain, and manufacturing, distribution, distribution, and banks take the supply chain as the core and truly form an industrial chain. The agricultural machinery chain must rely on industry and banks. Large commercial and trading companies must strengthen their cooperation with industry groups and banks.

Circulation innovation. The agricultural machinery chain needs to open up value-added service channels including its own brand, and continuously expand the scope of value-added services. It has become an inevitable choice for modern agricultural circulation enterprises by providing more production value and service to manufacturers and consumers. Such as circulation companies and financial capital, provide consumers with loans for agricultural machinery.

The chain operation mode of agricultural machinery shall be expanded in information network technology and e-commerce, and provide services relating to production and operation, including membership registration, tender release, online sales, product introduction, solution provision, opinion complaints, cargo delivery and distribution, etc. Kind of e-commerce.