---
title: "Dong Mingzhu: There Are No Secrets to Sales, Only These Two Words!"
description: "At a summit on FMCG internet transformation, Dong Mingzhu, chairwoman of Gree Electric, shared her philosophy that integrity and win-win cooperation are the keys to success. She recounted how Gree narrowly avoided being sold to a foreign company in 2004, and how she transformed the company through strict management and institutional reforms."
author: "New Distribution"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
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published: "2016-09-23"
categories: "Dealer Operations"
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---

# Dong Mingzhu: There Are No Secrets to Sales, Only These Two Words!

> At a summit on FMCG internet transformation, Dong Mingzhu, chairwoman of Gree Electric, shared her philosophy that integrity and win-win cooperation are the keys to success. She recounted how Gree narrowly avoided being sold to a foreign company in 2004, and how she transformed the company through strict management and institutional reforms.

30+ industry experts, 100+ B2B platform founders, 800+ manufacturer and distributor friends, gathered in Fuzhou to discuss the internet transformation path for the FMCG industry.
People say I am a marketing expert and marketing queen, but in fact I have no secrets, only two words—integrity. You must ensure that your distributors and partners win together with you, so that others will trust you and listen to you. If we always think about our own interests, your decisions will never be realized.
**Gree Was Almost Sold Back Then**
In 2004, we had a very intense battle. At that time, there was a big trend in China: whichever city could attract a Fortune 500 company would be considered remarkable. Zhuhai was eager to have a Fortune 500 company settle there.
They set their sights on Gree Electric. At the end of 2004, our sales were 13.8 billion yuan, still very small compared to Fortune 500 companies. The government was eager to make this happen.
Personally, what benefit would acquiring Gree Electric bring me? The condition offered to me was an annual personal income of 80 million yuan, while my salary at Gree Electric was only a few hundred thousand yuan. Later I thought, even if Zhuhai had a Fortune 500 company, it wouldn't be Chinese, let alone created by us.
On the contrary, through years of effort, Gree Electric had already achieved some success and found its rhythm. Although we faced challenges, I felt we were very confident.
My dream was that one day we would create our own Fortune 500 company, so I strongly opposed the sale. But the Zhuhai city leaders wanted to sell, so I went to the provincial government to report my reasons for not selling.
China's Zhonghua toothpaste was very famous, but today it no longer exists. It was acquired by a foreign company. The same people, the same materials, but it's not our brand anymore. Of course, I gave many other examples. At the time, the provincial leaders didn't respond, and I thought I was done for.
But not long after, an investigation team was sent, and after the investigation, they decided not to sell. In the 10 years from 2004 to 2014, we grew from 13 billion to 140 billion yuan, and finally entered the Fortune 500 with our own brand. The best part is that we weren't at the bottom; we ranked 385th.
In the competitive home appliance industry, we are number one in the world. This is our pride for China, and it is our responsibility as entrepreneurs to do such things.
If we had sold then, it would have been for 900 million yuan. How much tax revenue would our country have received? What benefits would our shareholders have had? Last year, we gave shareholders a dividend of 3 yuan per share, with a 10-for-30 bonus issue, the best in the history of listed companies. This year, we also did a 10-for-10 rights issue.
I want to tell a small story. 13 years ago, when I walked into the Great Hall of the People, I said the air conditioners used here are not mine, and I must make them use our air conditioners. Shouting is useless; why should they use yours? Your technology must be better than others, then they will use yours.
Over the past 10 years, we have meticulously researched technology, cultivated talent, and designed the strategy for a century-old enterprise. So we finally entered the Great Hall of the People with our own strength.
**Institutions Matter More Than Numbers**
In the development of Gree Electric, from 100 million yuan in 1991 to 140 billion yuan in 2014, it's not just a change in numbers, but more importantly, a change in the system.
Our numbers can look good in an instant, but that is often unsustainable. If you want sustainable development, you must work on the system.
In 1995, Gree Electric made a big move: institutional construction. At that time, we faced the biggest dilemma: the entire marketing team left collectively.
Because Gree Electric gave them too little compensation—a commission of 0.8%. But a neighboring air conditioner factory gave a commission of 5%. Does that company exist today? No, it's gone.
So, many of our staff and subordinates act for profit. An enterprise must establish a good system so that ambitious people have good development opportunities on this platform (conversely, when choosing a career, you shouldn't look at how much money the company gives you, but whether the company's culture gives you opportunities and conditions for development).
When the company faced this problem, they asked me to come back. I was reluctant at the time. In 1994, Gree made 460 million yuan, and I alone made 160 million. That year I received a bonus of over 1 million yuan. Coming back to be a department head with a salary of 100,000 yuan, I didn't want to return from any angle (everyone has a little selfishness).
Moreover, coming back as a department head means offending people. But on the other hand, if the company goes under, can I still do sales? So after thinking for a long time, I decided to come back.
Furthermore, I think that no matter how much wealth a person has, if you can't let more people share in the wealth you create, then your wealth creation has no value.
When I came back as department head, I was shocked. We talk about coastal areas and Guangdong being frontier and open, but at that time our company was even more severe than state-owned enterprises inland: there were no rules or standards of behavior among personnel.
Everyone knows about the anti-corruption campaign now. People think corruption is a government problem, but that's wrong. There is corruption within enterprises too. When I was department head, I found our corruption problem was very serious. I think it's not only where there is power that corruption exists; where there are transactions, corruption may exist.
Our company had obvious peak and off seasons. In the off season, no one picked up goods, so our people sat there drinking tea, some even brought snacks from home to chat, spending the day leisurely and elegantly without any pressure.
Many people hope to have no pressure, but that's wrong. A person's life must have pressure to be meaningful. Without pressure, there is no meaning, because with pressure there is a spirit of challenge, and you can achieve success.
If everything comes easily, that's not a challenge. The joy of success from things easily obtained has no value.
At that time, Gree Electric didn't have direct nepotism, but there were many friend and acquaintance relationships. First, represented by the top leader, the executives themselves didn't realize it, but the people he brought from Guangxi thought they had such backing and could do whatever they wanted.
Gradually, an atmosphere formed where everyone thought this person can't be offended, that person can't be offended, and everyone was acting by observing others' expressions. Do you think such an enterprise has hope?
At that time, when people mentioned Gree Electric, they only said two words—too dark. Even to get a job at Gree Electric, you had to pay money, and even the porters were corrupt.
With corruption (transactions) at different levels, how could the brand image rise? I used a very simple method: I worked on the system, hanging the standards and requirements for each position on the wall. Everyone's first task every day was to check their own behavior against the standards.
I set a rule: no eating during work hours, no lateness in the morning. My office had transparent glass, and I watched them every day, so initially we solved the lateness problem.
But regarding eating, everyone thought I was just talking. One day, they were eating when I saw them, and just then the bell rang for the end of the shift. I asked them, "When you were eating, did the bell ring?" So each was fined 50 yuan.
At that time, the highest salary for logistics staff was 800 yuan (in 1995), so 50 yuan was quite painful for them, and they all begged for mercy. I said no, it must be fined, and the one who brought the food was fined 100.
This matter seems simple, but it immediately changed everyone. Up to now, they absolutely don't bring food to the company.
Is this small matter important for enterprise development? Very important! Details determine success or failure. If we don't pay attention to small matters, over time they become big matters. When an enterprise has a big problem, it's even harder to fix.
Because I was strict in management, I established a discipline inspection office. It's a system of positive and negative energy, but when you promote righteousness, most people will support you.
This was the first thing I did. Now let me talk about the second thing.
At that time, our general manager brought a person from Guangxi (now retired) who was responsible for issuing invoices, and he could issue them to anyone he wanted. After I returned, I immediately audited his accounts and found major problems. So I set a rule: the person issuing invoices has no authority to decide who gets the goods; only when finance notifies you to ship to a certain customer can you issue the invoice. This system restrained him, and he couldn't fake it or engage in relationships.
To be honest, whether intentional or not, people brought by leaders should be held to higher standards. That was the first thing to do.
Later, a distributor who had no money got the goods shipped, while another who had money in the account didn't get the goods. I didn't accept any of his explanations; all reasons were invalid. If it was a mistake, it was negligence; if intentional, it was even more serious.
I fined him 100 yuan (his salary was 800 yuan). I don't know how many transactions he had behind, but 100 yuan might not matter to him, but face matters, right?
So whenever a problem occurred, it was reported throughout the company. When I reported this, others thought, "Dong Mingzhu is tough; she even dares to touch the general manager's people." It caused a reaction across the company, and everyone thought Dong Mingzhu was awesome.
People think I am combative, and indeed I am. If you don't fight, how can you? If you don't fight these behaviors, then you are the same as them, and what's the point of coming back as department head?
After reporting this matter, I demoted him one grade, meaning he would earn 80-90 yuan less per month for the rest of his life. He was very anxious.
At that time, some said, "Dong Mingzhu, you should handle people's issues slowly. Be careful; if you make it too big, it will be bad for you." I thought, I'm not dealing with personal matters; I'm building the enterprise's system. Why should I go slowly?
I predicted that the boss would definitely call me. Sure enough, the next morning he called me over. I told the general manager, "Why would I fight against you? What I'm doing is protecting the enterprise's interests (which is protecting your interests). Do you know? It's not me against you; it's him against you. Do you know what the subordinates are saying? If employees lose confidence in the enterprise, can the enterprise still talk about development? Can it still talk about survival?"
**Learn to Win Together**
There is a saying: "The desireless are strong." I have no desires or demands. If you ask me to do something, I will do it well. I use my power fully and properly. Besides internal adjustments, external adjustments are also needed.
From the time I became department head, I required all distributors to pay before picking up goods. This policy was opposed by everyone, saying, "What era is this? Dong Mingzhu dares to ask people to pay before getting goods? What if they don't pay? Then there will be no sales for a year."
Later, I told them a simple truth: 99% of people in the world are alive. You must look at the market and the people with a positive attitude, and you will be very happy.
After this policy was introduced, it was decided that goods could only be shipped after payment. Many protested, but protests were useless. I told them, "The county official is not as good as the current manager." Today, I am the department head, and I have the final say. After this decision, it immediately changed Gree Electric's operating model: all distributors must pay before shipping.
That year, our company had a net profit of 100 million yuan (1995). It should be said that from that year on, the whole situation changed. In the past, we were followers; suddenly we became controllers.
In the past, we relied on bank loans, but because of this model, Gree Electric grew from 4.2 billion yuan in sales in 1997 to 140 billion yuan in 2014. From 1997 to now, we have not had a single cent of bank loans. Now many small and medium enterprises say they lack funds most. You are wrong. What you lack is not funds; you lack management, you lack systems, and you lack finding the right partners.
New Era · New Distribution
— 2016 China "FMCG + Internet" Summit Forum —
**This is a grand event focused on how the FMCG industry channels should transform under the trend of Internet+ transformation**
**Conference Agenda**
09:00-09:30 Registration
09:30-09:35 Host opening
09:35-10:05 2016 China FMCG Industry Trend Analysis Report — Zhao Bo
10:05-10:25 FMCG Enterprise Transformation Strategy and Path — Liu Chunxiong
10:25-10:45 Opportunities and Challenges Brought by FMCG Channel Reform — Liu Zhao, CEO of Waiqin365
10:45-11:25 Alibaba Retail Link All-round Empowerment — Guo Kunkun, Alibaba Retail Link
11:25-12:00 Roundtable Forum — Brand Transformation: Improvement vs. Reconstruction? (Guests TBD)
12:00-13:30 Lunch
13:30-14:00 Distributor Transformation: City Distribution Trend Development — Wang Qi, CEO of Weijie City Distribution
14:00-14:30 Roundtable Forum — Why Should Distributors Do Logistics in Transformation?
14:30-15:00 Detailed Explanation of Zhongshang Huimin's "One Machine, Two Wings" Strategy — Su Xiaoxin, Vice President of Zhongshang Huimin
15:00-15:30 Detailed Explanation of Zhanghe Cloud Factory Strategy — Yang Lixiang, Zhanghe Tianxia (Content TBD)
15:30-16:00 Supply Chain Finance: Lubricant for B2B Driving Traditional Business — Chen Xian, CEO of 51 Order
16:00-16:30 2B Investment Principles and Ideas — Xu Xiaoping, Founder of ZhenFund (Guest TBD)
16:30-17:00 Small Retail, Big Business Opportunities: China Retail Transformation and Upgrade — Wang Jianfeng, General Manager of E-commerce Division, Yurun Group
17:00-17:30 Roundtable Forum — Who is the King of FMCG B2B Models? (Guests TBD)
18:00-20:00 Dinner
For manufacturer and distributor friends who want to transform, this grand event is not to be missed. Interested friends can long-press the QR code below or click "Read Original" to register.
**Registration Method: Long-press the QR code below or click "Read Original"**
↓↓↓ Click "Read Original" [Register]


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## Citation metadata

- Publisher: New Distribution
- Author: New Distribution
- Published: 2016-09-23
- Canonical: https://xinjignxiao.com/en/articles/dong-mingzhu-there-are-no-secrets-to-sales-only-these-two-words-b7e74dcb/
- Original source: https://mp.weixin.qq.com/s/s-etbroImdZtsRQRsKOC6Q

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