Dunhuang net Wang to venture hard: Sell cars for buying servers

Intermediary transaction SEO diagnosis Taobao guest Cloud host technology Hall

Since 2005 the creation of less than 1 million U.S. dollars in turnover, to 2008 turnover of 200 million U.S. dollars, the Dunhuang net spent more than three years, the growth of nearly 100 times times.

Wang, CEO of Dunhuang Network

"It's estimated to be a 300 million dollar turnover this year, and our core business will focus on that in the future." "Dunhuang Network CEO Wang to this newspaper reporter said.

and is in Dunhuang on the sale of custom-made clothing, because the European and American artificially expensive, domestic custom products can and overseas terminal sales have a huge difference, so that overseas buyers have a strong demand.

"Dunhuang's model of collecting transaction fees abroad has also been successful, but there will be some differences in the field, so the future should be concerned about whether such a model and field have enough market space to support the making of a large company." GGV partner Sun Wenhai said.

A tough deal charging model

The domestic production of products through the Internet to sell overseas, the previous relatively successful model is Alibaba. The 1999 Internet company, which was launched in November 2007, had a market capitalisation of $28 billion trillion.

Alibaba is the user's registration fee. Unlike Alibaba, the Dunhuang Net collects about 7% of the cost of the transaction from the buyer and seller as a service charge.

At first, Wang, the CEO of Excellence, has done offline trade, but later found that business-to-business E-commerce prospects are good.

She believes that China has 3000多万家 small and medium-sized enterprises, manufacturing capacity is astonishing, but the profit margin is limited, through e-commerce exports accounted for only 4%, and Wal-Mart, Carrefour and other retail giants with its global network advantages in the global purchase of low prices, the local small and medium-sized retailers have formed a strong impact, These small and medium-sized buyers urgently need to find low-cost procurement channels.

And as the first "eat crab" use this kind of pay for the transaction, the purpose is to better attract customers and to do this value chain of the core part.

Wang Sad to recall that there was a big mountain in the front of Alibaba, the outside world will continue to question whether this innovation can go down. In the past in excellence, she is a relatively successful entrepreneurial manager, but to do when Dunhuang moved to a very poor place, tables and chairs are also shabby, which is also the test of emotional nerves. "Just on the line after half a year, almost no cash on the account, each month on the salary of the next month how to do, to add the server how to do, can only Zaguomaitie home car sold." ”

But this is only one aspect. From the inside, "This road has never been traversed, so every employee will think that the road can go on, while doing things while thinking that this matter is not possible." She said helplessly.

And the outside is bad, the most poignant example of her is that the Dunhuang network has been looking for a ceramic enterprise, promised to help each other to take pictures of products, network display, when its employees riding motorcycles to do this thing, but finally the enterprise is not willing to put the product up. At that time Dunhuang was free to provide these services, but this is the case, the company did not agree.

"Pay for the sale of the seller, there is no cost, after all, only a deal to pay for the site, it takes a lot of courage." "Walk Xiu Net Vice President Shangxiang thinks.

In fact, not long after the establishment of Dunhuang, Wang to find VC financing. But financing the road is exceptionally difficult, although in the outstanding CEO, but "the creation of Dunhuang large and small VC have seen also difficult to melt."

And such a road after a big six months, the Dunhuang net finally in January 2006 to get the first venture capital, from the Kai Peng Hua surplus and set rich in Asia a sum of money.

"One of the main reasons they voted for me is to see the orders coming in, which is proof of the future of our business model," he said. "Wang introduced.

7% of the transaction fee will be too high, the seller's profit is sufficient?

"The transaction fee is based on the seller's offer and we add it, so the seller will first weigh whether there is enough profit margin, and we will have different transaction costs according to the different industries and products, but the overall view is about 7%." The Dunhuang net a market department personage introduces.

"Our goal in the future is to build as much as possible a low-cost platform for sellers to sell through the platform." "Wang said.

"Dunhuang and Alibaba positioning is not the same, so not too comparable: Dunhuang sellers relatively small, if a year to pay so many dues, for them is a bit difficult, the use of the method will be more appropriate." Said Wang Fang, vice president of the consultation.

According to Alibaba's financial statement, 2005-2007, its growth rate of about 100%, 2008 its growth rate of about 39%.

The Dunhuang network estimates that this year's turnover will be one-fold more than last year, to about 2.5 billion yuan, calculated its revenue nearly to 170 million yuan, but it did not disclose the profit margin.

Where is the demand?

In fact, finding out where the demand will be is one of the core issues of the Dunhuang Web site.

"Before the first round of financing, we seldom do promotions, just send information to some forums, link to some key websites, etc." Wang recalls.

Later, after the financial and development, the whole promotion on the combination of Google search engine, exhibition, Network Alliance and line under a variety of ways, "I also want to learn new means of promotion, and then to have professional experience to do, because there will be many different types and characteristics of the method." "she said.

And the most popular Dunhuang online products include: Cosplay clothing, such as customized product, because the customized products can not be mass-produced, in Europe and America are very expensive, in China to produce one thousand or two thousand yuan can sell custom clothing, overseas can sell to nearly million. There are real wigs, in Europe and the United States market, although a lot of wigs, but with real hair made of wig is very rare, so, such things in foreign countries have a good sales price.

In this sense, Dunhuang is similar to bridging the gap between the resources of a platform, such as human costs.

There is a network design platform, is the use of such human resources between the gap, such as the overseas need to carry out some software design, some patterns and logo design and other aspects of the work, it will be published on the website of the project, the domestic designers to design a good biography, and the site is charged a certain proportion of the intermediate fee; Because of the relatively high cost of manpower overseas, it is possible to complete the relevant software design and projects in China with relatively low prices.

Because of participation in the transaction, "Many of the transaction data and requirements, we can grasp, so we can give better guidance to suppliers." "Wang introduced.

"The potential risk is that if some manufacturing moves to lower labor costs such as India, such business-to-business sites will also have the flexibility to expand the scope of the seller's business and to increase the flexibility and diversity of profitability to hedge risks, such as Chinese buyers sourcing Indian products, etc." "Wang Fang Analysis.

Not afraid of Alibaba to enter?

Whether on the Internet to open a retail store, or offline retail outlets, the Dunhuang network aimed at the group is a large number of scattered very broad small and medium-sized vendors, each individual's purchasing power and bargaining power is limited, and through the Dunhuang network it can be on the same commodity "group order".

"This can be better close to the end of the demand, because like Wal-Mart and other bulk procurement, take a cup for example, the volume of its procurement, but less models, but here we can buy a variety of models of cups, and even personalized and customized; As far as the buyer is concerned, the effect of the group is great. "Wang said.

and through Dunhuang procurement of overseas vendors procurement cycle is very short, it is likely every 1-2 weeks to purchase, frequency is very high.

The advantage is that, for these vendors, inventory pressure is small, its ability to resist the risk of strengthening, such as once related to devaluation or appreciation of the currency, orders large enough to make a long time, it is possible because of currency exchange rate changes lead to loss of money.

For value-added services, the Dunhuang network will have a number of such orders and unique derivative products, if in the major ports and countries, there may be some long-term procurement of products, such as every two weeks may have to purchase three to 4,000 U.S. dollars of accessories, so can be in some cities for warehousing, "these have historical data, even if there are some withdrawal orders, But because the buyer is very dispersed, it has little effect on the whole. "Wang explained.

In addition, the spelling is also a common practice, as time will have a lot of goods to the same place, the Dunhuang network will collect the relevant information to send the goods together to help save costs.

Because in the case of a certain scale, before the use of PayPal services to pay about 8% of the cost, through the Dunhuang net only to pay about 2%, "we will continue to introduce this value-added services, through this way to create low-cost platform, and increase the stickiness of the platform." "Wang said.

Do now, for the Dunhuang network business model of doubt.

Imagine if Alibaba did something similar, would it have any impact on the Dunhuang net? Just as the blog network has been hit by Sina and other strong shocks.

In this regard, Wang that the first to do excellence, most of the flow is from Sohu and Sina and other sites, so at that time, we think will Sohu and Sina do similar mall, excellent can not live?

"It turns out that Sohu and Sina do not do well, and Alibaba and we are two different models, in the internal operation, it is always facing which decision first, which decision second question." This model also requires some enterprises to compete, only heavy companies to enter will produce better companies. We believe that there will be a lot of different ways, because even if there is a difference in strategy, magnified to the result will be very dissimilar. Wang said calmly.

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