Ten years ago, when most companies were still relying on foundry to live very well, when NVC was established, it began to control channels, build its own stores, and support dealers. After a few years, when traditional channels were “divided†NVC began to explore "invisible channels" to find out those who "have a strong influence on the buyer's purchase behavior"; and when the channel is strong enough, NVC found that the existing channel has no room for breakthrough, so there are New changes...
Three channels of change have enabled NVC to rise rapidly. According to the information provided by NVC to the newspaper, since the end of 1998, its founder and chairman Wu Changjiang has collected 1 million yuan to establish NVC. NVC sales amounted to 30 million yuan in 1999 and 200 million yuan in 2002. It is 600 million yuan in the year and nearly 4 billion yuan in 2008. In 10 years, NVC sales increased by more than 100 times, and Wei Wei, deputy dean of Peking University's HSBC Business School, pointed out that the Chinese lighting industry with a total market capacity of more than 200 billion yuan has an average annual growth rate of 20%.
NVC's high growth also attracted the attention of international capital. Softbank Safran invested US$22 million in NVC in 2006 and an additional US$10 million in 2008. At the same time, Goldman Sachs also injected $37 million into NVC.
Every step of NVC’s transformation is centered around “channelsâ€.
When others are foundry, I built the channel "channel competition will gradually dominate the consumer market." Wu Changjiang once said this, but he also walked the road of foundry at the earliest. He told the Southern Metropolis Daily reporter, "Before doing NVC, we also worked with the boss of Hong Kong for processing. At that time, it was an OEM, mainly a well-known brand in the West. Objectively speaking, the business at that time was still very good, the benefits. Also, the order is not bad."
But soon, Wu Changjiang discovered that the price difference between lighting equipment from the manufacturer to the end customer is very large, and the gross profit margin of sales is very high. Therefore, it is necessary to “build the channel by yourself and take the fate in your own hands.†However, this idea was adopted by him at that time. The boss objected, and the boss said: "We are doing very well now, with little investment and good results."
Thus, at the end of 1998, Wu Changjiang resigned and founded NVC Lighting, focusing on channel construction and developing affiliate stores.
But at this time, he only had 1 million yuan, and he had no money to advertise or market. "There are few products at the beginning, and people have to open a store. Many people are not willing. This is a big risk. A specialty store may have to invest. 10,000 to 20,000 yuan, the highest level of flagship store investment of 100,000 yuan, if you can not make money, he certainly will not do." Wu Changjiang said. In order to attract franchisees, NVC not only does not charge the initial fee, but also "subsidizes" them. "Opened the store, I gave him a subsidy of 20,000 yuan, so that he has no worries." NVC also shortened the 30-day delivery time in the market to 15 days. However, there is a premise: the franchisee's first order purchase can not be less than 100,000 yuan, and is cash in stock.
But after the store opened, another problem appeared. "The store is empty, even if it is a store of 20 or 30 square meters." Wu Changjiang recalled. Because NVC's products were limited at the time, they could not be filled with storefronts, so some franchisees also sold other brands' products in the store.
In response to this situation, Wu Changjiang also thought of a move, let these brands put their own OEM, or stick to the NVC brand. "Nike can be branded, why can't we NVC?" Wu Changjiang said, "For example, I don't have this style. I integrate it in the industry and let others process it. We send people to supervise product quality and qualified products. Put on the NVC logo and put it in my store."
This approach has led to a rapid increase in the number of NVC stores. Since the opening of the first store in Shenyang in 2000, its stores have grown to more than 300 in 2003, more than 1,000 in 2005, and now more than 2,500, and 35 regional operations centers.
Channel saturation? There are also "invisible channels"
By 2002, NVC realized that traditional channels had limited room for growth, so began to explore another new channel, “invisible channelsâ€, such as home improvement companies, tooling companies, design institutes, designers, decorators, electricians, etc. Wait. In Wu Changjiang's view, these "invisible channels" are very close to consumers. Although they are not the final purchasers of products, they can have a strong influence on the purchase behavior of buyers.
Wei Wei also pointed out that the key to competing for this market lies in "invisible channels." He analyzed that in the commercial lighting field, almost 60% of lighting products, especially engineering lamps, are dominated by the designer team. In markets such as Beijing and Shanghai, sales of engineering lighting products accounted for 70%.
The performance of “invisible channels†in key projects is particularly evident. For example, in June 2006, in the Olympic bidding project, NVC also developed an invisible channel, and finally obtained an order for 70 million yuan of lighting engineering. At the time, NVC hired a very experienced design team to ensure the winning bid. For example, experts from Beijing Architectural Design and Research Institute, Qinghua Institute, Shanghai Fudan Electric Light Source Department, Shanghai Lighting Research Institute, etc., invited them to serve as R&D and team consultants for “NVC Lighting Olympic Engineering Lightingâ€, through the early product innovation design. And lighting design for promotion.
Of course, the cultivation of invisible channels requires a lot of energy and skill. At the headquarters, NVC has established a professional service team. In various regions, NVC will use its own operation center in the local area to establish contact with the decoration company and design institute there, and regularly invite its designers to visit NVC's business. Deepen their understanding of the company and products; at the same time, provide various forms of sponsorship for the activities organized by the decoration company and the design institute. For example, in the Asia-Pacific region, the first German "DIALux" lighting design software was introduced, and the national lighting design competition was sponsored in China.
Let the franchisees act as the regional general manager of the store's rapid expansion, and brought new problems to NVC. Due to the unevenness of the specialty stores, there are still many couples and stores, and because of the unified management of the NVC headquarters, there is often a vicious competition between each other, and even the phenomenon of cross-selling. In this regard, NVC has adopted two methods.
The first is to change the cooperation model with the specialty stores and improve their profitability. Initially, NVC resold the dealers on the basis of sales volume. In 2004, NVC canceled this practice and changed the subsidy for dealers to the number of employees, forcing dealers to change the “male and wife†model and conduct the company. Operation.
The second is to set up a provincial operation center, which is responsible for managing the regional specialty stores and narrowing the management radius.
In April 2005, NVC selected dozens of large-scale dealers from across the country and integrated them into 35 operation centers. Its role is no longer a simple sales function, but a local logistics. , funding and shipping platforms. Serving the service and management in the region, other smaller dealers are in contact with the operation centers in each region and are no longer directly managed by NVC.
The general managers of these operations centers are the best performing distributors in the capital cities. They have their own direct sales stores, while taking care of the operation and management of the entire region.
NVC headquarters is responsible for product development, brand promotion, sales support, customer service and other functions. The factory pass rate of the product remains above 99.5%. In order to fully support the channel providers, NVC also provides stable and reliable working capital to the channel providers through credit granting. At present, the NVC market credit support amount is nearly 200 million yuan.
Through the exploration of various cooperation modes, NVC's dealers have achieved tremendous development in the past 10 years. Some of them have annual sales of over 100 million yuan, more than 10 years of annual sales of more than 50 million yuan, and a large number of annual sales exceeding Ten thousand yuan.
The repeated channel changes have also enabled NVC's brand to be established, and it has made it clear to the competition of foreign giants.
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