Chapter 2876 Informationization

Zhou Buqi agreed with the approach of reducing logistics costs and said, "Well, reducing logistics costs is of great significance. It is not just about saving tens of millions. It is also a strategic consideration. Do you know what strategy it is?"

"Uh..."

Meng Houkun looked at him with a bit of resentment.

Zhou Buqi said angrily, "E-commerce! Now is the era of the Internet, and the e-commerce industry is developing in full swing. The brand flagship stores on JD.com are all directly operated, and there are also Tmall flagship stores. They are not run by distributors, but directly by manufacturers to consumers."

"Yes, I think so too." Meng Houkun was telling the truth. He did have such a plan. He also worked at Ziweixing. As an Internet person, he certainly could not allow Yuanwei Group to be just a traditional beverage company. "I said that I would lead Yuanwei Group to transform, which means that we can't just rely on traditional distributor channels, but we have to welcome the new era. And I have calculated that it is more cost-effective to do e-commerce."

"Oh? How did you calculate it?"

Zhou Buqi looked at him with some admiration.

Meng Houkun smiled and said: "Let's take a box of 24 bottles of mineral water as an example. The water cost is 4 yuan, the logistics cost is 2 yuan, and the cost to the distributor is 6 yuan. The wholesale price is 12 yuan, and the profit is 6 yuan."

The profit of mineral water is too big.

This 6 yuan is not the gross profit, but the labor, water, electricity, logistics and other costs are all taken into account. It is the net profit before tax, reaching 50%.

This net profit margin can be compared with Qualcomm.

The retail price of Yuanwei mineral water is 1 yuan per bottle, and the wholesale price is 50 cents, leaving a profit space of 50 cents for distributors and retail terminals at all levels. The pricing strategy of Yuanwei Group is affordable and practical enough.

However, the Internet is point-to-point.

The middleman can be removed!

If it is an e-commerce sales, the profit originally belonging to the distributor and retail terminal can be included in the profit pool of Yuanwei Group.

Meng Houkun continued, "If we don't follow this traditional model and go with the e-commerce model, the logistics costs will be higher. The logistics cost of a box of water may reach 4-5 yuan. But even so, the profit margin left for us is still higher than that of traditional channels."

Zhou Buqi is concerned about the logistics cost. "The logistics cost of a box of water is 4 yuan if it is sent by a courier company. The logistics cost of shipping it to a distributor is 2 yuan? Isn't that too much?"

"Who said it's not!" Meng Houkun slapped his thigh. "After I became the general manager, the first thing I paid attention to was the logistics cost. It was really scary. Don't forget that I did school group buying with you at the beginning. I know the logistics cost of the courier company. The answer I can give is that those courier companies are professional and they have the ability to reduce the logistics cost to the minimum. We are completely outsiders in the logistics industry, and there are many unnecessary redundant expenses in the process."

Zhou Buqi glanced at him, "What should we do? Do you want to outsource the logistics business to a professional logistics company?"

"Ah?" Meng Houkun was slightly startled. "No, it was outsourced at first, but later Shi Jinglin finally established her own logistics team. We can't just give up. There are more advantages to doing it by ourselves. We can better trace and track different batches, and it is more flexible in management. Well... I have some ideas now, see if it works."

"Tell me about it."

"The high logistics costs are not only due to high energy prices and market uncertainty, but also due to the long supply of raw materials. For example, our Yuanwei mineral water has a lower profit margin than Nongfu Spring and Wahaha pure water, and their net profit after tax can reach 50%. A very important reason is that their water sources are more abundant, and they usually take water from their own province. Our mineral water comes from Changbai Mountain and then transported nationwide, so the cost naturally goes up."

"So we need to adjust the business line?"

Zhou Buqi had previously suggested that we should do business such as packaged water, purified water, and boiled water, which have lower costs. However, Shi Jinglin was busy developing the market for functional beverages at the time and had no time to take care of it.

Meng Houkun said: "Yes, on the one hand, it is to adjust the business line, and on the other hand, it is necessary to have more abundant factories."

"Well, that's good."

Zhou Buqi nodded.

Meng Houkun said: "Also, there are too many ineffective transportations. Many orders are very small, and then scattered transportation and round-trip transportation have caused a lot of unnecessary logistics waste, and even loss of cargo space and difficulties in personnel scheduling, all of which have led to increased logistics costs. I asked Chaowan Commune, Aisda, and several other companies, and they all have such troubles. I think this part is something we are capable of solving, just like you said, we need to do digital management."

Zhou Buqi was very satisfied, "Yes, that should be the idea! To improve the level of informationization of logistics, we need an informationized team to do this. We need to develop a digital system for logistics information, with a GPS positioning system and electronic bill of lading tools, and the functions of real-time monitoring of the source of goods and route optimization. Not only should the delivery be like this, but also the harvest from the supply chain should have this kind of digital management, to achieve data sharing and cross-departmental collaboration, and to reduce the unit cost of each link through a vertical division of labor structure."

It's not complicated at all.

All of these ideas come from the Internet. They are very simple and easy to understand.

But in reality, it is very difficult to put them into practice.

If a company like Ziweixing does this, it’s really not difficult, it’s very easy. But for traditional companies, it was really a huge challenge. When Huawei relied on IBM's help to carry out digital reforms, it also raised a beheading knife and cut off a large number of core executives to promote it.

Meng Houkun said: "That's not all. I think we should develop multi-channel intermodal transportation. Previously, the transportation method we used was mainly large trucks, which was too expensive. In fact, there are also lower-cost trains, and Lower shipping costs. However, multi-channel transportation will further increase management complexity. Yuanwei Group has not even understood the full freight model, and there are often repetitive transportation and uneven manpower deployment. However, if a digital system is introduced for digital management, this complexity will be nothing.”

"Huh?" Zhou Buqi's eyes lit up and he couldn't help but praise, "Okay, isn't that a great idea! You don't need my teaching at all, you can be the general manager!"

Meng Houkun scratched his head, a little embarrassed, "I asked Shi Jinglin for advice."

Zhou Buqi said nonchalantly: "You can ask anyone for advice, there's no shame in it. I think this idea is good and you can do it this way."

Meng Houkun said: "Then I'll take action. I want to recruit someone from JD Logistics."

"Jingdong?" Zhou Buqi was a little worried, "Can you come?"

Meng Houkun said: "There is an alternative plan. If JD.com's one doesn't work, just go to a vice president of SF Express. The alternative one has been contacted, and the probability of success is very high."

Zhou Buqi nodded, "Okay, let's give it a try. This is a big project and it's not easy to do. If you want to achieve results in the short term, it's best to spend money on advertising and brand building, and try to increase the popularity of Dongpeng Special Drink." It took a lot of effort to buy Dongpeng Special Drinks, but in the past two years, the factory director didn’t pay much attention to this business.”

Meng Houkun laughed and said, "It's as if you and Shi Jinglin have discussed it, and they said exactly the same thing."

Zhou Buqi said angrily: "Okay, tell me your secret quickly. What's going on?"

"One piece of good news, one piece of bad news."

"The good news first."

"The higher-ups have spoken." Meng Houkun pointed upward, "The new energy vehicle industry can be developed, which is in line with the major policies of a manufacturing powerhouse. When the process of this period is completed, it will probably be announced. This is confidential. No one knows!"

Zhou Buqi said "hmm" and was not surprised.

Meng Houkun said: "There is another piece of bad news that is not in your interests."

"What?"

"Do you want to push Tesla to build a wholly-owned factory in China? At present, it is unlikely. But I can't tell you this. I will inform you after you really push Tesla to open source all its patents. My father asked me to send you a message at the risk of violating organizational discipline."

"I have no selfish interests." Zhou Buqi said calmly, "Everything remains the same. Open source will still be open source. I will let my heart shine on the moon. As for who the moon shines on, I can't control it."