In 2003, it was the fourth year of continuous rapid growth of China's instant noodle industry. From the industrial structure at that time, Master Kong, who was in the front of the industry, had a turnover of more than 6 billion. The second echelon Hualong and Baixiang were in the same year. The turnover is also more than 2 billion, and the turnover of the third-tier instant noodle companies in the year is mostly between 200 and 300 million. And the concentration of the industry is getting higher and higher, and the monopoly position of the industry is gradually taking shape. In January of this year, China’s grain and oil prices showed an unprecedented wave of price hikes. At that time, instant noodles companies’ raw materials such as flour, palm oil and packaging materials all rose more than 30%. This sudden increase in prices almost directly consumed enterprises. The total gross profit makes the instant noodle enterprises in the mature stage of the industry fall into a great business vortex, and the enterprise faces the choice of life and death.
At the time, the author worked for a instant noodle company. The company is a regional brand in the third echelon of the industry. The annual turnover is nearly 200 million yuan. In comparison, the company has no other advantages. Faced with such a situation, the company continually holds high-level Conference research countermeasures:
Firstly, it analyzes the environment faced by industries and enterprises. It is proposed that in this abrupt environment, enterprises must re-examine the annual business strategy and annual planning and make corresponding adjustments. Otherwise, the price increase of raw materials will lead to short-term capital chain losses due to corporate losses. Business operations must be fully passive;
Under this premise, the top management of the company agreed that it is necessary to quickly and comprehensively adjust the business plan of the company, temporarily abandon the annual business plan under the annual strategy, and re-plan and quickly adjust from the perspective of product, price, and promotion.
The second is to implement specific adjustment measures and work. On this issue, there has been a big disagreement among the company's top management. The executives of the enterprise management layer believe that the company should implement a comprehensive contraction plan based on the premise of ensuring profit targets, fully implement product price increases, reduce promotion expenses, and reduce sales teams. Abandoning the barriers to the far-off market;
The executives of the corporate marketing layer believe that under the premise of ensuring the normal operation of the enterprise, it is necessary to have a positive and negative income, and to maintain the pressure on the premise of ensuring that the enterprise does not lose money. And resolutely oppose the one-size-fits-all contraction policy, and believe that the overall contraction can only solve the difficulties of the enterprise reality. When the whole industry realizes the crossing, it is its own passive day. Such measures will be exchanged for temporary benefits at the expense of the future of the enterprise. This approach lacks a strategy that allows companies to own today and lose tomorrow.
In view of the high-level view of the marketing, the senior management of the company believes that it is difficult to resolve the pressure of raw material growth, and that the company will still lose money and cannot solve the problem. In this kind of environment, with the atmosphere of the overall industry, only one step can solve the fundamental problem in the environment of rising waters. Otherwise, when the whole enterprise realizes the transition, when the atmosphere of this adjustment disappears, we have not fundamentally To solve the problem, we will fall into a very passive situation. In this context, it is inevitable for enterprises to be at the forefront, and the special period must be worthwhile and not both. In view of the financial strength of enterprises, they believe that ensuring corporate profits or immediately turning losses is a top priority. In response to the view that the marketing executives moderately protect the enterprise's key insurance market, the executives counterattacked that the enterprise is Qingshan, the market is firewood, and the Qingshan Mountain is not afraid of burning wood.
The marketing executives have once again put forward their own views and measures. From the perspective of the market, our company is in a weak position, has no brand advantage, and does not have the ability to bargain with consumers. Simple price increases will inevitably lose a large market share, no market. The advantage of status, the right to speak in the market is in the competition. If the market support is cut off in a simple and one-size-fits-all manner, the weak market will be directly lost, and the hard-built base market will be lost. Self-protection will definitely lose the status of the industry, and will also lose the strategic plan for the company to break through, because the instant noodle industry has not left much time for the third echelon companies to break through. Without the support of scale and market position, it is difficult for enterprises to change their own destiny. We are convinced that the price trend is not only this time, nor will it be sustained. China's price level is a stepped spiral. In view of the above situation, our marketing executives believe that in a specific environment, for the small and medium-sized instant noodles enterprises of the third echelon, it is necessary to have a resettlement strategy with a guarantee and a pressure.
After several rounds of fierce battles, the high-level meeting decided to follow the marketing high-level plan, but also proposed that the company's senior management participate in the target management and control of the normal operation of the company, otherwise it will retain the possibility of stopping.
In response to the company's goals, we carefully analyzed the difficulties faced by capital turnover and market input, and adopted the following measures:
The first is a strategic price adjustment for the product. Under the premise of carefully analyzing the gross profit of a single product, the company's products are classified into: a quantity of favorable products, a quantity of unprofitable products, a quantity of unprofitable products and a quantity of beneficial products. The strategy of guaranteeing the cost of a product with favorable quantity is to make a sub-market sales plan, to achieve a certain number of pieces to maintain the original price, up to 0.3 yuan per piece in the case of failing to meet the required sales volume; The collocation strategy of limited sales, that is, the proportional delivery of such products, refuses to market the products separately for such products, and only allows the sale of products with gross profit, otherwise it will accept the price increase of 0.8 yuan/carton. Provisions, and quickly re-established prices after the implementation of such products, further implemented the sales measures of the old and new, to avoid the phenomenon of "intestinal infarction" of direct price increase; the elimination of infinite and unprofitable products within a limited time; The market support for infinitely beneficial products has been increased. Under the premise of measuring gross profit, the market support for some infinitely beneficial products has been increased. This contradictory measures have stimulated the confidence of dealers.
These strategic measures are introduced. Compared with the similar price increase of most similar products, most of the products have a direct daily limit. Under the premise of combining their own actual conditions, we respect the market reality and form a product promotion and operation strategy for the company's special period.
The second is to promote product upgrades and improve product structure. We are soberly aware that only the system to promote product upgrades is the fundamental way out for enterprises. In 2003, the price of mainstream products for instant noodles was 0.5 yuan/bag, 0.7-0.8 yuan/bag, while the product of 1 yuan/pack was still in the cultivation stage. The enterprises of the third echelon did not dare to make such products. In the case, we proposed the proportion of compressed low-end 0.5 yuan / package products, stable mid-range 0.7-0.8 yuan / package products, and cultivated and expanded the proportion of 1 yuan / package products.
At that time, all enterprises were implementing product upgrades, and most of the implementation of enterprise product upgrades was very clear, that is, to improve corporate profitability. They used to use 1 yuan noodles/package products as fast-growing products, only through There are basically no strategic promotion measures to sell to make money. However, we adopted the strategy of “products to raise products†for the 1 yuan surface, and bundled the promotion expenses of the product with the unprofitable products, and achieved the control goal of market stability and cost through driving.
The third is the comprehensive cost control strategy based on the cost-effectiveness ratio. In a special period, a better money-making strategy to save money, we implement dynamic process management measures for expenses, establish a bill of lading review system from the marketing management system, and plan the market for goods from the variety structure, vehicle size, distance, The labor cost will be reviewed on a vehicle-by-car basis. Any invoice that does not meet the cost-effectiveness principle will directly instruct the market responsible person to re-report; from the perspective of market support, under the “market Yangyang market†strategy, the market will be classified. The method of compressing the conventional expenses of mature markets and weak markets, avoiding the past market support for egalitarianism, focusing on growth markets, and increasing market input in most growth markets in order to quickly achieve market position and reduce maintenance costs of market operations. Coordination of capital turnover and cost control from the production, supply and marketing system, bulk purchase of large-volume products, mass production in large quantities, and linkage control with suppliers to achieve cost control.
After several rounds of arduous work, under the premise of realizing the company's overall requirements, the company achieved a successful transition and walked out of the swamp.
There is a saying in the West that the millennium can be seen back. Every few years, every experience of that experience will have a different taste in mind:
The company where the company was located is still in the third echelon of the industry. There is no essential change in the status of the industry and the status of the market. If it can focus on the construction of the regional market at that time, based on the strategy of creating a base market, it can successfully create a local part. Strategic regional market, and successfully upgrade products in these markets, continue to build the company's reputation products, build a reputation for the company's overall products through reputation products, and realize the threshold of competition, so that I can be the master of my site. It will also leave room for the company to develop in the next few years.
In a certain sense, the strategy of the enterprise is a choice between giving and living. We have adopted a strategy of putting money in place and maintaining pressure. Compared with the third-tier team, similar enterprises have also revealed the true character of "hero". However, compared with the challenger of the industry, Smet's contrarian, it is still the difference in the essence of strategy. The precipitation of the years makes us understand that when any enterprise problem occurs (such as price increases, inflation), there are usually two very different modes of thinking. One is that the problem occurs, and the enterprise is even harder. The other is Everyone is hard, I may be easier. The difference between the two different kinds of thinking is that the object of thinking is different. The former thinks about problems, while the latter thinks about opportunities.
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