"The Great Defeat" Notes (I)
First, the general lack of moral sense and humanistic care awareness of the grass-roots group of Chinese entrepreneurs, in a sense, is considered to be a "utilitarian, unscrupulable idealist" club, in this particular group spread a morbid morality. In the attention of Shi Yuzhu, Wu Weixin, Jiang Wei this generation of tragic figures, we will find a very strange phenomenon. The vast majority of these entrepreneurs are impeccable in terms of their personal qualities and morals, even to the point of being strict with themselves. Their lives are very frugal, do not pay attention to eating and wearing the platoon, do not do the general upstart's broad-mouthed face, sincere and frank people, work seriously into. At the same time, they are also some very sincere "idealists", they have their own ideals and programs for the progress of Chinese society, the Chinese nation and Eastern civilization have deep feelings and sense of responsibility. Some of them are more of a defender of the frenzied national economy. But when we look at its market behaviour, we see a different picture. They are extremely contemptuous of the public's IQ, exaggerating and free-to-air in marketing and promotion; they are indifferent to the rules of the market game, ruthless and eerie to their competitors. And our public opinion and social collective consciousness has a deep-rooted "the king, the loser is the ko" consideration standard, for those entrepreneurs who have achieved brilliant market performance often have no intention of investigating the morality of their process, which to a large extent also contributes to the utilitarian consciousness of entrepreneurs. This phenomenon has become almost the deadliest disease preventing many of China's new generation of entrepreneurs from truly maturing. This book is to be interpreted as contempt, indifference and thinness that will ultimately hurt entrepreneurs themselves and their careers.
The first failed gene lacks moral and humanistic care
Many of our entrepreneurs lack compliance with the rules of the game and respect for our competitors. At the level of defending market equity, their sense of responsibility is rather weak, often opening the river and turning the clouds over. They are a group of entrepreneurs who are accountable to themselves, to their men and to their businesses, and lack a minimum sense of responsibility for the equilibrium and order of society and the economic order as a whole, a contrast that creates a split between their personal morals and professional ethics. A significant proportion of them follow the example of "people who don't play cards by card". In their subconscious, "card theology" is for all beings, geniuses such as me, will not be limited to this. So the sky is empty, there are no taboos. Don't you know, if everyone doesn't play cards by card, then what else do they have to do with cards? A person who always doesn't play cards by card, who else wants to play cards with him? A person who does not play cards according to the card, he obtained excess profits, in fact, to hurt the interests of the majority of people who play cards according to the premise, is to destroy the market order as a strategy to win in chaos. Thus, when many entrepreneurs are defeated, it is not surprising that there are often more cold-eyed bystanders and fewer rescuers;
contempt for the order of society
A true "entrepreneurial economy" should have three basic characteristics: first, the country has a large number of medium-sized modern enterprises, they have become the incubator and driving force of the country's economic progress with vigorous vitality;
Three key points of the entrepreneurial economy
In Shenyang, Ji Changkon completed an extremely beautiful siege campaign. He bought out segments on local television stations, ran intensive advertising, and then ran to the street, along the street to invite the public to taste Qinchi liquor free of charge, and then with the local technical supervision department to do a good relationship, ask them to make quality appraisal report, and to consumers solemnly recommend. In one of the most sensational of all, he chartered a large airship to swim over downtown Shenyang, then scattered tens of thousands of flyers, a scene of spectacular chaos, attracting countless non-controversial. In China in 1993, is a "only afraid of unexpected, no can not do" era, the concept of market economy has just surfaced, all kinds of strange gossip-style promotional means are allowed to try. If government departments can act as promoters in corporate market movements, they are seen as pro-reform moves. In an atmosphere in which the rules of the game and social characters are all very chaotic, the loudest, boldest and most outlier will undoubtedly be the biggest winners. In less than 20 days, Qinchi wine in Shenyang has begun to be well known and popular. Ji Chang-kong quickly published in the media "Qinchi liquor out of stock in Shenyang" news, and used some very legendary words: two Shandong dahan, carrying 500,000 yuan, 19 days to open the door of Shenyang ... Obviously, Ji Chang kong is a very good power-making person, he knows how to use any existing social resources, he knows how to attract the public's attention.
Qinchi reported 320 million yuan, equivalent to the 1996 Qinchi full-year profit of 6.4 times, Qinchi can not take this astronomical huge sum? This is a question that many people have asked Ji Chang kong. Each time, Ji Chang-kong took pains to account for everyone to listen to: this 320 million yuan including four parts, it is expected that in 1997 Qinchi sales will reach 1.5 billion yuan, of which 13.6% will be used for advertising, internal excavation will save 80 million yuan, in 1996 Qinchi profits of 60 million yuan will be used for advertising, as well as a part of the return of advertising agency fees ... However, in Ji Chang kong's heart already has another account that can not be detailed to people. In those two years, with the banquet wine, Qinchi won the bid, the domestic large and small liquor enterprises have been unique, all kinds of liquor advertising is flooded with the media, can be said to be the whole country drunk, drunken days, causing public disgust. Some experts have written that in 1995 China's liquor production reached a record 7.9 million tons, consuming 21 million tons of grain, has been abnormal expansion trend. As early as this summer, Ji Chang kong has been information that the relevant state departments will soon limit the growth of liquor production, and liquor enterprises in the important media to limit the intensive advertising. Before bidding, Ji Chang kong had already calculated that, according to state restrictions, even if CCTV gave all its eight channels of liquor advertising to Qinchi, a year is less than 200 million yuan. With such a judgment, Qinchi whether it is bidding 300 million yuan or 500 million yuan, is the same thing. So the rope sings a play of pride, take their own phone number to bid. This is the final fact: just when everyone was speculating about Qinchi's 320 million yuan guess, the CCTV and Qinchi were playing an unannuable double-reed play. The former wants to build momentum, the latter wants to take advantage. In the thrilling Medea, everything seems premeditated. It seemed like a pleasant game, and at the Medea Centre that night, no one had foresheadowed that, just two months later, a sudden nightmare had followed.
The shunned Chang, the reverse dies
"Spring Spring" white winery director told these reporters, in 1995 Spring Spring to Qinchi supply 4000 tons of loose wine, Qinchi won the bid to the Spring Spring loan funds; When asked if Chunquan had bought some of the local small wineries to supply Qinchi with loose wine, the factory director replied yes. In The Economic Reference, the reporter also found several other small and medium-sized wineries that also supply loose wine to Qinchi. A fact that has never been known to the public finally embarrassingly surfaced: Qinchi annual production capacity of only about 3000 tons of raw wine, they bought a large number of loose wine from Sichuan, coupled with the factory's original wine, alcohol, hook into a low-level wine, and then to "Qinchi ancient wine", "Qinchi special music" and other brands sold to the national market. In the report, the reporter also detailed their interview in Qinchi winery saw and heard: "Qinchi can line is basically manual operation, each line around more than 10 operators, the inner lid of the bottle is specifically by a person with a wooden hoe to knock in." County labor is very cheap, from the economic benefits, canning does not need to be automated, arranging employment is also an important task of county-run enterprises. Such a description, as well as the disclosure of the news about Sichuan wine into Qinchi, is almost self-evident to Qinchi, who has just won the bid. After the economic reference newspaper's report was published in mid-January 1997, they spread rapidly across the country like thunder. Almost in a short period of time, this report was reprinted by countless domestic newspapers, but also immersed in the joy of the standard king Qinchi encountered the most dangerous, the most unexpected blow.
It is common sense to judge that it cannot produce so much white wine
China's media has always had an irrational side, in their value judgment system, the easiest to be tolerated is the weak, the most respected is the thinker. Therefore, the best planning should be: the planner packaged as a weak person or thinker image. Because the so-called strong are not favored in the eyes of the media. In its day-to-day time, there will naturally be countless journalists around the strong, but once the enterprise appears a little crisis, they will immediately counter-attack, to reflect, know, judge the role to show their professional ethics. These truths have not yet been understood by many Entrepreneurs in China
Crisis PR has a problem
Wang Keli, a Beijing planner who once served as "Qinchi's first conspirator" and wrote "Dancing with the Standard King", counted the five major crises of Qinchi: First, the media dominated Qinchi's development, which was unexpected, so the development itself has not yet entered the level of "growth strategy"; The rapid growth of enterprises may exacerbate the contradiction that enterprise management can not keep up with the scale of enterprise development, fourth, the short-term excessive growth may lead to enterprise disorder, inefficiency, and thus harm the long-term development of enterprises, fifth, the concept of development is not only the expansion of market share, not only the increase in product output, but the all-round progress of enterprises characterized. Although we have put forward the "sustainable development strategy" according to the reality of Qinchi, but Qinchi still did not jump out of the "quite sudden, uncontrollable decline and decline" cycle law.
More fair, from the Qinchi wine industry public relations crisis can be seen that the management lack of the necessary talent reserves
In March 1998, Ji Chang kong left Qinchi and was transferred from Linyi County to a ministry in Beijing. He stayed in Qinchi for 5 years before and after, during this period, his monthly income is 800 yuan, the bonus is 80% of the first-line workers, Qinchi has not implemented the annual salary system. Before leaving, he said two words: one is the evaluation of Qinchi, he said: "Qinchi is a mule." The second sentence is a summary of his five years of work experience in Qinchi, he said: "The country has a big head, the place has a middle head, the enterprise has a small head, the individual has a disease." "
In 1992, Shi Yuzhu, who was proud at the top of his career, decided to build the Giant Building, when the giant's assets had exceeded 100 million yuan and its liquidity was in the millions. The original plan was to build 38 floors, mostly for your own use, without the idea of real estate. Later this year, a central leader came to visit the giant, when he was led to the giant building site visit, looking forward to the four, he said to Shi Yuzhu very high, the location of the building is very good, why not build a little higher? That's the sentence that made Shi Yuzhu change his mind. As a result, the design of the Giant Building was raised from 38 to 54 floors. At this time, another news came, Guangzhou wants to build the country's tallest building, set at 63 floors. It has been suggested that Shi Yuzhu should win glory for Zhuhai, the Giant Building to build to 64 floors, the country's tallest building, Zhuhai City has become an iconic building. By early 1994, another central leader was visiting the giant. I do not know which careful person suddenly thought, "64" this number seems unlucky, the leader will not be happy, so immediately called the design unit in Hong Kong to consult, one after another, the rope is set on the 70th floor. This is the investment decision-making process that ultimately led to Shi Yuzhu's defeat. At a time when the whole country is in a state of radical torrent, no one is aware of the risks and imperceptibleness inherent in this series of accidents and randomness, and no one can see that the fuse of the crisis has been smoking since then.
The brain began to be awake
Shi Yuzhu is full of confidence. At that time, the giant's M-6403 Hanka sold very hot in the market, in 1993 sales increased by 300% over the previous year, the annual return of more than 30 million yuan, if this momentum is maintained, building funds should not be a problem. Shi Yuzhu made a mistake that many young entrepreneurs are prone to make: using the expected profits as actual gains and using them as a base to set their own plans.
There are still a lot of bosses like that
Just two months after Jiang Zemin visited the Giant Group, Shi Yuzhu sounded the alarm at a meeting of all staff, and he dissected the five hidden dangers of the Giant Group: the basic disappearance of entrepreneurial passion, the emergence of pot and rice phenomenon, low management level, product and industry single, the development of market capacity stagnation. These five hidden dangers, in addition to the "product and industry single" this article, until the demise of the giant group has not been fundamentally improved, but also become the world's future evaluation of the giant's failure.
Soberly aware of the root causes of failure, but unable to return to heaven, this is more sad than direct failure without knowing
At that time, the health care products industry basically belongs to a mature market, in the sun god, flying dragon and other enterprises under the "advertising fertilizer", in 1994 the national health care products market sales revenue of 30 billion yuan, and no major international brands to participate in the war. Shi Yuzhu's attempt is very obvious, he hopes that through the new expansion to stimulate a new entrepreneurial passion, the use of the giant's brand advantages to quickly grab excess profits, and as a way to ease the development of leading industries and management mechanism contradictions. This approach has been tried and tested in the history of many companies and has helped them emerge from the crisis. However, in this strategic shift, Mr Shi made a mistake: he failed to take effective measures to stabilize the start-up industry and existing projects, which could include co-operation with foreign investment, equity of assets, access to technical support from multinationals and so on. Instead, he wanted to go hand in hand, eventually creating a multi-line combat situation. At the time, if the Giants had indeed set strategic goals for industrial transfer, it should have divested the assets and management of computer companies and the giant building projects already under way to operate independently. On the contrary, Shi Yuzhu embarked on a multi-line war, all the glory and loss of the road. He personally, the establishment of the three major campaign headquarters, under the East China, Central China, South China, North China, Northeast, Southwest, Northwest and overseas 8 major forces, of which more than 30 independent branches changed to the army, division, general managers at all levels have changed to "the commander of the army" or "the commander", "the division chief." In the mobilization order, he wrote: the three major campaigns will invest hundreds of millions of dollars, direct and indirect participation of hundreds of thousands of people, the campaign will take the group military combat mode, the direct purpose of the campaign to achieve a monthly profit of hundreds of millions of yuan. The long-term goal of forming a marketing team of 10,000 people is to use the battle to hammer out a cadre, so that young people in two or three months to grow into military chiefs, division chiefs, can lead tens of thousands of people to fight.
into a madness
"If you don't want to solve it but you're going to make trouble, you're going to make a fuss, " one lawyer yelled at creditors and reporters. As a corporate act, it's no problem to expose anything to society. If you want exposure, you can expose first, and then talk, we are not afraid of exposure. "
In the outbreak of the giant storm, some domestic media showed an unusual commitment and dispassion, playing a very ambiguous fear of the world not disorderly role. In the words of a senior member of the Giants, "the company that they touted for years was completely destroyed overnight by the fire of the fallen rocks". Shi Yuzhu in the crisis has made several attempts to restore production and sales order, but several times by the media follow-up reports disrupted. Every time there is a report, it will lead to the departure of a group of backbones, increase the number of debt collectors to the door, so that a vicious circle, difficult to save. Shi Yuzhu later had a very puzzled feeling: "The giant has always been a 'news enterprise', I am also a 'news person', think inappropriately can not." Before the news always said the giant is good, this is also good that is good, now say the giant is not good that is not good that is not good. I had planned to do a good job in 1997 market, but all over the newspaper reprinted the giant storm, said the giant almost closed down, the product no one dare to buy, this sub-problem is big. "After the giant storm subsided, the domestic media itself had a review of this, and when the "Love Multi Incident" broke out a few years later, some people called on everyone to calm down so as not to repeat the mistakes reported by the giant. Of course these are the back words. In those bloody days, Shi Yuzhu had been hiding in the president's office on the fourth floor of the Giants' headquarters. Shi Yuzhu combines the office, study, bedroom, conference room and secretary room, forming a closed 300 square meters of "Shi's space". When the crisis broke out in full, Shi Yuzhu hid in this "island", pulled down all the curtain, refused to contact with any outside world, the whole day in the big house without a trace of sunshine sitting alone. Shi Yuzhu, who has always been unsociable, doesn't seem to have any close friends, and even in his glory days, he was not very good at interacting with the outside world. Whenever he wants to make a big decision, he likes to lock himself up, pacing back and forth in the house, thinking hard. Over time, the carpet in the large office area has been uneven and appears to be potholed. Shi Yuzhu shut himself down on the island for dozens of days. It was these days that the news media bombarded the Giants, and the image of the Giants was destroyed. However, Shi Yuzhu has never had even a serious and intimate dialogue with the media and society. 'We don't have to take the initiative to find any reporter, our reputation is so bad, it's so bad, what else can we do? ' he said, unusually calmly, to the only few people who still had a thy thy thy thy d'affaires of hope for him and the Giants. In this way, Shi Yuzhu easily gave up the last chance to get sympathy and rescue. In fact, the crisis facing the Giants at that time was not to the point of killing.
Shi Yuzhu himself has a problem
At that time, the Giant Group in addition to the Giant Building has no other fixed assets, the company's marketing throughout the country is still in operation, estimated that the sellers owe the Giant Group about 300 million yuan, Shi Yuzhu himself estimated that the benign debt of at least 120 million yuan. However, due to the overall collapse of the group soon after, that is, the vast majority of the 120 million yuan finally failed to recover, in a sense, it is Shi Yuzhu that lack of communication personality at a critical moment finally buried the giant group. Wang Jian, who served as executive vice president in the late Giants, once commented on Shi Yuzhu that his biggest weakness was Qinggao, the biggest weakness was dealing with people, and the biggest limitation was the zero-debt theory.
It's not necessarily a good thing not to be in debt
My four major mistakes / Shi Yuzhu first, blind pursuit of the speed of development. Giant Group's output value target can be described as big: 1 billion yuan in 1995, 5 billion yuan in 1996 and 10 billion yuan in 1997. However, the greater the target, the greater the risk, if not scientific analysis and demonstration, there is no need for organizational assurance, will inevitably lose a lot of money. Second, blind pursuit of diversification. Giant Group involved in the computer industry, real estate, health care products industry, such as the industry span is too large, new areas are not the advantage, but eager to pave the way, limited funds are firmly locked in, the Giant Building caused by the financial crisis almost dragged down the entire company. Giant's main business - the computer industry's technological innovation once stagnated, but put a lot of energy and money into their unfamiliar areas, lack of scientific market research, good success, did not form a mature diversified management capacity. Third, the decision-making mechanism of "giant" is difficult to adapt to the development of enterprises. The Giants also set up a board of directors, but that was empty. My personal shares accounted for more than 90%, the specific figures themselves can not be said, the financial sector is not clear. Several other bosses have no shares. So they rarely stick to their opinions when making decisions. Since they have no shares, they cannot interfere with my decision-making. The president's office meetings can influence my decision-making, but it's basically up to me. In retrospect, the mechanisms that govern my decision-making do not exist. This kind of highly centralized decision-making mechanism fully reflects the high efficiency of decision-making in the early stage of entrepreneurship, but when the scale of the enterprise is larger and the comprehensive quality of the individual is not comprehensive, the lack of a collective decision-making mechanism, especially the intervention of a person's wrong decision-making is weak, then the operation of the enterprise is quite dangerous. Fourth, technological innovation in the main industry has not been placed in an important position. From the 1989 M-6401 desktop typography system, the 1990 M-6402 word processing software system, to the 1993 giant Chinese handwriting computer, giant software, etc. , these are the key to the success of the original giant. After the computer industry entered a low ebb, I ignored the technological innovation of this "giant" computer lifeline, for two consecutive years in the industry response flat, until 1996, "giant" only launched the M-6407 desktop layout system. The loss of the Giants' second venture has a lot to do with it.
Introspection and not making mistakes in the future are two different things
In February 2001, Shi Yuzhu participated in a press release event of Taishan Industrial Research Institute. "I roughly calculated that there were at least 13 ways to kill a private company," he said in his statement. This does not include internal reasons, such as poor management. "The first method of death is unfair competition." Competitors want to whole you, you are in the bright place, he is in the dark, it is easy to kill a business. There are many ways to damage your reputation, such as false accusations and lawsuits. In the fall of 2000, the National People's Congress and the CPPCC in half of the country's capital cities suddenly received daily complaints about brain platinum products, which led to blocking brain platinum sales. After investigation, we found that some competitors had hired several people in each city, and their main job was to write letters of complaint against Brain Platinum. As soon as the matter was discovered, the letter of complaint disappeared. The second way to die is to meet a malicious "consumer". Shi Yuzhu said they had met a person in Hubei, the body somewhere bone growth on complaining about the manufacturer's products have a problem. The third way to die is to surround the media. Perhaps for the reason that the media is still worried about, Shi Yuzhu did not talk about the media in the giant when the fall of what role, but cited the example of the bank: "For example, once the media surrounded the bank, the bank operation is healthy, it says you are insolvent, depositors just go to raise money, the bank is certainly finished." The fourth method of death is the non-objective reporting of the product. Shi Yuzhu believes that in the field of drugs and health care products, any product can not be 100% effective, if 70%-80% effective is better, if 90% effective, the product is called excellent; The fifth method of death is for the competent authorities to kill the enterprise. "The product is bigger, even if it has a failure rate of only one in ten thousand, but if it is complained to the competent authorities, it is possible that the entire product's approval has been revoked." There are also penalties imposed by local authorities. "For example, the Administration for Industry and Commerce has a fine task every year, and when the end of the year the task is not completed, it is only possible to find well-done enterprises to complete the task, because these enterprises have cash." According to Shi Yuzhu, in 2000 in a city, they had been an industrial and commercial administrative office for no reason to fine 500,000 yuan, do not pay the 500,000 yuan will not let them sell products in the local. Therefore, we have to pay a fine. Who knows just over a month, another industrial and commercial administrative office also said that the task has not been completed, asked them to pay 500,000 yuan. "We have to hold our breath, do business, especially do private enterprises, if we want to live can only bow their heads." The sixth method of death is the flexibility of the legal system. "A lot of things, it's a good thing to say that, but to put it another way, it's probably a crime, " he said. Coupled with the imperfection of the legal system, you have to break the law. For example, before the provisions of the import of computers must have approval, but private enterprises simply can not get approval, you want to do computer can only spend money to buy approval. And in accordance with the relevant provisions, buy approval is illegal, you either do not do, to do will be illegal. Many of these similar situations exist in other industries. The seventh method of death is to be deceived. Sometimes a business's money is defrauded and there is a cash shortage, or even the whole business will collapse. Especially for private enterprises, the protection of the law is very limited. The eighth method of death is the threat of red-eye disease. There are many red-eye diseases, and there are many rumors. Rumors about the enterprise is still good, the most afraid is about the product rumors, rumors together, the product immediately sold out. "The ninth is mafia extortion." When the enterprise is done well, there will be extortion by the mafia, unless it is a particularly large enterprise. Shi Yuzhu clearly believes that the undersemination forces in the development of private enterprises in the process has been all-in." The 10th method of death is to offend an official who uses his power to create obstacles to business development. The 11th method of death is "to offend a certain people may also kill the enterprise, for example, he poisoned the product." The terse method of death is to encounter fraud. "The more fakes there are, the more sales are affected, and the most important thing is to influence reputation. In a certain place in Jiangsu, there is a relatively large fake nest, household fraud, to fight fraud is useless, the local local localism protection. Later, we invited public security officers from abroad to seal off tens of millions of dollars worth of counterfeit products and counterfeit equipment on the spot. But as a result, the local public security department asked to send people back, sent back to be let go, and then continue to fake. Shi Yuzhu helplessly said: "Now, we see fakes simply can not help, had to buy back their own." The 13th method of death is the entrepreneur's own security problem. Shi Yuzhu said he himself had received a number of threatening phone calls, which never appeared when he had nothing.
13 causes of corporate death
Yan Gang: Any enterprise is faced with a problem from small to large. How to develop after the big, the basic road has two: one is diversification, the other is specialization. There are group enterprises that are diversified and successful, but fewer can survive in the long run. China's economic development in the past ten years has its particularity, that is, the market gap is many, with capital, investment everywhere can take up such a piece of development, so in previous years there have been a lot of diversified enterprises, resulting in a follow-up effect. From the perspective of the long-term development of market economy, this is not a typical way, not the most enterprises can succeed. Because the market competition must be professional competition, the economics of the ancestor Adam Smith first talked about the division of labor, how to promote development of specialization. Many of the world's largest enterprises for hundreds of years in one area toss, making it their own strengths, a firm foothold before entering other areas. Being a leader in one respect is much better than being an anchovies in 10. Enterprises "small" and "big" is very different. Now many private enterprises still hold an opportunistic attitude, the overnight outbreak of growth is very infatuated, this is a common disease. It's possible to grow by hundreds of percent in the past, and that's in the early stages of market development. Now the market is crowded and the competition is getting fiercer. Therefore, to take a solid route, the pursuit of normal average profit margin, if there is a 20%-30% annual growth rate has been quite good, the next thing is to engage in accumulation, development. To professional efforts, do not think all day about the surprising victory "to create brilliant again" - "big" after the strategy to change, private enterprises are facing this problem.
A lot of businesses die on this
Wei Jie: Diversification is a prerequisite: First, the development of the enterprise's main industry has reached a very high level, market share, technical level, management level are impeccable, the industry's room for development to the top, the remaining capital has a big; The two are indispensable. Now some private enterprise owners have not done a good job, on the rush to pave the way, borrowed money to throw in, the result is all set to death, is the enterprise itself to diversification into a big trap.
Do not know and do not know the other side, every battle will be defeated
It was a sunny start-up, although the factory was so shattered that it was hard to stand on, and although many crafts were still done by hand, although everyone did not know how far the success was from them, they knew that the sun would rise tomorrow. Because they know the factory price of 2200 yuan Edo VCD, each profit has 700 yuan to 800 yuan, as long as sold out, they are all millionaires.
To share profits
The first batch of salesmen with Ho Chi-chi can be said to be strange, including companies selling salty fish, there are selling ice cream, there are selling prosthetic limbs, there are selling cement, and just sold three oral liquid, only did not sell home appliances. However, it may also be this deficiency that makes them free of taboos, each strange trick. Due to the extreme lack of funds, Ho Chi-peug selling VCD is the most "overbearing" step chess, that is, to require all dealers are "cash spot, money to delivery", which in the eyes of others is almost "impossible." However, Ho Chi-peek and his subordinates every place, on the entanglement of people to talk about ideals, talk about love more tomorrow, talk about the broad prospects of VCD, let everyone see CCTV love more ads, coupled with the near-profit batch zero difference, hard is to let a family than mud slippery dealers obediently come up with advance payments. Ho Chi-pegged the whole country ran down, actually brought back 20 million yuan of advance payment.
The first time to participate in the bidding will be ranked 1st in the electronics category, this news makes just over the first year of Ado leap into the ranks of well-known home appliance brands in China. Smell the smell of windfall profits of domestic dealers flocked to the town of Shandong to run. Hu Zhi standard think this is a good time for the role of supply and demand change, so put forward that each agent of many products must pay 3 million yuan to 10 million yuan of security, its agent area is divided into three categories: Beijing, Shanghai, Guangzhou as a class, the deposit of 10 million yuan; Only this trick, Edo actually "free" to collect funds of 200 million yuan, in other enterprises for financing struggling, Hu Zhiming has created a "market victory" classic case. Of course, this high margin operation is based on the premise that the product continues to sell well, its after-effects are also very obvious. The so-called "blessed" is like the more money a bank absorbs, the bigger the crisis will be if there is a run. The end of love after many days can also be said that it is at this time buried the root of the disaster.
Any boss should be alert to this kind of debt
In this price reduction battle, China's VCD industry finally fell out of the "profiteering paradise", began to enter the period of small profits. Sadly 70th, the core components of all VCD companies in China are imported, the chips are from Philip in the Netherlands and C-CUBE in the United States, and the movement is from Sony in Japan and ESS in the United States. In other words, our VCD heroes have always been just "assembly heroes" who didn't play well at the front desk, and it's the multinational giants who have mastered the core technology that really keep their money and make their money. In order to extend the life cycle of VCD products, C-CUBE and ESS company respectively launched an upgraded version of the chip, soon, by ESS to provide chips of the new section, panda, Shanghai Radio and Television, Huare and other East China faction and by C-CUBE to provide chips of the East China faction and C-CUBE to provide chips, step high, Scology and other Guangdong faction formed a new confrontation, in order to seize the market opportunity, the East China faction proposed the name of the upgraded product should be SVCD, while the Guangdong faction insisted on calling CVD
There is hardly any high added value of one's own
At that time, the blood-stained Ho Chi-th, when the name of the fight, there is indeed a place of inso-careful consideration. He downplayed years of good relations between old state-owned enterprises such as Xinke and Shanghai Radio and Television with Beijing ministries, and he tried to put pressure on state ministries to accept the concept of CVD and the industry standards they proposed by insticing strong domestic media coverage. When he learned that the name "super VCD" may be adopted, he took the lead in proposing the "product standards are the enterprise or the government is in control" of this severe question, so that a ministerial director angrily denounced the Guangdong faction "unknowingly thick"
In the past few years, Chen Tiannan has not been involved in any business affairs, the outside world does not even know that such a large shareholder exists. All personnel appointments, financial management and day-to-day operations of Edo are under the full responsibility of Ho Chi-th, and Chen Tiannan is largely unhinged. With the prosperity of Ado's cause, the estrangement between the two major shareholders is increasingly built, Ho Chi-ming's mental imbalance is conse you can think of, and Chen Tiannan joked that he is "watching others dance through the glass." In 1998, Ho Chi-th, who had always prided himself on "not playing cards by card", made several measures that Chen Tiannan could not bear. First of all, Lin Ying, who is in charge of Edo's finances, blocked Chen Tiannan's message, and then completely set aside Chen Tiannan's equity settings in several subsidiaries, such as video equipment and audio, to declare "property rights reform". This in Chen Tiannan's view is very likely to transfer assets to start a new stove. It is in Edo and other enterprises to negotiate brand rental such a matter of enterprise fate, Ho Chi-peuge and Chen Tiannan did not discuss, so that the latter as soon as they learned of this amazing news, they immediately made the strongest response. In a "lawyer's statement" on April 7, Mr Chen claimed that all of Ado's new subsidiaries had not been authorized and approved by the board of directors and that all of its operating activities and debt claims were not related to Guangdong Edo Electric Co., Ltd. The "lawyer's statement" undoubtedly sent a striking signal over the Chinese business community: something happened to Ado. Dealers and suppliers who have been distracted by Edo's arrears run madly to Zhongshan, and the media everywhere smell the blood of prey. Qinchi after the new standard king in the end can go far is already a suspense of the news topic, as early as March 1st, Edo because of the off-season reasons to stop broadcasting CCTV ads have made everyone excitedly guess for a while, this "lawyer statement" out, is undoubtedly their own door-to-door news dinner. Ho Chi-buo has always been the founder of Ado and when the family, in fact, with his contribution to Ado is indeed no one else, but put into the capital structure to consider but this is not the case, he only accounted for 45% of Ado shares, when Chen Tiannan and Yilong village united, he had no choice but anger. After 20 days of tough negotiations, Mr Ho was forced to step down as chairman and general manager, and the new king abstranded after more than a year of coronation. At this time Edo has become the world of debt collectors and journalists. Almost overnight, dozens of reporters turned Ado from the roof to the bottom of the building, and various articles exploring the "Love tragedy" appeared frequently. Always proud of the media planning Ho Chi-wan did not expect, is those who stood in front of him yesterday singing praises, and now is the first to throw stones at him. Those days he was most afraid to read the newspaper, he suddenly found that love with hundreds of millions of dollars of hard-earned money piled up "brand monument" is actually made of sand, let people a foot can collapse. Those originally covered in drawers of the case have also emerged from the water, some debt collection enterprises in the local court have rushed to the town of Shengzhen, Shandong Province to enforce, Zhuhai court also once the office building of Ado was seized. Among the explosions that followed Ho Chi-psalms for years were the generals who marched eastwards for years. Unable to understand the financial situation, they do not know what happened to the company, where the bomb was buried, and who detonated it, there will be no new explosions, Edo and themselves have no tomorrow. This group of "China's first generation of professional managers" self-proclaimed young elite does not seem to have signed a life-and-death covenant with the "master", soon, the deputy general manager of marketing left, the minister of electrical sales left, the minister of after-sales service left, integrated marketing communications director, planning minister, audio equipment marketing manager also left, once let the industry's awe-made love of the young elite team in a blink of an eye.
In the past few years, Chen Tiannan has not been involved in any business affairs, the outside world does not even know that such a large shareholder exists. All personnel appointments, financial management and day-to-day operations of Edo are under the full responsibility of Ho Chi-th, and Chen Tiannan is largely unhinged. With the prosperity of Ado's cause, the estrangement between the two major shareholders is increasingly built, Ho Chi-ming's mental imbalance is conse you can think of, and Chen Tiannan joked that he is "watching others dance through the glass." In 1998, Ho Chi-th, who had always prided himself on "not playing cards by card", made several measures that Chen Tiannan could not bear. First of all, Lin Ying, who is in charge of Edo's finances, blocked Chen Tiannan's message, and then completely set aside Chen Tiannan's equity settings in several subsidiaries, such as video equipment and audio, to declare "property rights reform". This in Chen Tiannan's view is very likely to transfer assets to start a new stove. It is in Edo and other enterprises to negotiate brand rental such a matter of enterprise fate, Ho Chi-peuge and Chen Tiannan did not discuss, so that the latter as soon as they learned of this amazing news, they immediately made the strongest response. In a "lawyer's statement" on April 7, Mr Chen claimed that all of Ado's new subsidiaries had not been authorized and approved by the board of directors and that all of its operating activities and debt claims were not related to Guangdong Edo Electric Co., Ltd. The "lawyer's statement" undoubtedly sent a striking signal over the Chinese business community: something happened to Ado. Dealers and suppliers who have been distracted by Edo's arrears run madly to Zhongshan, and the media everywhere smell the blood of prey. Qinchi after the new standard king in the end can go far is already a suspense of the news topic, as early as March 1st, Edo because of the off-season reasons to stop broadcasting CCTV ads have made everyone excitedly guess for a while, this "lawyer statement" out, is undoubtedly their own door-to-door news dinner. Ho Chi-buo has always been the founder of Ado and when the family, in fact, with his contribution to Ado is indeed no one else, but put into the capital structure to consider but this is not the case, he only accounted for 45% of Ado shares, when Chen Tiannan and Yilong village united, he had no choice but anger. After 20 days of tough negotiations, Mr Ho was forced to step down as chairman and general manager, and the new king abstranded after more than a year of coronation. At this time Edo has become the world of debt collectors and journalists. Almost overnight, dozens of reporters turned Ado from the roof to the bottom of the building, and various articles exploring the "Love tragedy" appeared frequently. Always proud of the media planning Ho Chi-wan did not expect, is those who stood in front of him yesterday singing praises, and now is the first to throw stones at him. Those days he was most afraid to read the newspaper, he suddenly found that love with hundreds of millions of dollars of hard-earned money piled up "brand monument" is actually made of sand, let people a foot can collapse. Those originally covered in drawers of the case have also emerged from the water, some debt collection enterprises in the local court have rushed to the town of Shengzhen, Shandong Province to enforce, Zhuhai court also once the office building of Ado was seized. Among the explosions that followed Ho Chi-psalms for years were the generals who marched eastwards for years. Unable to understand the financial situation, they do not know what happened to the company, where the bomb was buried, and who detonated it, there will be no new explosions, Edo and themselves have no tomorrow. This group of "China's first generation of professional managers" self-proclaimed young elite does not seem to have signed a life-and-death covenant with the "master", soon, the deputy general manager of marketing left, the minister of electrical sales left, the minister of after-sales service left, integrated marketing communications director, planning minister, audio equipment marketing manager also left, once let the industry's awe-made love of the young elite team in a blink of an eye. This was followed by a dramatic repetition. On May 6th, more than 20 days after being pulled from the throne of general manager, Ho Chi-peso successfully "recovered" under the support of some merchants, Chen Tiannan promised to sell shares at a price of 50 million yuan, Ando was once again in charge. On the same day, 82 dealers issued a joint statement, said to give Edo "full support and help." But the so-called "all-out" is only for fear that the money can not come back people together raised their hands and shouted a slogan. At this time, love is really to the point of exhaustion, even this originally published in the Sheep City Evening News life-saving statement because they can not pay advertising fees and finally stopped. On the fourth day of Mr Ho's re-appointment, more than 200 Aydo employees, who had not been paid for months, blocked the factory's doors, paralysing traffic on the national highway. In the same month, zhongshan municipal government's preliminary investigation and audit results of the company announced that Ado's existing fixed assets of 80 million yuan, inventory materials of nearly 200 million yuan, liabilities of 415 million yuan, not counting intangible assets, the company's insolvent amounted to 135 million yuan. In June, Ho Chi-bai and Chen Tiannan were placed under house arrest for two days and two nights by hundreds of Ado employees until Ho Chi-bai brought back 2 million yuan in cash to pay part of his salary. In July, Edo's talks with one of its biggest creditors failed. In August, Edo's last deputy general manager left. In December, the Zhongshan Intermediate People's Court accepted the case of Guangdong Ado bankruptcy and debt repayment by Dongguan Hongqiang Electronics Co., D.E. and other applicants, and Guangdong Ado entered bankruptcy proceedings.
It's a wall of shaw
Edo has never had any investment mistakes or excessive fixed asset investment problems. Edo's form of enterprise organization is very strange, in its own office, only one office building and several lines, fixed assets will not be more than 10 million yuan. Ado rely on contractual relations to organize a number of processing plants for it to make parts, a group of dealers for it to sell goods, it also to these two types of business financing, access to huge liquidity. It should be said that this is a very advanced and efficient mode of operation.
The shareholders' dispute between Ho Chi Minh and Chen Tiannan is bound to break out. A person who has made no contribution to the development of Ado simply because he invested thousands of dollars in capital, he has to share every penny with Ho Chi-sing, who has worked so hard all day, which is not fair to Ho Chi-pyo and all the people who love him. Edo's inadequate corporate governance system is not entirely Ho Chi-th's responsibility, but simply that his approach to the problem is not artistic enough and that he has caused some self-righteous intrigue.
the biggest thunder
The only problem that can cause fatal sudden suffocation is financial operations. The first possibility: there has been an unknown loss of huge amounts of money - Chen Tiannan's sudden attack on Ho Chi-rah, the biggest reason is that he believes that Ho Chi-peuge transferred Edo's huge assets. In this regard, due to the lack of solid factual disclosure, we are unable to conduct in-depth discussion. The second possibility: and perhaps the most reviewed, is that Edo's financial system is so fragile that it can't stand any wind and rain. Like all private enterprises, financing difficulties have always been one of the problems that plague Edo. Ho Chi-pak came up with the up-and-down business fund-raising method can be said to be a genius idea, but later, with the scale of the enterprise snowball-like expansion, new financing channels have not been opened, resulting in enterprises to the business of increasing dependence on funds, the original a very pleasing game hard is to let Ho Chi-pak play dangerous. In fact, when the 200 million yuan deposit is in place, Edo is fully capable and qualified to enter into certain financing contracts with financiers, for the company's financial balance tied to a "safe rope", and then, in the market sales exceeded more than a billion yuan, corporate efficiency and brand effect of the best time, Ho Chi-peo has a better chance to build his financial insurance system. Unfortunately, Ho Chi-po has always been too confident, and the pursuit of "zero inventory, zero debt" false name, and thus missed a good opportunity. According to Edo's old department, Edo's financial management is very confusing. Journalist Sun Yuhong in the "wind and rain love more" has described: Ho Chi-pek almost do not know how much money he has, also do not know how much foreign debt he owes, he usually rarely with the financial department to study payment priorities, but also often the account of cash as a profit. He believes in the operating creed is "the wealth of the people gathered, the wealth of the people scattered", the words are good, but reflected in the business activities are big hands, the concept of cost control is poor. Ho Chi-peso's disregard for financial management is also reflected in Edo's talent structure. Ho Chi-pak opened the door, Guangna Junjie, its marketing advertising talent, but is the only one who is good at financing and capital operation
The root cause of the failure
The history of the growth of China's private enterprises has repeatedly demonstrated the principle that the biggest threat to a start-up's growth after it has passed the market development stage is a lack of proper financial attention and a lack of a proper and effective financial system. A private enterprise without a stable and effective financial security system is like a car without a seat belt and airbags speeding on the highway, the faster the development of enterprises, the higher the degree of success in the market, the greater the risk of its lack of financial forward-looking.
It makes sense, but it's mostly deaf to a group of entrepreneurs who sell as kings
One formula that Western economists once offered was that for every 40-50% increase in sales or orders, new businesses would grow faster than their capital structure, and that companies would generally need a new, different capital structure. Experts also suggested that a growing start-up should realistically plan its capital needs and capital structure three years in advance, preferably according to the maximum possible demand.
Getting to 30 percent is going to get noticed
One formula that Western economists once offered was that for every 40-50% increase in sales or orders, new businesses would grow faster than their capital structure, and that companies would generally need a new, different capital structure. Experts also suggested that a growing start-up should realistically plan its capital needs and capital structure three years in advance, preferably according to the maximum possible demand. Love.
In September 1995, Duan Yongping abruptly offered to resign. His explanation for his resignation was: "Development is limited and opinions are divided." "And it has been observed that Duan Yongping aspires to be a real entrepreneur, wants to be China's Li Ka-shing, wants to make a business into China's Panasonic, but in the little bully is impossible." On the one hand, Yihua Group, which is above the enterprise, has been taking away the profits of the little bully, making it less developed, and on the other hand, Duan Yongping's proposal to reform the shareholding system of the little bully has been repeatedly rejected. Duan Yongping went to Dongguan Chang'an Town, across the river from Zhongshan, and set up Step High Electronics Co., Ltd. When he left Xiaoba Wang, he took away the "four kings" of the Development Department and the assistant general manager, the Minister of Export, the Minister of Domestic Marketing, the Minister of Engineering, the Minister of Planning, the Minister of Production, the Chief of the Finance Section, the Minister of Logistics, the Minister of Supply, the Minister of Storage... Almost empty the middle class and put them in similar positions in the new business. The little bully was thus hurt.
Draw a salary at the bottom of the kettle
After losing Duan Yongping, the little bully quickly fell into the dark abyss. First of all, a large number of backbone employees followed Duan Yongping out together, and then in 1997, the 24 dealers of the little bully and collectively went high. Just over two years later, the little bully has been dismally withdrawn from the first echelon of home appliances competition.
The choice of general manager is crucial
Is there a common "professional personality defect" in the failure of Chinese entrepreneurs? The answer is yes. Lack of moral sense and humanistic care, lack of respect for law and order, and lack of systematic professionalism is a more contoured explanation. These are almost "innate", with strong characteristics of the times, "professional personality defects", so that a generation of grass-roots entrepreneurs often into a strikingly similar fate in the rotation. Enterprises often suffer fatal crises as a result of certain defects in the professional character of decision makers, and it is likely to conclude that the "occupational personality defects" of a generation of grass-roots entrepreneurs are the ultimate cause of their collective elimination. Therefore, "overnight collapse", it seems sudden, but it is a syndrome of the inevitable burst, it has the internal causes of the system, there are external causes of the environment, there are deep-seated human factors.
Innity is not enough, blind self-confidence the day after the day after
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