Chapter 9 The Factory Crisis and Chen Chen's Opinions
After hearing Li Zhi's words, Chen Chen asked curiously: "What the hell is going on?"
"That's how it is..." Li Zhi was about to continue.
"Shut up! Li Zhi, you are crazy! Are you going to rebel?" Chen Jiansheng turned his head suddenly to Li Zhi.
"No! I'm not crazy!" Li Zhi waved his hand vigorously, "Chairman wants to make his own mobile phone."
"Oh..." Chen Chen nodded indifferently, "Then do it!"
Li Zhi was stunned.
Chen Jiansheng laughed and turned to Li Zhi: "What else do you have to say now? Chen Chen supports me now!"
"No! Chenchen, you don't understand." Li Zhi leaned forward slightly. "Our group's OEM factory, the largest customer, Apple, has reached a cooperation agreement with Foxconn, and the Apple phone will be handed over to Foxconn for OEM next year."
Li Zhi used a very fast speaking speed to introduce the current situation to Chen Chen and Chen Ying.
Chen Ying was a little confused when she heard this, but Chen Chen had the experience of the previous life, but suddenly understood: "So that's what it is..."
One of the important enterprises under the name of Chen Jiansheng Group, Yongheng Electronics, is an electronic product OEM factory.
Eternal Electronics is the official OEM factory of Apple mobile phones in this world, which has also led to more than half of the orders in this OEM factory are provided by Apple and related products.
After Apple cancels its order, the number of orders will be reduced by more than half next year. In this way, a large number of production lines of OEM will inevitably be suspended, which will inevitably lead to losses.
Temporary losses are small matters. The key is that this OEM that relies on Apple's orders to survive. If it cannot find partners of the same level as Apple in the next one or two years, it may even go bankrupt.
In 2017, the mobile phone industry has passed the Warring States Period when big and small brands are fighting each other. In the current market, the strong will always be strong, the weak will always be weak, and small brands will no longer have a foothold.
You can hear news about brand withdrawals at any time, which corresponds to the following bankruptcy of OEMs. As a peer, Yongheng Electronics often hears news that factories in the same industry have stopped production and closed down.
Eternal, although it is huge and ranked seventh in the world, relying too much on Apple, once it loses Apple as a customer, it will be more fragile than those small factories.
Generally, the response plan in this situation is to either decisively reduce production and reduce production lines, or seek excessive low-level orders at low prices, or engage in price wars with Foxconn and use extremely low prices to pull back some of Apple's orders.
Generally, a safe way is to combine three operations. With the financial resources of the group company, although it cannot guarantee when profits can be restored in the future, it should be able to survive.
Now Chen Jiansheng doesn’t know which string is wrong, he wants to build his own brand.
It was 2017, not 2012. The mobile phone brand merger was at its end, and there were only a few big brands left. At this time, jumping in was completely a verdict to die.
Moreover, there is no advantage in building a brand in OEM, but rather a disadvantage.
Many ordinary people may not understand that as an OEM factory, they have their own production capacity. Top factories like Yongcheng also have design and development capabilities, but why do they have to be OEM for others? Why don’t they make their own mobile phones to sell?
The main reasons are two points. First, it is that it is like a mountain in a different way. It is capable of technology, but it may not be able to do brand marketing, hardware production, but it may not be able to do software development and system optimization.
They have no experience in market research, advertising, after-sales processing and related talent reserves.
From market research, styling design, technical research and development, upstream chip manufacturers' production scheduling, advertising promotion, sales and after-sales outlet laying, etc., it is completely clear! We must start from scratch!
Therefore, there is no difference between building a brand in OEM and opening a new company and creating a brand.
However, relatively speaking, this is not the most important reason. The second point is competition among peers.
As an OEM factory, if you build a brand, it is equivalent to competing with your own customers.
Originally, brand manufacturers handed over the designed solutions to OEM factories, but now OEM factories sell similar products themselves. No one can guarantee that OEM will not steal their designs and make their brands.
For example, if Huawei's OEM factory gets the drawings and plans of Huawei's latest mobile phones, slightly change the appearance, and paste it with its own brand to sell, Huawei will be a big hit.
Although you can basically win lawsuits, it is best to avoid such things if you can avoid them.
So when they know that when factories want to build independent brands, they are likely to cancel cooperation directly, cancel orders, and find more conservative OEM factories.
In this way, there will be even fewer orders that are already scarce, which is like adding fuel to the fire for eternity.
If Chen Jiansheng's own mobile phone brand cannot be successful, the factory will definitely wait for death.
In Li Zhi's view, Chen Jiansheng is seeking death, and the OEM is an old company under the group. When the market was booming, it created a lot of profits for the group and could not just give up.
Therefore, Li Zhi insisted on conservative practices, while closing some production lines, looking for new partners, contacting small and medium-sized orders, and continuing to strive for Apple's order share and strive to restore profits within three fiscal years.
Chen Jiansheng, on the other hand, was desperate to develop his own brand and intervened in the mobile phone brand market at the most inappropriate time.
Chen Jiansheng is the chairman and group president, Li Zhi is the assistant to the president, and the group vice president level. The two are old partners for many years. Chen Jiansheng has a generous personality and a big view but is prone to impulsiveness, while Li Zhi is conservative, steady and patient.
The two people's personalities are just complementary, both at work and in life. The personal relationship is also excellent. The two families are very familiar with each other. They don't need to say hello in advance when visiting each other.
After listening to Li Zhi's explanation, Chen Chen sorted out the language and asked Li Zhi: "Uncle Li, do you want my sister and I to stop my father from making mobile phones?"
"Yes!" Li Zhi ignored Chen Jiansheng's glaring eyes and nodded decisively to admit, "This time, we must stop the chairman no matter what, otherwise our factory will be finished!"
After hearing Li Zhi's words, Chen Jiansheng was dissatisfied: "Hey... I said Lao Li, you are so sure that I will definitely fail?"
Li Zhi nodded without any fright, "That's right! Now that big brands are starting to merge, small and medium-sized brands have begun to leave the market. If we jump in at this time, there will be no good results!"
Chen Jiansheng shook his head and said, "How can you know if you don't try it? We are not inferior to any mobile phone brand or factory in industrial design and production processes. If they can do it, why can't we do it?"
Li Zhi nodded and said, "Yes, yes, our industrial design and hardware production are all world-class, but what about the system? What about the software? What about the market channels? We are completely clear and have nothing!"
Speaking of this, Li Zhi paused and concluded: "In short, our mobile phone has no highlights! In this era, new mobile phone brands without any highlights will inevitably be eliminated by the market! No scum will be left behind."
Chen Jianshen frowned and said, "The project has not started yet and the plan has not yet been released. How do you know there are no highlights? Maybe it will be there when it is made!"
Li Zhi responded tit-for-tat: "What the chairman means is to rely on hope and miracles?"
"Yes! I believe in miracles!" Chen Jiansheng said, turning his head to look at Chen Chen.
Although Chen Jiansheng didn't say anything, Chen Chen's heart trembled inexplicably.
According to the information in memory, the mother suffered a car accident during childbirth. It is said that her mother had died when she arrived at the hospital. No one believed that the child could survive.
It is said that before the mother died, she grabbed Chen Jiansheng's hand and asked him to keep the child.
So Chen Jiansheng insisted on undergoing caesarean section, and then Chen Chen came to this world. Although he was sick, he survived.
From then on, Chen Jiansheng has always regarded Chen Chen as a miracle given to him by God. As long as Chen Chen insists on something, he will definitely do it.
Chapter completed!