Strategy is choice, strategy is positioning. Good strategy and tactics can make enterprises get rid of the predicament, get back to life and win victory. The global financial crisis triggered by the US subprime mortgage crisis has sounded a warning bell for wire and cable companies that have been twisting ahead in the spiral. They do not change their minds from their minds, and they do not study the problem-solving methods from the marketing level. Enterprises are difficult to develop. The further you go, the greater the risk of bankruptcy.
First, the cable industry is facing a lot of pressure
According to incomplete statistics, at present, there are more than 7000 wire and cable manufacturing enterprises in China. The scale of production in the industry grows in an unordered manner, the utilization rate of equipment is less than half, and the profits of enterprises are falling. Many enterprises maintain capital or profit.
In addition, the huge fluctuation in the prices of raw materials such as copper and aluminum is the main cause of the decline in the average profit rate of the wire and cable industry.
It is understood that for every 5% rise in raw material prices, the relative profit will decrease by 4%. Therefore, from the beginning of 2007 to the first half of 2008, as the price of raw materials in the cable industry continued to rise, companies purchased large quantities of raw materials such as copper and aluminum. However, the outbreak of the financial crisis has caused the prices of commodities and non-ferrous metals to go down all the way, and the impact of exports has made it difficult for enterprises to hedge their raw materials for a short period of time. The capital chain of enterprises is very tight.
At the same time, the cable industry is very serious and fake, poor quality wire and cable filled with a turbid market, non-standard products are also endless. Low value-added products, increasing product homogeneity, intensified low-price competition, lack of brand leadership, extensive marketing management models and other issues are indisputable facts.
The demand side of the product, when selecting cable products and signing contracts, has set layers of thresholds, allowing cable companies to fall into a whirlpool that cannot be extricated. According to industry sources, in general, there are three aspects of the cable industry's supply and marketing contracts that are not conducive to the shortcomings of the cable companies: First, contracts signed for various reasons (such as the financial crisis to cancel orders, the termination of the contract) cannot be implemented. Lead to a large amount of backlog of wire and cable companies, resulting in huge losses. The second is the cable supply and sales contract, which mostly adopts a 'closed contract'. In this kind of contract, the demand side does not bear the risk of any raw material price increase. (Because of the characteristics of production, the wire and cable manufacturing companies have a period ranging from 1 to 2 months to 24 months from tendering, winning the bid, to organizing raw materials, production, and delivery. Due to the excessively long time, the price risk of the material during the period It is impossible for any business to bear.) Third, the payment method is unreasonable. At present, domestic adoption of the '1-8-1' payment method is still widespread, and even '1-4-4-1' is used. Cable companies' liquidity turnover adds extra difficulty.
Inequality in the contract, unreasonable payment methods, coupled with too large fluctuations in raw materials, leading to low technical content requirements, low value-added cable companies are overwhelmed, liquidity is shrinking, and the company’s financial position Stalled.
At this time, many companies have shifted their focus to marketing efforts, hoping to improve their performance by changing their marketing models and strategies, thus greatly improving their profitability. However, many companies do not formulate corresponding sales strategies and models based on their own actual conditions and characteristics, resulting in more detours and lower costs.
C. Human resources
(1) When recruiting new employees, sign a trade competition agreement. In order to avoid the vicious competition in the cable industry and to effectively avoid the risks posed by the vacant employees, before recruiting new employees to join the company, it is recommended that they sign a trade competition agreement and a core technology confidentiality agreement.
(2) The contract manager went to the company headquarters to suspend his duties. Contracting managers are basically all 'old birds' and have strong sales experience, but they have long been stationed abroad and become 'biggers in border areas'. The company is difficult to control. Why not let them upgrade their headquarters and hang a virtual job, so that they can pass on their successful sales experience to newcomers, and at the same time, give them some improvement in respect of new pay.
(3) The company organized and recruited 'old birds'. Experienced sales personnel can bring maximum performance to the company, and through the input of fresh blood, the company can be more energetic, and the former 'old birds' who have been in the company for many years will feel a certain pressure, so that They are more active in their work.
D. Brand promotion
(1) Improve brand DNA and brand promotion methods. Brand DNA refers to the brand's core values ​​and brand personality. In the past, cable companies did not pay much attention to the promotion of the brand, and they started from the price side, making the profits of the company lower and lower. Therefore, it is necessary for our cable companies to implement corresponding brand strategies, weaken the past relationship marketing components with the strength of the brand, retain old customers with technology, strength, service, and reputation, and win the favor of new customers.
E. Corporate Culture
(1) Brainwashing training for employees + corporate culture. Regardless of whether the new or old employees, we must regularly organize learning and training, on the one hand to improve their business capabilities, and on the other let them understand the corporate culture in the training, so that they better integrate into the team.
F. Company Development
(1) Establish a second-level subsidiary, engage in joint stock cooperation, and jointly operate with complementary advantages and resources sharing. Contracting managers generally achieve a certain scale and their enthusiasm has been reduced. The company can negotiate with them and jointly fund the establishment of a joint-stock company so that they can become the 'head' of the subsidiary so that they can grow together with the company.
(2) Develop high-end products, dilute standard products, and increase product gold content. A good product can win the trust of customers even if the price is higher. Only by improving product quality and producing differentiated things can we survive in the market. At present, China has become a global leader in cable production, but more than 80% of high-end cables such as submarine cables, nuclear-grade cables, military cables, ultra-high-voltage cables, and railway signal cables rely on imports. If we can make breakthroughs in these areas, companies will have a lot to offer.
We are delighted to see that some cable companies have targeted the high-tech emerging fields of ships, aerospace and military, new energy (wind energy, nuclear energy), and hope to be able to navigate the unique blue ocean.
G. Industry Development
(1) Do fine work in subdivided industries. Cable companies should combine their own advantages, combined with the direction of industrial development, to produce unique products in the sub-industry, so that they will have core competitiveness.
(2) Further narrowing the regional market.
So how do we implement these coping strategies are reasonable and what are the good paths and methods?
1. Equipped with technical support personnel, establish a form management system, and improve the action plan.
2. Improve the process assessment system and quantify management of process assessment to achieve key information control.
3. Gradually weaken the dealer's technical support department and rely on the company's unified technical support.
4. Implement sales process control and establish a project operation mode in which dealers and companies are mixed.
In short, we must continue to play steadily with the advantage of local contractors or dealers in the local geographical location and human resources, so as to realize the complementary advantages of companies and distributors and the smooth transition of channels, in order to gradually weaken the local contractor (contract manager) or The personal role of the distributors, and then the company's project-based sales and process control.
Second, two marketing models for different size companies
Our IMSC Research Institute of Industrial Products Marketing has provided customers with two types of marketing strategies that are suitable for the operation of different cable companies through years of valuable experience in consulting and training customers in the cable industry. One is the contracting system, which focuses on training and digging. Grasping single masters, in order to give these salespersons ample sales performance, using personal contracting methods to motivate those who have been in the industry for years and years of sales elite - 'old bird', in order to enhance the company's overall sales performance; One is the large customer system, which mainly relies on stable teams, clear division of labor, integration of all company's superior resources, expansion of space through major customer marketing strategies, and provision of good products and back office support for these large customer companies.
Through our research and analysis of the Institute, the two marketing models are suitable for different types and sizes of companies. Because there are five major problems in the general contracting system, this system is more suitable for those enterprises with small scale, low cost of sales and production and operation, and relying on the ability of individual companies to adopt. For those companies that have a clear team division of labor, relatively stable business, relatively standardized management, and relatively easy expansion of marketing space, they should adopt a large client system. (See Figure 1) In this way, it can enable different companies to find their own development direction in marketing strategy, but also can dislocate competition, develop corresponding products in their own 'Blue Ocean', and tap for their own customers. Not for?
Third, how to implement the contract system to large customer system 'transformation'
When we provided consulting and research for companies, we discovered that some cable companies engaged in contracting systems also tracked large customers. However, with the continuous increase in marketing costs caused by the development of new projects or tracking of new customers, it caused the “oldâ€. Birds' reluctance to use their own pockets to maintain large customer relationships hinders the development of the company. Therefore, we must find some effective methods to better encourage these 'old birds' to grab large orders for enterprises. As for some enterprises whose scale has grown from small to strong, they must also undergo a sales transformation and gradually shift their marketing focus to the large customer system.
So what exactly does our cable company do? The following are the six countermeasures we listed from the perspectives of project information, project management, human resources, brand promotion, corporate culture, company development, and industry development. We hope to inspire and think about the marketing transformation of cable companies.
A. Project Information
(1) Encourage the original contract manager or regional manager to focus on attacking major customers, and the company will provide corresponding supporting policies. In general, one of the big reasons why contract managers are unwilling to attack large customers is that they are afraid that the marketing investment will be too large and the money that is thrown away will not be returned. At this time, our cable companies should introduce more preferential incentives and provide effective assistance in the negative aspects of marketing expenses, so that contract managers will have no financial worries when developing large customers. According to the practice of sharing the sales expenses between the head office and the contracting manager, we can usually award the maximum amount of commission based on the proportion of the sales expenses incurred by the parties in the contract and the actual expenditure after the contracted transaction, payment and delivery.
(2) The establishment of a large customer department to assign special personnel to collect provincial (city) level key project information. In many cases, due to the fact that contract managers are busy with busy business all day and resources are limited, information screens are blocked, and information of large customers and large projects cannot be grasped in a timely manner. By specializing in a large customer department, it can effectively and systematically collect important information in all aspects, and it can effectively avoid the risk that key customers are only in the hands of a few people.
(3) Implement a project reporting system and establish standardized customer information information. The advantage of establishing a project filing system is that it can firmly control the initiative and control of the project at the company level and effectively avoid certain risks. General cable enterprises can formulate corresponding project filing systems according to their own market capacity and sales. For example, large orders above 5 million yuan must be filed in detail, and some small-value orders can be flexibly delegated to ordinary sales personnel.
(4) Manage newcomers with standardized processes. There is no rule and no circle. New employees must organize learning and training as soon as they enter the company, instill scientific and systematic processes into them, and let them use an institutionalized process to process each sales list. With the corresponding guarantee.
B. Project Management
(1) The senior management of the company pays a return visit to key customers. In general, key customers are old customers who purchase or use their products many times and receive services. These customers are loyal to the company's products. A high-level visit to these key customers will allow these companies or individuals to feel that the company respects them and lays a foundation for further cooperation in the future.
(2) The customer service department is listed separately and directly controlled by the head office. Today, many well-known companies have established separate customer service departments with the goal of understanding more directly the problems encountered by customers and better serving customers. It is better for the sales staff to face the customer directly than for the customer service department to solve the actual problem in a uniform and standard manner. It is also beneficial to thank the customer.
(3) Turn the contracting manager into a project manager, equip it with a corresponding project team (sales support, business support, technical support, etc.) and turn the original personal assessment into a team assessment. Enterprises can appropriately allocate technical and sales support personnel to the contract manager. This can weaken the individual ability of the “old bird†through the strength of the team, make it feel that the company has not owned him and operate normally, but if they participate in teamwork, they can work together. More handy, the value of the harvest is even greater.
First, the cable industry is facing a lot of pressure
According to incomplete statistics, at present, there are more than 7000 wire and cable manufacturing enterprises in China. The scale of production in the industry grows in an unordered manner, the utilization rate of equipment is less than half, and the profits of enterprises are falling. Many enterprises maintain capital or profit.
In addition, the huge fluctuation in the prices of raw materials such as copper and aluminum is the main cause of the decline in the average profit rate of the wire and cable industry.
It is understood that for every 5% rise in raw material prices, the relative profit will decrease by 4%. Therefore, from the beginning of 2007 to the first half of 2008, as the price of raw materials in the cable industry continued to rise, companies purchased large quantities of raw materials such as copper and aluminum. However, the outbreak of the financial crisis has caused the prices of commodities and non-ferrous metals to go down all the way, and the impact of exports has made it difficult for enterprises to hedge their raw materials for a short period of time. The capital chain of enterprises is very tight.
At the same time, the cable industry is very serious and fake, poor quality wire and cable filled with a turbid market, non-standard products are also endless. Low value-added products, increasing product homogeneity, intensified low-price competition, lack of brand leadership, extensive marketing management models and other issues are indisputable facts.
The demand side of the product, when selecting cable products and signing contracts, has set layers of thresholds, allowing cable companies to fall into a whirlpool that cannot be extricated. According to industry sources, in general, there are three aspects of the cable industry's supply and marketing contracts that are not conducive to the shortcomings of the cable companies: First, contracts signed for various reasons (such as the financial crisis to cancel orders, the termination of the contract) cannot be implemented. Lead to a large amount of backlog of wire and cable companies, resulting in huge losses. The second is the cable supply and sales contract, which mostly adopts a 'closed contract'. In this kind of contract, the demand side does not bear the risk of any raw material price increase. (Because of the characteristics of production, the wire and cable manufacturing companies have a period ranging from 1 to 2 months to 24 months from tendering, winning the bid, to organizing raw materials, production, and delivery. Due to the excessively long time, the price risk of the material during the period It is impossible for any business to bear.) Third, the payment method is unreasonable. At present, domestic adoption of the '1-8-1' payment method is still widespread, and even '1-4-4-1' is used. Cable companies' liquidity turnover adds extra difficulty.
Inequality in the contract, unreasonable payment methods, coupled with too large fluctuations in raw materials, leading to low technical content requirements, low value-added cable companies are overwhelmed, liquidity is shrinking, and the company’s financial position Stalled.
At this time, many companies have shifted their focus to marketing efforts, hoping to improve their performance by changing their marketing models and strategies, thus greatly improving their profitability. However, many companies do not formulate corresponding sales strategies and models based on their own actual conditions and characteristics, resulting in more detours and lower costs.
C. Human resources
(1) When recruiting new employees, sign a trade competition agreement. In order to avoid the vicious competition in the cable industry and to effectively avoid the risks posed by the vacant employees, before recruiting new employees to join the company, it is recommended that they sign a trade competition agreement and a core technology confidentiality agreement.
(2) The contract manager went to the company headquarters to suspend his duties. Contracting managers are basically all 'old birds' and have strong sales experience, but they have long been stationed abroad and become 'biggers in border areas'. The company is difficult to control. Why not let them upgrade their headquarters and hang a virtual job, so that they can pass on their successful sales experience to newcomers, and at the same time, give them some improvement in respect of new pay.
(3) The company organized and recruited 'old birds'. Experienced sales personnel can bring maximum performance to the company, and through the input of fresh blood, the company can be more energetic, and the former 'old birds' who have been in the company for many years will feel a certain pressure, so that They are more active in their work.
D. Brand promotion
(1) Improve brand DNA and brand promotion methods. Brand DNA refers to the brand's core values ​​and brand personality. In the past, cable companies did not pay much attention to the promotion of the brand, and they started from the price side, making the profits of the company lower and lower. Therefore, it is necessary for our cable companies to implement corresponding brand strategies, weaken the past relationship marketing components with the strength of the brand, retain old customers with technology, strength, service, and reputation, and win the favor of new customers.
E. Corporate Culture
(1) Brainwashing training for employees + corporate culture. Regardless of whether the new or old employees, we must regularly organize learning and training, on the one hand to improve their business capabilities, and on the other let them understand the corporate culture in the training, so that they better integrate into the team.
F. Company Development
(1) Establish a second-level subsidiary, engage in joint stock cooperation, and jointly operate with complementary advantages and resources sharing. Contracting managers generally achieve a certain scale and their enthusiasm has been reduced. The company can negotiate with them and jointly fund the establishment of a joint-stock company so that they can become the 'head' of the subsidiary so that they can grow together with the company.
(2) Develop high-end products, dilute standard products, and increase product gold content. A good product can win the trust of customers even if the price is higher. Only by improving product quality and producing differentiated things can we survive in the market. At present, China has become a global leader in cable production, but more than 80% of high-end cables such as submarine cables, nuclear-grade cables, military cables, ultra-high-voltage cables, and railway signal cables rely on imports. If we can make breakthroughs in these areas, companies will have a lot to offer.
We are delighted to see that some cable companies have targeted the high-tech emerging fields of ships, aerospace and military, new energy (wind energy, nuclear energy), and hope to be able to navigate the unique blue ocean.
G. Industry Development
(1) Do fine work in subdivided industries. Cable companies should combine their own advantages, combined with the direction of industrial development, to produce unique products in the sub-industry, so that they will have core competitiveness.
(2) Further narrowing the regional market.
So how do we implement these coping strategies are reasonable and what are the good paths and methods?
1. Equipped with technical support personnel, establish a form management system, and improve the action plan.
2. Improve the process assessment system and quantify management of process assessment to achieve key information control.
3. Gradually weaken the dealer's technical support department and rely on the company's unified technical support.
4. Implement sales process control and establish a project operation mode in which dealers and companies are mixed.
In short, we must continue to play steadily with the advantage of local contractors or dealers in the local geographical location and human resources, so as to realize the complementary advantages of companies and distributors and the smooth transition of channels, in order to gradually weaken the local contractor (contract manager) or The personal role of the distributors, and then the company's project-based sales and process control.
Second, two marketing models for different size companies
Our IMSC Research Institute of Industrial Products Marketing has provided customers with two types of marketing strategies that are suitable for the operation of different cable companies through years of valuable experience in consulting and training customers in the cable industry. One is the contracting system, which focuses on training and digging. Grasping single masters, in order to give these salespersons ample sales performance, using personal contracting methods to motivate those who have been in the industry for years and years of sales elite - 'old bird', in order to enhance the company's overall sales performance; One is the large customer system, which mainly relies on stable teams, clear division of labor, integration of all company's superior resources, expansion of space through major customer marketing strategies, and provision of good products and back office support for these large customer companies.
Through our research and analysis of the Institute, the two marketing models are suitable for different types and sizes of companies. Because there are five major problems in the general contracting system, this system is more suitable for those enterprises with small scale, low cost of sales and production and operation, and relying on the ability of individual companies to adopt. For those companies that have a clear team division of labor, relatively stable business, relatively standardized management, and relatively easy expansion of marketing space, they should adopt a large client system. (See Figure 1) In this way, it can enable different companies to find their own development direction in marketing strategy, but also can dislocate competition, develop corresponding products in their own 'Blue Ocean', and tap for their own customers. Not for?
Third, how to implement the contract system to large customer system 'transformation'
When we provided consulting and research for companies, we discovered that some cable companies engaged in contracting systems also tracked large customers. However, with the continuous increase in marketing costs caused by the development of new projects or tracking of new customers, it caused the “oldâ€. Birds' reluctance to use their own pockets to maintain large customer relationships hinders the development of the company. Therefore, we must find some effective methods to better encourage these 'old birds' to grab large orders for enterprises. As for some enterprises whose scale has grown from small to strong, they must also undergo a sales transformation and gradually shift their marketing focus to the large customer system.
So what exactly does our cable company do? The following are the six countermeasures we listed from the perspectives of project information, project management, human resources, brand promotion, corporate culture, company development, and industry development. We hope to inspire and think about the marketing transformation of cable companies.
A. Project Information
(1) Encourage the original contract manager or regional manager to focus on attacking major customers, and the company will provide corresponding supporting policies. In general, one of the big reasons why contract managers are unwilling to attack large customers is that they are afraid that the marketing investment will be too large and the money that is thrown away will not be returned. At this time, our cable companies should introduce more preferential incentives and provide effective assistance in the negative aspects of marketing expenses, so that contract managers will have no financial worries when developing large customers. According to the practice of sharing the sales expenses between the head office and the contracting manager, we can usually award the maximum amount of commission based on the proportion of the sales expenses incurred by the parties in the contract and the actual expenditure after the contracted transaction, payment and delivery.
(2) The establishment of a large customer department to assign special personnel to collect provincial (city) level key project information. In many cases, due to the fact that contract managers are busy with busy business all day and resources are limited, information screens are blocked, and information of large customers and large projects cannot be grasped in a timely manner. By specializing in a large customer department, it can effectively and systematically collect important information in all aspects, and it can effectively avoid the risk that key customers are only in the hands of a few people.
(3) Implement a project reporting system and establish standardized customer information information. The advantage of establishing a project filing system is that it can firmly control the initiative and control of the project at the company level and effectively avoid certain risks. General cable enterprises can formulate corresponding project filing systems according to their own market capacity and sales. For example, large orders above 5 million yuan must be filed in detail, and some small-value orders can be flexibly delegated to ordinary sales personnel.
(4) Manage newcomers with standardized processes. There is no rule and no circle. New employees must organize learning and training as soon as they enter the company, instill scientific and systematic processes into them, and let them use an institutionalized process to process each sales list. With the corresponding guarantee.
B. Project Management
(1) The senior management of the company pays a return visit to key customers. In general, key customers are old customers who purchase or use their products many times and receive services. These customers are loyal to the company's products. A high-level visit to these key customers will allow these companies or individuals to feel that the company respects them and lays a foundation for further cooperation in the future.
(2) The customer service department is listed separately and directly controlled by the head office. Today, many well-known companies have established separate customer service departments with the goal of understanding more directly the problems encountered by customers and better serving customers. It is better for the sales staff to face the customer directly than for the customer service department to solve the actual problem in a uniform and standard manner. It is also beneficial to thank the customer.
(3) Turn the contracting manager into a project manager, equip it with a corresponding project team (sales support, business support, technical support, etc.) and turn the original personal assessment into a team assessment. Enterprises can appropriately allocate technical and sales support personnel to the contract manager. This can weaken the individual ability of the “old bird†through the strength of the team, make it feel that the company has not owned him and operate normally, but if they participate in teamwork, they can work together. More handy, the value of the harvest is even greater.
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