Changhong wanted to open up the American market, but it was owed 4.4 billion yuan in payment. Now Changhong's annual operating income is only half that of Xiaomi, and its annual profit is only 1% of Gree's. Also, because of the urgent need for liquidity, Changhong Building with a value of10.50 billion was sold at a price of 80 million.
Changhong, a former home appliance giant in China.
Changhong's predecessor was a military enterprise established by 1958, and 1965 was converted to civilian use, but its product quality has always been known for its military quality. The rise of Changhong is closely related to the strategic layout of Chairman Ni and his sensitivity to the market. Ni entered Changhong at the age of 23, and grew from an ordinary worker to a workshop director and factory director, and later served as the chairman and general manager of the group.
1980, changhong introduced technology from Japan and established the first modern color TV production line in China. During the period of 1985, the color TV market was basically TVs under 25 inches. At this time, Ni boldly advocated the production of color TV production lines of 29 inches and above, so Changhong took the lead in producing large-screen color TVs in China, and the products immediately swept the country.
Later, Ni also formulated the development strategy of "Southwest first, then China". In order to make Changhong the first brand in the country, he also played a marketing strategy of "benefiting consumers and reducing prices nationwide", which made the backlog of color TV sets in the warehouse sold out. When other color TV companies cut prices again, Changhong has occupied a considerable market share.
From 1988 to 1999, Changhong carried out three price wars according to different market conditions, thus becoming a powerful and dominant national color TV brand in China TV industry. Changhong 1994 was successfully listed. In just four years, the market value of its share price rose by 15 times. At the end of last century, Changhong's annual output value accounted for 15% of Sichuan's total GDP. By 2009, Changhong has ranked first in the national sales of color TV sets for 20 consecutive years. For every 3 color TV sets sold in the market, 1 set is Changhong brand.
2 1 0 years before the century, Changhong still maintained the momentum of rapid development and took the lead in producing digital high-definition card-reading TV sets in China. Acquisition of Meiling Electric Appliances and Huayi Refrigerator, March into the refrigerator industry, and accelerate the industrial layout of enterprises.
After that, Changhong gradually declined, which many people think is related to the loss of the American market and the large amount of payment in arrears.
Entering the American market failed, and domestic sales also fell sharply.
2/kloc-0 At the beginning of the century, the domestic color TV market was saturated, and Changhong needed to find another way to develop in this field. In order to open the market, Ni decided to export color TV sets abroad, regardless of the opposition from the top management of the enterprise. Since 200 1, Changhong has started its export trade. After investigating their American partners, they finally chose APEX to sell Changhong TV sets in the United States.
It is estimated that Changhong's vision for the future at that time was too beautiful and did not fully consider the possible risks. Changhong cooperated with APEX company to settle the funds on credit, which also laid the groundwork for the later failure, and APEX company is a company with poor reputation.
Since Changhong supplied to the United States, APEX has been in arrears with the payment for goods, and the amount has been accumulating. The first year is1800 million yuan. Changhong continued to supply, and the arrears were not settled. In three years, APEX defaulted on Changhong's payment for goods as high as 4.4 billion yuan.
The loss of 4.4 billion yuan once affected Changhong's cash flow. However, for a household appliance enterprise with an annual output value of 1000 billion, 4.4 billion bad debts are only a small problem and will not affect the overall development of Changhong enterprise. At most, the development of the American market is unfavorable and foreign channels have not been opened. However, the domestic market that Changhong has occupied cannot be lost. National life is getting richer and richer, and household color TV sets are also facing upgrading. China is a huge market. Changhong will miss the opportunity if it is one step slower than other home appliance companies.
Changhong, which once occupied half of the domestic home appliance market, has been caught up by other brands in the new round of competition and is far behind. After 2003, the sales volume of Changhong TV has retreated to the fifth place in China, behind Hisense, Skyworth, TCL and Konka.
If Ni's strategic mistake in entering the American market was the beginning of Changhong's decline, then a series of strategic problems after taking over accelerated Changhong's decline.
Investing in plasma display missed the best opportunity for LCD TV transformation.
The first color TV we saw used a cathode ray tube. In 2004, CRT technology was gradually eliminated. The new product will be a flat screen TV. There are two technologies, one is plasma and the other is liquid crystal. At that time, these two technologies were equivalent, but the investment threshold of LCD panel was high.
At this time, domestic color TV enterprises need to make a judgment between plasma TV and LCD TV. Zhao Yong, chairman of Changhong, chose to invest heavily in plasma production line, but later the world TV industry chose LCD TV. During the period from 20 1 1 to 20 12, Changhong produced a large number of plasma TVs that did not meet the market demand and could only end in failure.
Changhong's decision-making mistakes not only brought huge investment losses, but also made enterprises lose the best opportunity to transform LCD TVs.
Pursuing diversified development, the main business has problems, and selling office buildings at low prices to protect themselves.
At this time, Changhong still didn't work hard on the main business, but worked hard on the once advantageous industries. Instead, it developed diversified industries, including batteries, air conditioners, mobile phones and IT industries, and later entered unrelated real estate industries, so that it gradually lost its brand focus and retreated from the first-line camp of color TV.
The final result of this practice is that in 20 14 years, the most profitable of Changhong's many industries is real estate, while color TV sets are losing money. At the same time, Changhong also has problems in internal management, such as lax product quality control and lagging after-sales service, which has caused many complaints from consumers. In the long run, consumers gradually lose trust in Changhong brand.
There is nothing wrong with any enterprise seeking diversified development, but it must first maintain its core competitiveness and set foot in other industries on the premise of stable main business. Any business expansion that ignores product quality and after-sales service will eventually lose consumers and market.
Successive strategic mistakes and internal management problems have caused Changhong to lose money and urgently need liquidity. In order to change the status quo as soon as possible, in September 2065438+2008, Changhong sold Changhong Building in Jing 'an District of Shanghai for 80 million yuan, while its market price at that time was at least 65438+500 million yuan. Unfortunately, the former home appliance giants are now selling office buildings at low prices.
Under the comprehensive effect of various reasons, Changhong, a China home appliance giant, has been eclipsed and fallen from the altar. It is a pity that once proud national brands have to sell their buildings to protect themselves. Under the new opportunities of Internet and 5G development, we hope to see Changhong get out of the predicament and rise again.