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Wen 丨 milk
Editor丨Kepler is out of power
Pork is a necessity for the common people, and there are many people in China who have made their fortunes by raising pigs, among which the number of famous is the Makihara Group, the founder of which started from scratch and made the pig breeding business the top in the country.
However, now the "100 billion pig king" Makihara Group is heavily indebted, with a debt ratio of 6.5 times, and another hidden danger of a local state-owned enterprise has been dug up.
Will this star company become another "Xiao Xu Jiayin"?
Make a fortune
Qin Yinglin was born in an ordinary rural family, and when he was a child, he did not study well, and he was the last in the class all year round.
People in the village said that Qin Yinglin was "the master who can't read", and advised him to go home early to help farm or do some rough work, but his parents did not give up this unlearned son and insisted that he finish high school.
After graduating from high school, Qin Yinglin finally had his own dream, he wanted to start a business and get rich, when the spring breeze of China's reform and opening up in the 80s of the 20th century was blowing, the private economy was booming, and many people were trying various ways to start a business to get rich.
Qin Yinglin was also infected by this boom and had the idea of starting his own business, and his entrepreneurial idea was simple and simple: he wanted to raise his own pigs and start his own business.
At that time, China was in a period of rapid economic growth, the income level of residents was generally increasing, and the demand for pork consumption surged.
He noticed a newspaper news about making a fortune by raising pigs, and was inspired by the summer vacation of high school, so he proposed to his father the idea of raising pigs and asked for some start-up funds.
The father expressed his satisfaction and support for his son's entrepreneurial enthusiasm, and took out some money from his savings as Qin Yinglin's entrepreneurial fund.
After obtaining the start-up capital, Qin Yinglin started his own entrepreneurial road full of excitement and anticipation.
He used his start-up fund to buy back a few piglets and happily started farming, but soon discovered that starting a business was not as simple as he thought.
He had no knowledge and experience in pig farming, pig raising relied on trial and error, inefficiency, and more seriously, at that time, swine fever was epidemic, and the piglets he bought quickly contracted and died.
The first venture ended in failure, Qin Yinglin understood that if you want to succeed, you cannot rely on passion, you must systematically learn professional knowledge, after the college entrance examination, he chose Henan Agricultural University to major in animal husbandry and breeding, and studied the theoretical knowledge of breeding assiduously.
After graduating from university, he worked in a local state-owned meat processing enterprise, accumulated valuable farming experience, and in 1992 Qin Yinglin began to start a new business.
Qin Yinglin used the savings saved during his work to launch his own pig breeding plan again, this time instead of repeating the mistakes of the past, he developed a detailed feasibility analysis plan, studying the characteristics of different pig breeds and disease prevention and control measures.
With a solid theoretical foundation and rich practical experience, his pig farm soon developed from 22 pigs at the beginning to the scale of 1,000 pigs, and was initially on the right track and established the Makihara Group.
After years of exploration, Qin Yinglin realized that relying solely on breeding alone cannot increase income in the long term stable profit, because there are obvious cyclical fluctuations in pig prices.
So he began to expand the industrial chain, began to study slaughtering, processing and sales channels, and Qin Yinglin's career entered a period of rapid development.
After years of hard work, Makihara Group gained a leading position in the industry, and later, with the successful listing of Makihara Group, the company's valuation surpassed that of the old enterprises in the same industry, and it became the largest private nutrition pig enterprise in China.
Qin Yinglin personally also entered the top 15 of the Hurun Report.
Qin Yinglin's entrepreneurial journey is magnificent, from initial failure to final success, embodying his years of hard work, achieving the legendary development of Makihara Group from a small pig farm to an industry giant, allowing ordinary farmers to realize the transformation dream of rural tycoons.
But the sky is not as expected, so difficult to get to this point there are still problems.
"100 billion" or "100 million"
Qin Yinglin was slowly labeled as the "100 billion pig king", the company is getting better and better, the projects are doing more and more, and even developing a lot of new projects.
However, in recent years, under the dual pressure of the epidemic and expansion, the company is facing unprecedented difficulties.
According to the financial report, Makihara Group's accumulated liabilities are as high as hundreds of billions of yuan, and the debt ratio is as high as 6 times, which makes investors worry about its ability to repay.
During the epidemic, Makihara boss Qin Yinglin was expanding wildly, with a project investment of up to billions of yuan, and there are still billions of yuan of projects under construction, which shows that almost all of the funds have been invested and constructed.
Even more worrying is the collapse of Makihara's share price, which also confirms that Makihara Group has begun to decline, and the stock price has fallen more than a record low this year.
It can be seen in the financial report that the profit margin of Makihara Group in the first half of this year fell significantly, profitability was affected, and under the pressure of high debt, Makihara's profitability also declined.
Qin Yinglin's personal wealth is also at great risk, as the company's controlling shareholder, most of his wealth is tied to the company's stock price, and it faces shrinkage under the collapse of the stock price.
But then again, the pig industry itself is a very cyclical industry, with the development of time, pork prices have experienced multiple price cycles, each cycle up, down, bottom, many farmers have collapsed when the price fluctuates.
Makihara Group is not immune, but this time the downward cycle is too long, which makes its losses particularly serious, in fact, other companies have also experienced a decline in performance in this wave of industry troughs.
But these companies are still somewhat different from Makihara, they raise pigs at the same time as chickens, ducks, geese and other industrial development, can diversify business risks, while Makihara's business is concentrated on pigs, once pig prices fall, losses far exceed peers.
And when pig prices rose sharply during the epidemic, Makihara boss expanded too fast, the project investment was huge, and once the market changed, it was difficult to sustain.
It can be said that the deep cause of Makihara's predicament is not only related to the industry cycle, but also related to the company's own improper business strategy, so what measures will Qin Yinglin take to save this enterprise that is about to collapse?
The road to self-help is long
As the largest pig breeding enterprise in mainland China, Makihara Group has faced the severe situation of continuous downturn in the industry in recent years, and the company's performance has suffered significant losses and liabilities of up to 100 billion yuan.
The reform of the contracting system implemented within the company, allowing employees to bear part of the breeding risks themselves, although there are advantages and disadvantages, but on the whole, it stimulates the enthusiasm of employees.
Although the new energy business has great potential, but the competition is strong, Makihara can not be qualified is not clear, relying on the "pig cycle" effect to turn losses into profits, now it is not very reliable, in the face of internal and external troubles, Makihara is at a key node to carry forward the past and the future.
Makihara's predicament is inseparable from its standardized large-scale farming model, which has large investment and high risk, and is more prone to losses when the industry is down.
However, once the market improves, its prospects are broader, and giving full play to the advantages of standardized breeding is still the way out for Makihara.
As the days went by, pork prices fluctuated disorderly, due to complex high costs, reduced the profitability of farming, market prices could not form a stable cycle, and Makihara Group relied too much on the regular profits brought by the "pig cycle", and this model began to crack.
In the face of changes in the market environment, Makihara Group may adjust its business strategy in time, and should appropriately slow down the pace of expansion in terms of production capacity, optimize the allocation of existing resources, and reduce the risk of excess capacity.
In addition, Makihara has controlled costs to further improve operational efficiency, reduce waste and unnecessary expenses in all links, expand the proportion of direct sales in sales channels, and maintain cooperation with important agents to ensure the market share of products.
The above series of operations is equivalent to spreading the risk downward, first saving money from the root, and then increasing the return of funds through sales.
At the same time, Makihara also carried out employee training and improved employee professional quality education to ensure the smooth implementation of the reform, improve the performance appraisal system, and prevent individual employees from taking illegal actions to strive for performance.
In fact, Makihara Group can also appropriately expand its business scope, on the basis of consolidating the main business of breeding, cautiously explore emerging fields, develop in various aspects, and disperse the pressure brought by pig farming.
Makihara needs to choose subdivisions with its own advantages for layout, and at the same time find partners with resource endowments to reduce the risk of going it alone.
Now that new media is also developing at a rapid pace, Makihara can actively explore new profit growth points such as agricultural technology and e-commerce retail in this direction, so that the overall strength of the enterprise will be further enhanced.
In the face of the grim situation, Makihara may need to temporarily shrink the front, adjust the pace, consolidate the foundation, and when the time is ripe, then go all out, march to a new peak, and open up the situation with wisdom and resilience, Makihara will be able to regain its brilliance and become an industry leader again.
Makihara's future is uncertain, we wait and see, it is common for companies to face various difficulties, and the key is how to resolve difficulties and innovate.
Whether Makihara can successfully transform and whether there is still a hidden crisis requires the test of time, we should not make conclusions, but continue to observe, give enterprises enough time to prove themselves, history will always give the answer, what we have to do is to wait patiently.
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