Chapter 21 Insufficient Production Capacity
Chapter 21 Insufficient Production Capacity
Xu Shenxue knew very well that, let alone now, even if online sales were already popular in the future, offline channels would still be a battleground for mobile phone manufacturers.
In later generations, everyone had a smartphone and online shopping was extremely large in scale. Even so, offline channels still had strong vitality and gave birth to two large domestic mobile phone brands, namely the brother brands VO and OP.
Because you can't expect everyone to buy their phones online. There will always be a considerable number of people, even young people, who buy their phones offline.
Therefore, while doing a good job in online e-commerce channels, Xu Shenxue has never given up the idea of offline channels.
The best choice is to combine online and offline!
Therefore, at present, Weiku Electronics Co., Ltd. has formed a structure with two self-owned brands, namely Xiaolan online and Weiku offline.
However, the offline channels of Wecoo Electronics are actually somewhat distorted. That is, the shipments are heavily dependent on various mobile phone channel dealers in Huaqiangnan, which are what Wecoo Electronics calls first-tier channel dealers.
However, these mobile phone distributors in Huaqiangnan will not really go to other places to open up markets, but directly wholesale the goods to various small mobile phone wholesalers from other places to make a profit from the price difference...
Of course, they are able to sell these low-end mobile phones to various mobile phone wholesalers from other places, which shows their ability and they deserve to make money.
However, for mobile phone manufacturers such as Weiku Electronics, this means that there is one or even two unnecessary channel levels between manufacturers and end consumers.
It not only means that the profits are divided among these large channel dealers, but also means that there is a relatively large price difference between the ex-factory price and the terminal selling price, resulting in excessively high prices at the terminal and a lack of price competitiveness.
The latter is more important.
So Xu Shenxue thought about it and said, "We still have to continue to expand offline channels. In addition, we should not limit our sights to Huaqiang South, but go out boldly and establish our own first-level or even second-level channels in other places!"
“Channels are the neck of the enterprise, and we cannot let others strangle us!”
Xu Shenxue put down the report and said, "But we must also be cautious and not attract the attention of existing channel dealers. At this stage, we should not go to areas covered by existing channel dealers, but go to areas that are not covered by existing channel dealers to establish our own channels!"
“Establishing our own channels is difficult, but we have to do it even if it is difficult. We can’t not do it just because it is difficult, otherwise there will be no room for maneuver if something goes wrong in the future!”
Bai Qiwen also nodded and said: "Establishing our own channels is something I have always wanted to promote. It was not possible before due to various problems. Now it seems that the time is ripe!"
"Especially after the high-frequency mobile phone strategy in November and December, we have launched more than ten new models of V-Cool mobile phones. Together with the original more than 20 models, V-Cool mobile phones now have about 40 models on sale."
"Although our V-Cool phone models are relatively few compared to those of big brands, they are still able to support our channel system. After all, many small street phone stores are small in scale. Even if we run our brand's exclusive store model, these dozens of phones are enough."
"Moreover, most mobile phone stores do not adopt the model of exclusive stores, but sell multiple brands at the same time. They buy whatever sells well. In this case, we also have many models for them to choose from!"
"And our V-Cool 320 has great potential. Having such a popular model leading the charge will be very helpful for us to establish our own channels!"
Xu Shenxue said: "Well, prepare the relevant personnel to do it. I won't put too much pressure on you. Set up the framework within a month and find out the channel situation!"
After Bai Qiwen left, Xu Shenxue looked up the latest sales statistics for various offline channels, but such statistics were not very meaningful because there were no regional sales statistics at all.
As a manufacturer, Weiku Electronics doesn’t even know where its mobile phones are sold by those channel dealers, nor does it know which models of mobile phones are the best sellers in a certain area, and what unique needs local consumers have. As a result, it is impossible to make targeted adjustments to market sales and product research and development.
In order to better control the channels in the future and to better obtain market feedback, it is necessary to establish a proprietary or controllable provincial or even municipal channel system.
But again, building your own channel is not an easy task, it requires a lot of time, energy and cost!
You can’t just open a sales branch in a certain province and then say that the channel in that province has been established... You still have to understand the market situation in the local province, and then find a large number of qualified local mobile phone channel dealers, let them represent your mobile phones, and then you can put the goods out for consumers to see.
This process is not easy for a little-known brand of mobile phone!
When a big-brand mobile phone company says it's recruiting agents, people rush to get it...but when you ask a third-rate brand to recruit agents, it's not that easy.
Therefore, Xu Shenxue would not urge his colleagues in the marketing department to build the framework first, and then take it slow, advancing it step by step, one city at a time, one province at a time.
Anyway, the current offline channels are still okay, and online sales are also gradually expanding. The combination of the two has actually begun to approach the production capacity limit of Weiku Electronics' mobile phones.
Since January 09, the online Bluegogo mobile phones S1 and S2 have continued to sell well, and the offline Wecool 320 has also sold well. Although the sales of other offline models are small, the total sales of all models added up are not small.
In the end, the sales of the two brands have filled up the production capacity of Weiku Electronics... The marketing department stopped accepting OEM orders last month. After completing the existing OEM orders, most of the newly freed-up production capacity was used for Xiaolan mobile phones, and part of it was used for Weiku mobile phones.
But even so, production capacity has been pushed to the limit!
Insufficient production capacity has become the main problem faced by Weiku Electronics Co., Ltd. after entering the new year!
Therefore, in the company's high-level meeting after New Year's Day, everyone was filled with happy worries...
The last time everyone frowned was because the mobile phones couldn’t be sold, but this time it was because the mobile phones were selling too well and the production capacity couldn’t keep up!
Bai Qiwen, dressed in a suit, reported as usual: "Last month, that is, December, thanks to the promotion of the Bluegogo S1 and the S2 which was launched in the second half of the year, our Bluegogo mobile phone sales reached units!"
"The sales of the Weiku brand reached 320 units, driven by the mobile phone!"
"In addition, we sold 18,000 OEM mobile phones, but this part of the business has been stopped. All orders have been completed and delivered to customers. We are not accepting new OEM orders for the time being. This part of the production capacity has been switched to supplying our own brand mobile phones at the end of the month."
"Combining the above three parts, we sold a total of 70,000 mobile phones, once again breaking our company's monthly sales record!"
"However, due to limited production capacity, our marketing department had to let channel dealers queue up to get the goods starting this month. But you should know that we are in Huaqiang South Market, and the market changes very quickly. Channel dealers will not foolishly wait for us to queue up for production before getting the goods. Instead, they will turn around and look for other manufacturers to get the goods!"
"There are already a small number of competing products on the market that are highly imitative of our Vicoo 320 mobile phone. Our flagship product, the 320 mobile phone, in offline channels has begun to face competition from homogeneous products!"
"Given that our own production capacity is currently insufficient and we cannot quickly expand large-scale production lines in a short period of time, I suggest looking for OEM!"
"If we hire a foundry, even if we have to pay a certain amount of OEM costs, we can still make a lot of money overall. The most important thing is that we can maintain the confidence of channel dealers and prevent them from switching to other companies!"
"We can't just sit there and watch our distributors become distributors for other companies, and then compete with us..."
After hearing this, Xu Shenxue said: "OEM is a good option. The marketing department has started to promote it and look for feasible partners!"
There are numerous small and medium-sized mobile phone factories built around the super market of Huaqiangnan, many of which can do OEM... Weiku Electronics was one of them before.
As long as you have an order, you don’t have to worry about not being able to find a OEM.
(End of this chapter)