Cogobuy listing and then vertical e-commerce industry

Reporter Ji Jiapeng in Hong Kong

On July 18, the vertical electricity supplier Cogobuy City, an electronic component supplier, was officially listed on the Hong Kong Stock Exchange under the code of "00400" with a financing scale of about HK $ 1.4 billion. The stock opened at 4.00 Hong Kong dollars, unchanged from the issue price.

According to the issue price, the company listed on the scale of financing amounted to 1.372 billion Hong Kong dollars, if the underwriters exercise over-allotment option, then the figure will reach 1.58 billion Hong Kong dollars.

Cogobuy is a B2B vertical e-commerce company that specializes in IC components. It is also launching new business and new models around the electronics manufacturing supply chain and hardware innovation.

Cogobuy's Chairman Kang Jingwei told reporters in the 21st Century Business Herald that there are currently 3 million manufacturing enterprises in China with annual purchases of about 10 trillion yuan, while IC components account for 2 trillion yuan. "Cogobuy will go through the IC components to import, master the data, make it easier to understand the customer's behavior, and use the big data to do other services like finance in the next step."

Heavy vertical electricity supplier

Unlike most e-commerce companies, Cogobuy has always been profitable. Prospectus shows that Cogobuy's revenue for 2013 was 2,417 million yuan, net profit of 86.57 million yuan; in the first quarter of 2014, revenue was 1.35402 trillion yuan, net profit of 28.99 million yuan, an increase of 2.5 times over the same period, net profit increased over the same period 3 times.

IC component e-commerce customers than the average consumer price of electricity is much higher. According to the prospectus, in 2013 Cogobuy's average customer price of 147,000 yuan, the first quarter of 2014, this figure was 168,000 yuan.

As of December 31, 2013, there are about 500 suppliers to Cogobuy's supplier network, including top suppliers in major product categories, such as Freescale, which provides automotive components, and smart mobile Broadcom device components and flash Di and so on.

In fact, for many terminal manufacturers, especially the current developers of hardware innovations, the supply chain of IC components has always been very opaque. Small developers can not directly contact with large suppliers due to the small demand.

Kang Jingwei said that Cogobuy has a parent company of Comtech Group in the field of IC components 20 years of experience in distributors and components self-operation is a threshold. "So I'm not worried Alibaba will come in and snatch the cake together."

Based on this opacity in the supply chain, Cogobuy's model is to connect the needs of the downstream industry chain, to focus on the upstream supply chain demand, the equivalent of a component of "buy."

21st Century Business Herald reporter learned that the current IC components involved in the online transaction sites are Cogobuy, Made in China, Global Sources, Alibaba and Huaqiang electronic network. However, apart from Cogobuy these websites mainly provide information services and do not have a proprietary platform for operation. Cogobuy core is mainly in the form of self-employed electricity supplier. Third-party platforms account for about 10% of overall revenue.

In general, self-employed electricity suppliers need to bear the risk of inventory. "In accordance with our agreement with the supplier, we can not sell the goods, you can return to the supplier for new goods to sell, but the current return of the proportion of a few percent." Kang Jingwei 21st Century Business Herald reporter Say.

WeChat service 80% of customers

Kang Jingwei told reporters in the 21st Century Business Herald that at present, Cogobuy's annual turnover is nearly 10 billion yuan. As of the first quarter of this year, there were 3,100 customers, including 100 key customers of ZTE and Lenovo, Customer contributed 50% of revenue. "The next three to five years' goal is to have annual sales of 100 billion yuan and 100,000 to 200,000 customers."

Kang Jingwei said first of all need to find the target customers, converted to registered users, and ultimately into trading customers. At present, there are more than 60,000 target customers and more than 20,000 registered users. The main reason for the low conversion rate is that the products are high-end products and will expand the products to second- and third-tier suppliers in the future.

It is noteworthy that, with the general electric company burn money to make marketing to buy users, resulting in delays in achieving profitability, Cogobuy will put marketing costs in a certain range.

"Thirty-five key decision-makers in a company decide on the actions of the company. If three or five individuals in the decision-making circle can form a community and Cogobuy only needs to influence these key people, The purchase decision into the volume of transactions. "Kang Jingwei said.

In 2012, after KC Resident Exchange with Zhang Xiaolong of Tencent WeChat Business Group, Cogobuy became the first business platform to make use of WeChat's service electronics manufacturers. In January 2013, Comtech launched the "Core Cloud" App and embedded Core Cloud's user interface into WeChat, using the same cloud computing system as the background infrastructure. 21st Century Business Herald reporter learned through experience, "cloud core" allows users to access account information anytime, anywhere, and the implementation of the entire procurement process, the system will automatically answer questions raised by users, and opened up the above companies in the transaction when the various departments With all aspects.

It is understood that 80% of Cogobuy's customers are now served through WeChat. The internal target is to serve 100% of its clients through WeChat before the end of 2014, and the current repeat purchase rate is over 90%.

E-commerce platform extension

Cogobuy's smart hardware platform "hard egg contest" is in fact a familiar community for many intelligent hardware developers.

Kang Jingwei said hardcore moved from one activity to a mobile Internet community, and later slowly saw the pain points of innovators, began to use the resources of the supply chain to help hardware innovators, the Internet ring and manufacturing supply chain docking. "After listing, the next step will be through the mergers and acquisitions Cogobuyin investment, hard eggs into a global platform."

Kang Jingwei said that after the listing, the company is more transparent and the management takes greater responsibility. However, the choice of Cogobuy because the business model relies heavily on the support of third-party partners and the listing of suppliers and commercial banks Partners feel more transparent information, which is conducive to the development of cooperation.

In addition to continuing to develop hardcore products after the IPO, Kang Jingwei said he will use customer data to provide services other than selling components such as supply chain finance, which will be started in the second half of this year.

Kang Jingwei told reporters in the 21st Century Business Herald that Cogobuy will work with commercial banks in Hong Kong to further develop its lending channels for its SME customers.

"Supply chain finance clients will be our existing customers, because according to historical data we can accurately determine the number of customers, than banks know their risk." Kang said that the main purpose of supply chain finance is to solve the small and medium enterprises The problem of liquidity encountered in production is, in fact, many enterprises are likely to expand their businesses if they are not financial problems.

"I've been able to detect customer data and processes from start to finish and form a closed loop, and we've got thousands of customers together, like bringing 1,000 businesses together and talking to HSBC about a billion Of the loan is actually very easy. "Kang Jingwei said that as long as there is data, basically all business models can sit down and talk to provide various types of loans for the enterprise. (Editor Lu Aifang Xin Court Wei)