Deep Sound Original · The author | Li Jinglin
Recently, Stone Technology and Coworth, which are known as "sweeping mao", have released 2021 performance reports. Although the two have different entry times and different strategic ideas, they have achieved good results in the past year.
Founded for more than 20 years, Cobos has an operating income of 13.086 billion yuan in 2021, an increase of 80.9% year-on-year, and a net profit attributable to shareholders of listed companies of 2.01 billion yuan, an increase of 213.51% year-on-year. The growth rate of young stone technology is slightly worse, with revenue reaching 5.837 billion yuan, an increase of nearly 29% year-on-year, and net profit reaching 1.402 billion yuan, an increase of 2.4% year-on-year.
The performance of the two reveals the broad prospects of the smart cleaning track. In addition to Cobos and Stone, this track is surging, last October, Chao Mi got 3.6 billion yuan of C round financing, becoming the largest single financing in the field of smart cleaning home appliances in 2021, and at the beginning of this year, another smart cleaning brand Chasing Light announced a 100 million yuan A round of financing supported by Tencent and Sequoia.
After the wave, the front wave is chasing after me, the momentum is fierce, and they are constantly expanding their territory in the smart cleaning track, which also makes the prosperous market come to a new crossroads.
In the early stage of 1.0, domestic enterprises in this field are often the "vassals" of international big names, carrying out primary OEM production and simple imitation; with the completion of the supply chain system and the expansion of market scale, the forerunners have entered the 2.0 stage dominated by the development of independent brands; to the present, the increasingly harsh competitive environment and the growing intelligent demand of consumers have driven enterprises to take another step forward and enter the technology pioneer 3.0 era dominated by science and technology and innovation.
FOUNDRY started
Founded in 1998, Coworth has completely experienced every step of China's intelligent cleaning track.
The predecessor of Coworth is Suzhou Taiyikai Electric Appliance Company, which is mainly engaged in vacuum cleaner foundry business. At that time, the vacuum cleaner market had been monopolized by overseas big names. And Taiyikai Electric Appliances, at that time, was the foundry of Philips, Panasonic and other brands.
After several years of OEM work, Qian Dongqi, the owner of Taiyikai Electrical Appliances, realized that a single and low-tech labor-intensive work will eventually be eliminated, always rooted in the field of vacuum cleaners, whether from the product or enterprise development level, the ceiling is obvious. In 2006, he single-handedly founded the independent sweeping robot brand Coworth. One hand is a big-name vacuum cleaner OEM, the other hand is an autonomous sweeping robot, Coworth opened a two-legged walking business model, and then it is more focused on its own brand, the financial report shows that its main smart life appliances Tianke brand to achieve sales revenue of 5.137 billion yuan, an increase of 307.97%.
Source: Coworth official website Weibo
Also starting with vacuum cleaner foundry is Lake Electric, which since its establishment in 1994 has achieved rapid development by providing foundry services such as vacuum cleaners, garden tools and micro motors to world-renowned enterprises such as Shark ( Shark ), BISSELL ( Bisheng ), Philips ( Philips ) , Bosch ( Bosch ) Electrolux ( Electrolux ) and Hitachi ( Hitachi ) . Until the establishment of its own brand in 2009, the ODM export business of vacuum cleaners has been the main business of Lake Electric.
However, the road of Lake Electric's own brand is not as smooth as Coworth. In the period of ambitious conception of the development of its own brands in 2017-2018, Lectra Electric is catching up with the intensification of competition in the smart cleaning market, especially the success of the Xiaomi model, leaving less space for Lectra. Just two years later, after the termination of the convertible bond issuance, Lake returned to the old path of ODM to do manufacturing production.
In the early stage of the industry, OEM is a shortcut, but if you look at the long term, the OEM model is a double-edged sword. The good side is naturally that the immature side of the industry can accumulate technical capabilities and supply chain strength by performing OEM production for the giants, which can be described as a method of standing on the shoulders of giants and quickly realizing from 0-1.
In the long run, the autonomy and independence of enterprises engaged in OEM production are restricted, and the fate is often in the hands of front-end big brands. In 2021, after OFILM, which provides touch modules and optical products for Apple, was kicked out of the Apple chain, the market value evaporated by 20 billion. The threshold of OEM production is relatively low, the irreplaceability of the enterprise is smaller, and once the tree backed by is lost, the survival of the FOUNDRY enterprise will be worrying.
Such a phenomenon is extremely common in the manufacturing industry, whether it is a mobile phone or an automotive industry chain, the brand is the most core competitiveness. The foundry that makes wedding dresses for the brand is often thankless. As we all know, Apple's supply chain is all over the world, of which the proportion of Chinese mainland manufacturers in the supply chain of the Top200 in 2020 is as high as 48%. However, from the perspective of profits, Chinese manufacturers can only stand at the bottom of the pyramid, chip manufacturers such as Intel and Qualcomm, their gross profit margins can reach up to 65%, while the famous Foxconn, the gross profit margin is only 8.4%. The oem model is good or bad, and the judgment is made.
The value of "autonomy"
The reality of the market is in front of us, if enterprises want to achieve further development and drive themselves from OEM to independent brands, it is a must-do thing.
Stone technology has risen in this context.
In 2016, the first product of Stone Technology was also a Mijia sweeping robot OEM for Xiaomi. Relying on the Xiaomi ecological chain, the stone quickly opened the market. At that time, international giants such as IRobot, Dyson, domestic leaders such as Coworth occupied the high-end market, and Stone Technology seized market share with LDS laser + SLAM technology and lower pricing. The strategy of expanding sales with low prices and low allocations is similar to that of the early millet.
However, as mentioned earlier, the OEM model is bound to lead to insufficient bargaining power in the market, in 2017, Stone Technology opened its own brand operation and took a step of "de-milletization". The pain is also inevitable, losing the sales of the "Mijia custom brand" products with large sales volumes, and the revenue growth of Stone Technology in 2020, which is the rapid development of the sweeping robot industry, is only 7.74%, far behind the industry's 19.1% growth rate.
Last year, stone technology "de-millet" effect is remarkable, the proportion of private brand product sales has risen from 65.73% in 2019 to 98.23%, basically no longer responsible for the production of millet brand equipment. Separating from Xiaomi has also allowed Stone Technology's sales of independent products with better gross profit margins to increase.
Stuck on the node, choose the right road, Stone Technology jumped into the "crazy stone", in December 2020 Stone Technology stock price exceeded 1,000 yuan, becoming the second enterprise in China's A-share market with a stock price of more than 1,000 yuan, second only to Guizhou Moutai. According to the recently released financial report, Stone Technology sold a total of 2.8199 million sweeping robots last year, an increase of 18% year-on-year, of which the company's own brand revenue was 5.767 billion yuan, accounting for 98.80% of the high, an increase of 40.77% year-on-year. It can be said that Stone Technology has successfully completed the upgrade from OEM to its own brand.
From autonomy to self-improvement
Competition has led to prosperity, but it has also meant that the industry is gradually becoming a buyer's market – the voting power is completely in the hands of consumers. Left-handed "technology" and right-hand "brand" are the requirements of consumers for a new generation of smart cleaning companies.
First of all, the compound interest on the product brought by the core technology is undoubtedly the story that enterprises want to tell under the trend of China's intelligent manufacturing. Especially in the field of technology consumption, whether it is the former wave Coworth or the back wave stone, they are constantly balancing R&D investment to expand their competitive strength. According to the financial report, in 2021, Stone Technology invested 441 million yuan in research and development, an increase of 67.74% year-on-year, accounting for 7.55% of revenue; Coworth's R & D investment also maintained a steady growth, reaching 549 million yuan in 2021, an increase of 62.45% year-on-year.
The game-breaker pursuit is a "R & D maniac" - according to the data, by the end of 2021, the company's R & D investment accounted for 10% of revenue, almost 1-3 times that of the same industry. As of March 2022, Tracing Technology has applied for 2,262 patents worldwide, including 775 invention patent applications, 142 PCT applications, and 1,194 authorized patents. At present, the pursuit of product matrix by sweeping robots, scrubbers, vacuum cleaners and hair dryers four categories, from the perspective of revenue growth rate, in 2019, the pursuit of revenue exceeded 500 million, by 2020 this data will soar to 2 billion as much, in 2021, the pursuit of only half a year to achieve a level close to the whole of 2020, an increase of more than 100%.
The beginning of the story is similar to Dyson's path, also from the high-speed digital motor, when the high-speed digital motor is still a "card neck" technology, and the pursuit took three years to break through successfully. In the second stage, The Pursuit developed a "moon landing plan" to increase the speed from 100,000 revolutions to 150,000 revolutions, or even 200,000 revolutions. As of now, dyson's latest V15 series products are equipped with digital motors with a speed of 125,000 rpm, while the high-speed motors that can currently mass-produce 160,000 rpm and reserve motors reach 200,000 rpm.
In 2020, the technology research and development of the pursuit officially entered the third stage, focusing on the generalized robot, developing its "heart" and "brain", of which the "heart" is represented by a high-speed motor to provide a power source; and the "brain" is the new story of the pursuit - based on visual environmental perception, positioning, decision-making and control. "With the heart and brain as the underlying technical support, the pursuit can continuously expand more application scenarios."
A new generation of smart cleaning home appliance companies led by the pursuit of technology rather than labor costs to obtain profits, helping enterprises to establish advantages and moats in the fierce industry competition, is undoubtedly a microcosm of China's manufacturing upgrading. But at the same time, in the macro context of consumption classification and consumption globalization, "going out" and "doing brands" are also two mountains on the shoulders of enterprises.
Still taking the pursuit as an example, this unicorn company, founded in 2017, has played two cards at home and abroad at the same time since its inception. The first stage is to cooperate with distributors to break the situation; the second stage is to start cooperating with foreign local channels to build its own market; the third stage is to find a benchmark market to differentiate.
In 2021, the sales of overseas cleaning categories accounted for 70% of the total sales, and in only three years, it won the same price in the e-commerce markets of many European and American countries, the first place in the best-seller list or the first place in the market share of similar products.
The competition in the market is never stopping, especially in the technology and manufacturing industries, only continuous innovation and improvement of technical capabilities can provide perfect solutions for the increasing living needs of consumers. From imitation to self-reliance to self-improvement, this is the road that China's manufacturing industry has traveled for many years, and it is also the inevitable journey of the intelligent cleaning track.