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Editor’s Note: This article comes from the Business Review of Entrepreneurial State column. Author: Harris, general manager of Ningbo New Oriental Industry and Trade Co., Ltd., author of Cross-border E-commerce 3.0 Times.
As a senior entrepreneur in the field of cross-border foreign trade and e-commerce, my entrepreneurial experience has exceeded 14 years in 2020, and I personally experienced SARS in 2003. Therefore, I have deep experience and many feelings about the operational difficulties brought by the ongoing new pneumonia epidemic to small and medium-sized entrepreneurs.
At the same time, as a business operator for 14 years, he has his own thoughts on how enterprises face adversity and how entrepreneurs overcome it. Therefore, writing this article, I hope I can bring you a little value and enlightenment.
In the past few days, I have seen many complaining articles of big coffee in the circle of friends. The most widely circulated one should be the "frankness" of Jia Guolong, chairman of Xibei Catering.
He said that at present, more than 400 Xibeimen stores in more than 60 cities across the country have basically closed down, leaving only more than 100 take-away businesses. He predicted that the company would lose 700-800 million yuan in revenue in one month before and after the Spring Festival. Even if the company lends money to pay wages, it may not last for three months …
Under the epidemic situation, most industries seem to be wailing.
As a start-up enterprise, we are also experiencing the operating pressure brought by the pneumonia epidemic, and also have our own business thinking and experience.
I will truly present the business situation and sales model of an ordinary small and medium-sized enterprise under the epidemic situation, and hope that some of our practices can bring more entrepreneurs thinking.
We are a foreign trade cross-border e-commerce entrepreneurial enterprise, and the categories we currently operate are handicraft toys and pet series.
Our sales are basically through online mode. Overseas markets mainly sell through Alibaba International Station, AliExpress and Amazon platforms, while domestic markets sell through e-commerce platforms such as 1688, Taobao, Tmall, JD.COM and Pinduoduo.
Since February 3, we have fully entered the working state. The working mode we choose is online work, and remote collaboration is carried out through Alibaba nail and WeChat group. In the foreign trade circle, the SOHO model has always existed, so our team is very familiar with online office and the efficiency is very high.
Our sales department has counted the current sales data and trends of the company. In addition to the short-term fluctuation of sales data of cross-border retail platforms, domestic retail sales have increased, and it is expected that there will be a sales peak after the fifteenth day of the first month. We are also optimistic about the sales data of domestic e-commerce channels in 2020.
Therefore, under the pressure of this pneumonia epidemic, our company’s overall sales are good, and its work efficiency is also very high. Not only has it not been affected, it is likely to usher in a high-speed development period.
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We have a community of 70,000 entrepreneurs. For business and economic impact, everyone is struggling these days. Many people are very pessimistic and even plan to give up their startups. Many people have also asked me why your company’s operation is relatively healthy and even can continue to develop at a high speed under such an epidemic.
First of all, I think we are just an ordinary foreign trade venture, but we did do something right, and I have always adhered to my business philosophy.
I have always believed that the higher an enterprise’s Internet level, the higher its IT level, the more dominant it is in the crisis, and the better its business operation.
1. Online and digital sales channels.
As an entrepreneur of Alibaba’s ecosystem, all our channels are online.
The reason why our domestic retail data continues to grow is because the residential economy has become the mainstream under the epidemic.
Everyone stays at home and never goes out. Once the express logistics is restored, the demand for online procurement will naturally erupt unprecedentedly, so we are not worried about the sales data at all.
We have a DIY sailboat model product, which has been selling flat for some time. Recently, this toy turned out to be an explosive product against the trend, and it sold well in Tmall and 1688.
Our sales team communicated with the buyers. It turns out that at the moment of the epidemic, many people stay at home, and urban white-collar workers have the habit and trend of DIY making toys, so buy a DIY sailing model toy and experience the fun of doing it quietly at home.
The sales team summarizes itself. Under the omni-channel online mode, we are most likely to perceive consumers’ trends and consumption ideas.
Internet genes make a traditional manufacturing enterprise like us have super-sensitive market sense and perception ability, which makes the enterprise more competitive and flexible in the crisis.
2. Short video marketing is more active.
As the epidemic continues, everyone stays at home, and Tik Tok, Aauto Quicker and bilibili have become the main forms of entertainment for many people, so short video marketing is naturally more popular.
We laid out short video marketing at the end of 2018, and there are corresponding teams working on platforms such as Tik Tok, Aauto Quicker and bilibili, so our marketing data is not affected by the epidemic at all.
Our DIY toy models all need video tutorials. The young company will make their own toy models after 90 s and 00 s, and then post the videos on the platform.
Not only that, they will also interpret some short video stories and integrate the products well. For example, a girl bought a DIY model toy for a boy, and then a love story happened. These short videos have always been very popular.
The persistence of this epidemic has brought continuous traffic growth to these short-sighted frequency bands, which will naturally lead to our sales platform, and the sales data of DIY model toys will soar accordingly.
3. Cash flow has strong backing.
Judging from the current epidemic development, the impact on the operation of startup companies may be more than three months or even longer. In such a special period, cash flow is equal to the lifeline of the company. Whoever has abundant cash flow can live better in such a crisis.
For our company, cash flow is very healthy because we are in Alibaba ecosystem.
On the one hand, our own e-commerce sales data has not been affected. On the other hand, the Alibaba ecosystem has various financing services for SMEs, so we are not worried about cash flow at all.
At present, we have four stores in Taobao and Tmall, and one of them has a daily sales flow of nearly one million. Through the online financial service of "advance payment" of Alibaba’s online merchant bank, these sales streams can be received online within 1 minute, and the interest on procedures is very low.
Under the pressure of the epidemic, we are also strictly controlling the company’s cash flow. Years ago, the online orders of overseas customers at Alibaba International Station were tens of thousands of dollars. Through the "running loan" products of Alibaba International Station, we can receive the money in a few minutes and become a capital reserve.
This is hard to imagine for many traditional offline foreign trade companies. It takes about 3 ~ 6 months for them to place an order from the customer to finally get the money back.
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4. Working online is the norm.
In the foreign trade circle, SOHO office has always existed, especially with office collaboration tools such as nailing and enterprise WeChat, the efficiency of online office is actually very high.
Since the second day of the first month, our employees have been working online through nailing, WeChat, etc., and reached normalization on the tenth day of the first month. They punch cards online, assess KPI online, trade online and reply to customers.
Compared with foreign trade enterprises, internet enterprises and media, more ordinary startups are still unfamiliar with online home office. Many bosses are worried about how to evaluate employees’ work efficiency and performance after working online from home.
In my opinion, under the trend of Internet, the boss should have such a company philosophy: "Gather a group of like-minded people and do one thing together under one value." The company is not owned by the boss alone, it is a common platform for everyone to survive and develop, and everyone participates, coordinates and shares for one thing.
Therefore, our company introduced the amoeba model very early. Different teams have their own projects, their own compensation systems, and even their own equity ratios.
Under the relatively perfect KPI system, we seldom assess the superficial performance such as punching cards, but pay attention to the results, such as the sales data of salesmen, the design results of designers and the operation data of operators.
With such a business philosophy and a standardized and meticulous KPI system, in fact, working in a company is essentially the same as working at home.
5. The team is stable and confident
Our company is composed of small teams, and excellent small teams participate in the distribution of the company’s equity. We also implement the partnership system. Therefore, for employees, the company is that everyone does one thing together. Under such a company philosophy, the more in times of crisis, the more people hold a group, the more frustrated and brave they are.
At the same time, in the face of crisis, entrepreneurs should first give the team confidence, prospects and even faith; Secondly, further strengthen the stability of the team. For example, let the team know the real situation of the enterprise, let the team enter the working state as soon as possible, and really care about the employees.
At the early video meeting, I will tell you the company’s sales data truthfully. Although the epidemic situation is current, our sales are still hot, and everyone is naturally full of confidence.
Under the epidemic crisis, if the team takes a long vacation, it is easy to be distracted. On the second day of the first month, our employees went to work online one after another, and on the tenth day, all of them arrived at their posts and entered the working state. The whole team, Qi Xin, worked together to make sales and promote development, and maintained its indomitable spirit.
In order to make employees feel a sense of belonging and security, we set up an epidemic prevention and control care team to provide epidemic prevention supplies to employees and conduct certain safety training. We also try our best to keep employees’ posts, and encourage everyone to tide over the difficulties and fight the epidemic with the company through meetings and team sharing.
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I shared some practices of our company on how to break through the business dilemma under the pressure of epidemic situation. Of course, different start-ups will come from different industries, but I think the general trend and direction are the same. In addition, there are some suggestions for entrepreneurs.
1. Establish a positive entrepreneurial mentality.
Since we choose to be an entrepreneur, we should have a strong entrepreneurial mentality. When the industry is facing adversity and the enterprise encounters crisis, it can better reflect the outstanding ability of an entrepreneur.
An entrepreneur is a captain. At such an extraordinary moment, we should have the courage to lead the team and inspire everyone’s morale. This is a qualified entrepreneur.
As entrepreneurs, we should spread positive energy. To truly believe in the power of the government, the government’s control of the epidemic has been highly praised all over the world, and we must also establish confidence and firmly believe that the epidemic will eventually pass.
2. Make a rational business evaluation
We conservatively estimate that the epidemic will affect the economy for more than three months. If you don’t have enough cash flow and you are a micro-entrepreneur, you should consider cost control and survival crisis.
If you figure out that the company will not have any income in the next three months, and there are no other smooth financing channels, then take immediate measures to control costs, such as layoffs and collection of accounts receivable. If the financial pressure is very great, we should rationally choose to quit and stop operating.
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3. Reflect and improve yourself
The epidemic crisis has kept everyone from going out, but it has given us time to think calmly. In fact, such adversity is the best time for entrepreneurs to reflect and improve themselves.
As entrepreneurs, we need to improve our ability to cope with crises, especially to exercise our entrepreneurial adversity quotient, learn to judge macro trends and make micro-innovations.
Entrepreneurs can also use this period of time to think about and resume their own operations, check and fill gaps, improve the company’s system and optimize the team. Under the crisis, danger and opportunity coexist, and if handled well, crisis is often the best opportunity for entrepreneurs.
4. Integrate into the entrepreneurial ecology
As a business operator for 14 years, I have recently been thinking about why we can develop well in this crisis. I think one of the core reasons is that the entrepreneurial circle we are in has a strong ecological advantage.
Alibaba Eco-Entrepreneurship Circle provides entrepreneurs with very rich resources and empowerment, such as sales platform, financing channels, online office software, as well as various training and sharing opportunities. Through the entrepreneurial circle, mutual encouragement and mutual learning, the vitality and growth of entrepreneurs have been maximized. This is the core reason why an ordinary entrepreneur like me has grown up for 14 years.
Of course, the entrepreneurial ecosystem is not only Alibaba, but also Tencent and Meituan. However, no matter which ecosystem you are in, I want to emphasize that you should really integrate into your entrepreneurial ecosystem and let yourself achieve sustained growth and success through ecological empowerment.
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Churchill said, don’t waste any crisis.
For entrepreneurs, we are never short of crises. In the process of starting my own business, I have experienced SARS, the financial crisis in 2008, the internal mechanical transformation, and the business crisis.
However, entrepreneurship itself is a practice and promotion, and the best opportunity for promotion is crisis after crisis. Going through the crisis, overcoming the crisis, realizing transformation and growth, this is my experience in dealing with the crisis in my 14 years of entrepreneurship.
Finally, I sincerely hope that the epidemic will end as soon as possible and everything will get better and better.
This article is published by Entrepreneurial State authorized by the columnist, and the copyright belongs to the original author. The article is the author’s personal opinion and does not represent the position of the entrepreneurial state. Please contact the original author for reprinting. If you have any questions, please contact editor@cyzone.cn.
