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Negative growth for more than one year: Excavator agents' reshuffle is imminent

negative growth for more than one year: Excavator agents' reshuffle is imminent

current construction machinery information in China. Chen Mo is an excavator agent. He began to sell Korean Doosan excavators before 2000. At present, he is the general agent of a province of Doosan. As of July, the company has paid more than 9million yuan in advance, which is a real advance

for more than 12 years, Chen mo (a pseudonym) has never encountered such a dilemma

Chen Mo is an excavator agent. He started selling Korean Doosan excavators before 2000. At present, he is the general agent of a province of Doosan

"as of July, the company has paid more than 9million yuan in advance. It can't afford to pay in advance, so we can only consider quitting." Chen Mo told that agents like him can be found everywhere in the field of excavator sales. In the face of the overall industry difficulties, his advance fund scale is small, "some agents advance nearly 100 million yuan"

according to the statistics from the excavator branch of China Construction Machinery Industry Association, although the sales of all types of excavators in 2011 increased by 4.1% year-on-year, this data has been falling sharply year-on-year since May 2011 - from January to July 2012, the domestic sales were only 76225 units, down about 39.88% year-on-year compared with 126784 units in the same period last year

Since 1992, China's national economy has undergone four major macro adjustments in 1998, 2004, 2008 and 2011. Chen Mo has experienced it three times

"the adjustment time in 2004 was very short, and we can see that the adjustment came suddenly and went quickly. The adjustment time in 2008 was long, but the adjustment range was relatively stable. However, the current adjustment, which began around August and September 2011, really can't see to the end." Chen Mo said

in order to deal with the dilemma, Chen Mo tried many methods

the first is to increase the proportion of down payment. The general sales method in excavator industry is that excavator manufacturers outsource sales and services to agents, who sell or lease to end customers. However, driven by the once booming domestic infrastructure construction investment, thousands of agents of nearly 100 excavator brands often reduce the down payment ratio to attract customers in the face of high industry gross profit in order to grab customers

in a prosperous year when the economy is growing and the excavator owners can make money, this strategy is no problem. However, once the excavator owners can't make money, they can't even pay the "monthly payment". In order to keep their brand agent qualification, agents often have to use their own funds to pay the monthly payment for the excavator owners

Chen Mo is no exception. But now, in order to control the risk, he will carefully identify the customer's qualifications and strictly implement the agent policy of 10% down payment

the second is to collect the monthly supply or even take back the machine

"when the market is good, the agent will help the customer pay the down payment in advance, but now the market is very poor, and it is very difficult to recover the down payment after 3 months' advance - the machine purchased by the customer either has no work to do, or the construction fund cannot be recovered after work. Even the monthly payment has become a problem, so it is more difficult to recover the down payment." Chen Mo said that in order to reduce risks, after some customers delayed repayment for more than six months, he took back nine excavators for self leasing. But the problem is, in the face of the stagnant market demand for leasing, Chen Mo's risk is even greater - all the debts owed by the brand manufacturer have become the agent's own; The rental rate of the recovered machines is not high, and the rental fee can not be recovered after the machines are rented out for work

there is no way. Affected by the decline of subsidies, Chen Mo has to start to advance funds and lay off staff. His company has been cut from more than 60 people at the peak to only more than 20 people

"it's been a year, but I can't move any more." Chen Mo said

industry integration

as the category most closely related to the development of the national economy in the construction machinery industry, the demand for excavators is often the leading indicator of economic prosperity, and its highly positive correlation with the investment in fixed assets is even considered as high as 90%

Masahiro Sakane, President of Komatsu Manufacturing Institute, the world's second largest construction machinery enterprise, in his book Komatsu model, quoted the data of the American Equipment Manufacturers Association (CIMA) and pointed out that in the 1990s, there were five important factors affecting the performance and precision of electronic universal testing machines: the demand for construction machinery in the markets of Japan, the United States and Europe basically accounted for 80% of the world's total demand, Around 1990, when Japan's economic foam reached its peak, Japan alone accounted for 40% of the world's demand for construction machinery

at present, China's construction machinery market demand accounts for more than 40% of the total global market demand, and China is known as "half of the global construction machinery market". According to the statistics of Cima, in 2000, the Chinese market accounted for only about 20% of the global market

obviously, the monthly sales of excavators have continued to decline year-on-year since may2011, which fully indicates that the integration of China's construction machinery market, especially the excavator industry agents, has come

there are not a few excavator agents like Chen Mo who are ready to quit. Among them, Doosan has a relatively large proportion of agents who are going to quit. The former "big brother" of China's excavator market is facing a key reshuffle

large R & D investment "before Komatsu, Doosan once ranked first in the sales list of excavators in China. In 2011, Sany's sales surpassed Komatsu. After the local excavator manufacturers in China accounted for about 40% of the market share, Komatsu still had nearly 10% of the market share, while caterpillar had a slight increase of nearly 10%. It is not surprising that Doosan's sales fell." An industry source who declined to be named said

"The integration of the industry is bound to come, and the first is the integration of agents. In fact, the withdrawal and integration of agents have always existed, and they have changed with the development of the industry. This is just a rational choice between manufacturers and agents, which is a normal business behavior. A few years ago, the domestic construction machinery market grew too fast. At present, the overall situation is in trouble. Just like people, it is impossible to keep running at a high speed and the steady growth of the industry The long stage has come. " Fengguiying, Secretary General of the agent working committee of China Construction Machinery Industry Association, said, "agents can not advance money for sales. Manufacturers and agents must work together to tide over the difficulties and jointly deal with the current cash flow shortage and inventory risk."


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