How to make low cost operation of electric dealer

Can you do electricity business without burning money?

2011 to buy the main electric dealers are unusually hot, in the end of the operation mode of burning money many electric dealers lost even fell. This year, the general profitability of the electric business sector, so that the confidence of capital investment plummeted, and even affected the whole industry investment enthusiasm. Data show that VC in the first three quarters of this year the overall investment fell 60-70%,VC raise capital fell 70%. At the same time, PE total investment fell 40%, raising capital fell 70%. For start-ups and VC/PE, the 2012-year slowdown is doomed to a "cold winter".

The suffering of the electric business enterprise is the most clear to the electric merchant. The international financing environment is tight, the management has tightened up the money bag, the overall financing heat drops, the electric business enterprise's Day gets more and more sad. This winter seems to allow many electric traders see no thawing of the dawn. 2012 is certainly the toughest year for entrepreneurs.

Can you do electricity business without burning money? Where is the electric dealer's spring?

How does a power trader return to light assets?

Electric Dealer? Courier business?

Many electric business enterprises believe that the key to E-commerce competition lies in goods and logistics, the long tail of the theory, the majority of electrical goods and not many characteristics of the difference, so the real battle of the battlefield is logistics, relying solely on Third-party logistics to fight, many times E-commerce enterprises will feel that the force. As a result, the heavy investment in logistics makes the electric business become heavier. The business model, which was once thought of as a short process and a light asset, is getting heavier.

Jing Dong now has two identities, one is the electric dealer, one is the express company, and has already got the express operation license. Jingdong Mall 2009 began to build a logistics system. At present, in Beijing, Shanghai, Guangzhou, Chengdu, Wuhan has built a logistics center, self-built Logistics system has covered more than 60 cities. 2010, Jing Dong Investment 20 million yuan set up "Shanghai round Mai Express Company" to support the company's logistics and distribution. 2011, Beijing-East to build the "Asia number" project, its Shanghai Jiading bought 260 acres of land, to create Asia's largest modern logistics center. This year is the third year of massive investment in logistics and information systems in Jingdong, the most expensive year. It is expected to invest 35~36 billion, including land, property, a variety of equipment procurement, is the most expensive year. Jing Dong Logistics team has more than 10,000 people, and according to business development needs, will continue to expand.

Dangdang in early 2011, announced that it will take the lead in the formation of a dangdang-holding distribution services company, to create an independent logistics open platform for E-commerce enterprises to provide commodity storage, sorting, packaging and the country more than 1200 cities of goods to pay (COD) services. As for the logistics construction, at present, Dangdang has realized in Beijing, Shanghai, Guangzhou, Zhengzhou, Tianjin, Langfang, Dongguan, Suzhou, Wuxi, Changzhou and other more than 30 major cities 70% users enjoy the day service delivery.

High cost of logistics

Express Company profit and loss line of 350,000 pieces/day, and every customer's "such as wind Tatsu" because only a customer, let it only a hundred thousand of of the day shipments, the result of higher logistics costs. 2011 A guest's "typical" order, the composition is roughly as follows: Customer Unit price 108 yuan, product cost 71.5 yuan, logistics cost 14.5 yuan, spread to one of the marketing cost of 26 yuan, other operating costs 23 yuan. Obviously, this logistics cost makes the profit of every guest become thinner. This let has been to low-cost high quality for the label of every customer products in the price is compromised. From the industry's only successful Amazon experience, the integrated logistics costs below 10%, the electricity business may be profitable, but to achieve this requirement, the enterprise under the heavy asset system is difficult to do. Self-built logistics is difficult to profit, became the sword of Damocles.

Self-built logistics does not cover remote areas

Since the construction of the logistics system has indeed covered many cities nationwide, but delivery range, delivery speed is difficult to protect. Known as the 30 billion self-built logistics of Jingdong Mall, currently can not complete all the business distribution alone, so far in the two or three-line cities continue to work with Third-party logistics companies. In the city of Zhuzhou, Jingdong logistics for the urban area than the region is not delivery, can only be transferred to other logistics companies again distribution, but lengthen the delivery time and the logistics cost. Another shopping experience is more interesting, in Beijing east of the settled shop bought clothes, more than half a month did not see delivery, and many phone complaints, the repair of the clothes quickly arrived, after half a month, the original order of the clothes but suddenly Shanshan, let people both happy and gas.

Self-built logistics is difficult to be compatible with third party logistics

Is that today's business-to-consumer is far from being able to become self-sufficient in its own logistics, and because of the expansion too fast, in the original unified storage of proprietary goods, when, Jingdong, Fank and excellence of these businesses began last year, large-scale "investment" to Taobao Mall model, so many foreign merchants on its website to build shops, But these merchants all over the country are difficult to merge with the electrical business of their own logistics system.

Electrical Business Surname

There is not a foreign electric company to do logistics success. In fact, once known as hundreds of billions of self-built logistics Alibaba, its logistics role positioning is also changing. This year, the Cat Logistics will invest 100 million U.S. dollars in the logistics company, and in just the past "double 11" big promotion, the cat is the choice of the domestic nine Express company mode of cooperation in order to better serve the main business of electricity, in order to improve customer logistics satisfaction, but not the logistics.

For the electric business, if the logistics to the third party to do, the cost can be cut off half. If the electrical business does not invest in warehousing and logistics, it does not burn money. Gradually from the logistics of heavy assets to withdraw or even cut off, the electricity dealer back to the electricity, it will become a light company.

In the capital of winter, how to reduce risk, low-cost operation?

Zero Inventory Management

The purchase cost is a huge cost to the buyer. If you can achieve zero inventory management, this cost will be reduced to zero.

Business-to-business and Business-to-consumer are the two basic business models of electric dealers, but they are all former electric business models, the future of the electric business model will eventually move towards C2B. Because, the core of the C2B is production, to achieve zero inventory, the first to sell then efficient supply chain organization, or the supply chain of the organization has been completed, must be based on sales of the situation to determine the arrangement of production. C2B through the commodity ladder price and the non-ladder price two kinds of forms, by the Internet unique superiority, can the low cost quickly disperse the demand aggregation, and leads and stimulates the consumption power. The C2B model also helps businesses more accurately target consumers, advance stock, and manage upstream and downstream supply chains more effectively. October 15 this year, the days of the cat "double 11" sales promotion officially opened, the consumer landing on the pre-sale platform to pay a deposit before the end of the payment can buy things, pre-sale merchandise, including scarce goods, collection of goods and personalized according to consumer goods. This is regarded by the industry as the new exploration of C2B mode. Now the cat has been on its platform to promote the large-scale pre-sale, in order to achieve zero inventory. Next year, the C2B will be launched by the sale of the zero inventory model in the Electronic business large-scale application.

Low cost financing

1. Pre-Sale Order financing

In the electronic Commerce environment, the pre-sale order financing has the reality and the operation value. Acquisition of pre-sale information mainly through the Internet in a short period of time to gather a single dispersed consumer demand, to the seller a collection of large orders, the seller in advance to obtain orders, by virtue of customer orders to bank financing, and then production enterprises with good credit buyer product orders, in the technical maturity, The production capacity has the guarantee and can provide the effective guarantee under the condition, by the bank provides the special loan, for the enterprise buys the material organization production, the enterprise after receives the payment to repay the loan immediately. The presale mode can truly release the advantage of the traditional brand quotient in the electronic commerce War, and can be optimized from the back end, the middle end or the front end of the supply chain. While giving consumers preferential treatment, it also protects the seller's profit. If the pre-sale financing can be widely implemented in the electricity dealers, the electric business enterprise and the producer can be freed from the high cost "accounts payable" and the 3-month long "account period". The introduction of bank financing to achieve "0 capital" operation, and can achieve the optimization of supply chain management. But this kind of pre-sale financing to the electric business platform and the merchant's marketing, the information integration ability and the credit put forward the higher request.

2. Supply Chain Financing

The timely attribute of e-commerce technology makes every data of foreign trade service supply chain be collected and controlled, and provided to financial institutions to realize the customer's trade chain financing. The Supply chain financing service does not demand the enterprise to provide the fixed assets mortgage or the guarantee, but increases the pledge of goods or the assignment of accounts receivable as the credit condition, in order to control the logistics and account receivable as the risk control means, provide the supply chain financing service for the small and medium-sized enterprises. The network financing channel generated by the electronic commerce platform and the bank credit platform is providing new source of funds for the small and medium-sized enterprises, changing the financial payment way for the enterprise, connecting with the international payment habit, and realizing the order "open source".

Low cost payment settlement

Cod has always been the main way to pay for online shopping in China, especially in the consumer market, nearly 70% of all transactions are done through the use of the C.O.D. Domestic electric dealers actively build their own logistics system, but also for the delivery of goods to pave the core to ensure the security of the goods. Their own logistics, their employees, their own collection of money, control the customer logistics experience. But the payment on the goods to the electric business to look very beautiful. Because, this payment model does not have the advantage of electronic commerce to play out at all.

Payment by cash, on the one hand, related to the issue of capital security, over the years, the electrical business has been plagued by the collection of money security issues, although the companies to guard against, but can not fundamentally solve the collection payment is defaulted on things happen. Cash on delivery is to increase logistics costs, the second is to increase the cost of operating costs, the third is to increase communication costs, four is to increase the risk of return. Who is the cash on delivery? Logistics company is the first profit. Once a piece to earn a freight, now a reject to earn two times freight, so, the logistics industry favorite goods to pay, and always encourage customers to reject. And the use of electronic payment has a number of advantages, such as deposit, pre-sale payment, credit card payment, mobile payment, currency exchange payment, micro-payment, etc., therefore, electronic payment has become the inevitable choice of low-cost payment.

Acquisition of Third-party payment tools, this applies to the strength of the capital of the electric companies. Jingdong is now truly aware of the importance of controlling the third payment to the electric dealer. In the experience of August 24, 2011 Jingdong Mall to Alipay to pay the expiration of the name, stop and Alipay cooperation since the turn to pay UnionPay online. This November 22, Jingdong Mall CEO Liu for the first time to billion state power network publicly admitted that Jingdong Mall has officially acquired net silver online. Jingdong before the main business is self-employed, most orders based on cod, through the POS machine card to solve the problem of customer payment. With the expansion of the Beijing-East open platform business, the platform merchants need to have a new online payment system to support, so it is necessary to buy a payment company to make up for the lack of online payment function platform. And the use of electronic financial platform to become the first choice for SME E-commerce. The financial chain of small and medium-sized enterprises is fragile, in addition to timely financing support, scientific and efficient management of funds more needed. Otherwise, the enterprise funds will not be able to meet the operational development requirements, thus falling into the continued expansion of financing finally unable to bear the cost of financing the situation. The advantage of the new electronic financial platform is to reduce the intermediate links to the greatest extent, thus greatly speeding up the efficiency of capital transfer. The use of Third-party electronic payment, the general use of t+1 or t+7 settlement, capital turnover rate significantly increased dozens of times times. At the same time, because the sum of money by the third party to pay the unified collection, management, the income of several websites are all displayed in the backstage system, the data indicators can be queried immediately, and each employee according to the different authority, the control of the limited amount, so that the utilization of funds greatly increased, the amount

After card payment, network payment, mobile phone mobile payment has become the new favorite. Mobile phone Alipay currently has 40 million users, and PC computer online payment ratio of 1:9. The average mobile Taobao completes 83,000 transactions per hour, selling 155,000 items. This year "Double 11" mobile phone taobao turnover reached 930 million. At the same time, such as the United States network, handle network, Air China Mobile phone applications, such as mobile E-commerce development, to help the mobile payment demand for a large increase. Although mobile payments currently account for a small percentage of the total transaction amount in China, it is 2.5 billion trillion dollars, but the forecast will grow to $40 billion by 2014. Purchases of tickets, digital books and music will show the greatest growth. By 2015, the proportion of mobile phone payments will reach half. According to Juniper, a market research firm, the amount of transactions handled globally by mobile payment services in 2015 will increase from $240 billion trillion to $670 billion this year. Mobile payment becomes the inevitable choice for the future electric dealers to realize the low cost payment.

Conclusion: From the whole electric business industry, the previous failure of the electric business enterprise led to more cautious investors in the future, the capital market tends to rational return. Investors tighten their wallets and businesses are hopeless at reducing costs by slashing jobs and shrinking fronts. At present for a large number of serious reliance on VC blood transfusion of electric business enterprises, their winter has indeed arrived. Many E-commerce enterprises in the development process is keen to pursue capital, hope has been in the capital of the rapid development of blood transfusion, and once the capital pulls away, inevitably fall to pieces. The depression of the capital market makes the electric business enterprise from crazy burning money to rational management, we are in the same market environment, the industry shuffle will accelerate, healthy direction of development, but also to promote the industry to fair competition.

To burn money is not to burn the electric business model, the electric business must understand and grasp the nature and law of the development of E-commerce. Return to the essence of electrical business, to electronic service business, in order to withstand the capital cold, ushered in the spring.