The following is the speech delivered by Mr. Zhou Bin, co-founder and COO of Renwoxing Technology, at the 5th FMCG + Internet Conference hosted by New Distribution, organized and published for readers. I borrowed the catchy line "There are many roads, but supply chain comes first" from the popular sci-fi movie The Wandering Earth during the Spring Festival as the theme of this sharing. There are actually many ways for enterprises to transform and upgrade, but what is the most important? Today, we will focus on the most important one: supply chain, and share our views and opinions. Next, I will share some cases on how we specifically implement and use SCM new business technology to empower traditional brand owners or distributors. Renwoxing (Guanjiapo) has always advocated technology-driven applications, and applications create value. How to implement entity enterprises + Internet, helping traditional enterprises upgrade rather than disrupt. Part One: There Are Many Roads for Transformation and Upgrading Many friends have learned about many related products and solutions through various conferences. It seems there are many roads for transformation, but they don't know how to choose. Returning to the essence of business, no matter what you transform, ultimately consumers have to pay, and downstream distributors have to pay. The core of the entire business essence is to return to products and supply chain. Only by optimizing the supply chain and reducing costs can value be highlighted. The supply chain determines whether the business makes money and how long it makes money. The supply chain is the bottom line to adhere to. So how to upgrade the supply chain and realize digital and internet-based platforms? 1. Stick to yourself and practice internal skills In the past two years, we have constantly heard various new terms, such as PC Internet, then mobile Internet, then mobile social e-commerce, new wholesale, new retail, new business, and 5G, artificial intelligence, cloud computing, big data, etc. A string of terms keeps entering our minds. Sometimes traditional business owners are confused: How should I go? Why is business so difficult? In the face of new terms, we must stick to our main business, understand what can be used for me, look inward, not just see what is happening outside. While adapting to the times, we should see our own growth. Instead of chasing new trends, it is better to cultivate hard-core capabilities internally and improve our internal skills. 2. Make greater connections and symbiosis Don't think about making money alone. Today's business model is "all for one, one for all." It's not about defeating opponents, but uniting more people to empower. After Double 11 in 2018, Tmall CEO Zhang Yong posted on Weibo that Alibaba would use AI technology to fully enter the industrial Internet. During the recent Two Sessions, Ma Huateng also mentioned making the industrial Internet the C-position event of Tencent's overall strategy. What six hard-core capabilities should enterprises possess? Among them, the key is to build supply chain integration capability and industry chain IT capability. In terms of supply chain integration capability, relying on dataization and technology-driven, reduce costs and improve efficiency. When terminals are more willing to sell your goods and there are more orders, more brand owners will come. This is the law of attraction: do yourself well, and others will come, rather than seeking relationships and begging. The integration of the supply chain in the future will use online collaboration to achieve win-win. Regarding the IT capability of the industry chain, some people say that entity enterprises should develop and build systems themselves, not use third-party technology providers. I think it depends on the stage of the enterprise. For example, some distributors think: I am just an ordinary distributor, I just want to make money, how can I build a system? Some large brand owners think: I can support a group of people to focus on products and service channels. I have also seen many enterprises that spent millions on hiring people to develop systems, but the people left, the money was spent, and the system was never developed. So it depends on the stage of your enterprise, especially each enterprise must find its own core competitiveness. What is its core product? If I am a B2B platform, my competitiveness is the platform, talent, and capital. Take Renwoxing as an example. As a technology provider, our core is to accumulate industry-wide technical experience to form products, helping enterprises transform and upgrade at a lower cost to achieve digitalization. In short, focusing on product value is the foundation of survival, and upgrading digital capabilities is the way to development. Enterprises say it's difficult every year, this year is more difficult than last year, but it's like that every year. At this time, especially pay attention to long-term development, sustainable development, sustainable cash flow, and gross profit. Part Two: Digital Supply Chain Comes First 1. Internal informatization of enterprises. As one of the top three enterprise information management software providers, Guanjiapo has accumulated millions of distributor customers and merchants. Over the past 20 years, we have done one thing: moving offline operations to the PC side, completing the informatization of finance, purchase, sales, and inventory on PC, emphasizing internal management and manual data entry. 2. External digitalization of enterprises. What is the relationship between digitalization and enterprises? Future digitalization will more guide how to acquire customers and take orders. After receiving orders, it automatically enters purchase, sales, and inventory, then the warehousing system, then the logistics system, and finally completes the entire closed loop of the transaction, forming a full-chain digitalization. Future digitalization is not internal digitalization of enterprises, but the connection of the entire external upstream and downstream, focusing on doing business, automatically obtaining data rather than manually inputting data. The future business form must be online and offline integrated, driven by data rather than human tactics. Here are some tools to share with you. This is a masterpiece of Renwoxing's 20 years of experience: the SCM new business technology platform solution. As shown above, if you are just a distributor with many downstream stores, you can use our B2B tool. You can call it an ordering system, but it is actually called the new wholesale system, which is Renwoxing Kuaima New Wholesale. For example, a company in Fujian that does imported wine wholesale reached a daily turnover of 300,000 yuan within seven days of going online, and now basically achieves a daily turnover of one to two million yuan. Previously, when using traditional ERP management, many offline stores ordered through salespeople by phone, then reported orders to backend business personnel who manually entered them into ERP. The entire process only solved internal purchase, sales, and inventory management, not external visual ordering and full-process digitalization. Now, through the Kuaima New Wholesale system, it mainly solves six major needs: online mall and offline ERP integration, downstream procurement through visual ordering mall, warehousing system integration, salesperson management, member customer management, marketing management, and financial management, all in one online ordering. This is actually a new business integrated digital solution, no longer a simple ordering solution, especially suitable for distributors and brand owners facing downstream ordering scenarios. As shown above, this is a multi-supplier to multi-orderer model, mainly solving the integration of multiple suppliers' sources to provide one-stop ordering services for downstream. You may have seen this ad: Huang Bo endorsed Zhengyi Chicken Steak with over 16,000 stores. Originally, they only solved their own logistics warehousing and distribution. Now they have started resource integration, helping many food ingredient suppliers on their chain do distribution, using Renwoxing Yunliushui multi-merchant B2B. Now the annual sales of the food ingredient supply chain exceed ten billion. Therefore, for warehousing and logistics providers, supply chain integrators, professional wholesale markets, or business associations, etc., with a large number of upstream and downstream resources, this solution can be used to achieve supply chain transformation and upgrading. Here are the highlights of this innovative technical solution: The entire system architecture is scalable and flexibly split, allowing enterprises to solve supply chain transformation needs in stages. It helps enterprises solve information islands in informatization and digitalization construction, as well as short-term costs and long-term expansion issues; staged implementation solves the problem of not investing too much in the short term, and scalability solves the pain point of not having to overturn the original system and start from scratch when upgrading the business model in the medium and long term. Part Three: The Second Road of Industrial Internet The definition of the industrial Internet includes four aspects: 1. Connect everything. For example, WeChat mainly connects people to people, while the industrial Internet connects people to enterprises, enterprises to equipment, equipment to software, connecting customers to retail stores, retail stores to distributors, and distributors to brand owners. 2. Commercial Internet. Previously, it was the consumer Internet, such as Taobao and JD.com. The next opportunity and blue ocean are in the industrial Internet. The industrial Internet includes the commercial Internet and the industrial Internet. Today, we focus on the commercial Internet, such as new wholesale, new retail, and how to achieve full-chain digitalization. When doing the industrial Internet, we are not blindly following trends, using tools just because others do. The most important thing is to understand: today, doing the industrial Internet and dataization, on the one hand, reducing costs equals making money, improving efficiency equals making money, and gaining more customer experience lies in increasing stickiness with customers; on the other hand, more importantly, whoever builds a digital platform first has the first opportunity to establish a new ecosystem. Because everyone now understands the significance of platforms, they are all developing apps, micro malls, and mini-programs. When everyone installs them for small shop owners, small shop owners will definitely not install all of them, and they may uninstall many after a period of use. At this time, it depends on who lays out first. In the future, doing the industrial Internet is about grabbing customers and laying out the ecosystem first. This is the most critical thing in the digital competition, and also the key high ground that many people have not yet seen. In the future, whoever has the right to speak will go further. Over the past year or so, we have contacted many brand manufacturers. They are particularly touched by this. In addition to opening stores on Tmall and JD to show presence, they are more aware of one thing: after hard work for 20 or 30 years, their channels must be controlled by themselves, and their own territory must be decided by themselves. They cannot hand over their resources and data to third-party platforms. They understand that they must digitalize channels, empower downstream roles, and achieve symbiosis and co-creation, that is, "all for one, one for all." This is the state of future business games. It is predicted that 2019 will be the first year for most brand manufacturers to build digital supply chains. 3. Industrial Internet. That is, digital collaboration in production planning, manufacturing coordination, raw material procurement, R&D design, etc. 4. New ecosystem big data. That is, platform thinking and data value. In the future, the most valuable are data assets and ecosystem stickiness. In the industrial Internet, "connection" is the starting point, the commercial Internet and the industrial Internet are the footholds, and "data" is the end point. The commercial Internet landscape JAT (JD, Alibaba, Tencent) is all playing; there are also leading brand enterprises, such as Coca-Cola, which is also doing digital transformation; and regional large distributors, such as our customer Yibin Lvyuan Group, which is using our supply chain system to connect downstream retail stores and upstream manufacturers. Now, almost everyone is building a stage. Speaking of building a stage, many people think that building a platform is very expensive. If you play pure e-commerce with a platform, it is indeed. But if you are doing entity + Internet, you don't need to burn money. Entity + Internet only needs to move offline stock to the online first, and after forming habits, then do increments. Drive business dataization through data value, and finally turn data into business, so that all people, goods, and places are "known in mind." This business model is mainly implemented in stages and iterations. You can first do B2B wholesale, or do the entire full-chain F2B2b2C integration from manufacturers to downstream, or do F2B2b or B2b2C (also called S2B2C), and finally achieve F2C or C2F. Recently, I served several well-known domestic trademarks and large brands, which also occupy more than 60% absolute market position in the industry. They did one thing: originally, in addition to selling their own brand sources, they also wanted to open their channels to brand owners of related products, selling other brands' hot-selling sources to downstream distributors and terminals, empowering channels with sources, systems, warehousing and logistics, and capital, helping downstream make money and reduce costs and increase efficiency, forming downstream stickiness while further consolidating their ecological status. With a huge offline channel cultivated for decades, any brand owner wants to enter and share a piece of the pie. At this time, as long as their own brand or other brand hot products are put on the shelves, they can instantly reach the mobile phones of distributors, retail terminals, and consumers. Distributors and retailers can purchase without pressure to stock up, only need to display samples online and offline. As soon as consumers buy, the backend brand will ship on their behalf, relying on the original offline distribution channel to revitalize the entire existing traffic. As shown above, brand owners can quickly release new products, distributors and retail terminals enrich categories and add new profit points, consumers directly benefit from good brands and high cost performance, truly realizing the F2C factory direct sales model that has been proposed for many years, and all roles benefit. Therefore, once the channel digitalization of the future industrial Internet is opened, new business models and gameplay will emerge endlessly. Finally, how to combine your own resources to do your own products well, practice your internal skills, and achieve digital transformation and upgrading. I give you two words: The first is to upgrade the main business. Don't envy others. Just iterate layer by layer and consolidate yourself. The second is long-termism. Be an unkillable cockroach at one point. For example, distributors become tenacious and deeply cultivated people in the region, and brand owners do the orderly iterative upgrade of industry channel digitalization and supply chain digitalization. Chinese enterprises are too large. Through communication with nearly one million customers of Guanjiapo, we found that no matter how small the enterprise or category, it can succeed in China. As long as you keep up with the digital trend, find a good technology partner, upgrade the main business, and persist in long-termism, the spring of entity + industrial Internet is coming. -END-