Chapter 33 4. Let the whole world trust Gree

Gree's goal is to pursue the number one in the world.Gree has long proposed to be an internationally recognized Chinese brand, but how can we achieve this goal? Now many people think that we export a lot and earn a lot of foreign exchange, which is naturally a good thing.However, no matter how much foreign exchange is earned through export, if it does not rely on its own brand, it cannot be called an international enterprise.China is a big country in the use and manufacture of air conditioners, and leading brands in the air conditioner industry should be born on the land of China no matter from which point of view.The goal of Gree Electric Appliances is to occupy 25% of the global household air conditioner market. We will eventually make people all over the world trust Gree air conditioners, just like people trust Mercedes-Benz and BMW.Dong Mingzhu believes that participating in international development is the only way for enterprises to develop, and only in this way can Chinese enterprises truly become stronger internationally.Gree Electric very much hopes to participate in this kind of international competition and cooperation, and hopes to truly "go global" through international competition.In exploring overseas markets and building Chinese brands, Gree Electric has taken cautious and firm steps.

All beginnings are hard.Anyone who understands the international market situation knows that it is not easy to change the image of Chinese products.At that time, the international industrial manufacturing product market was dominated by foreign brands, and most Chinese air-conditioning companies were emerging companies, and were affected by the environment of low quality and low prices of domestic brands, so their brand awareness was not high.And brand cultivation is by no means a one-off thing. The cost investment is very large, which is beyond the affordability of ordinary enterprises. If you want to make a breakthrough in a short period of time, OEM (OEM) is a shortcut to "curve to save the country".Therefore, at that time, Gree Electric took full advantage of its competitive advantage of low manufacturing cost, and successively obtained OEM orders from many multinational companies such as Panasonic, Daikin, Whirlpool, Carrier, and Siemens.With this move, the quality of Gree's OEM products has been unanimously recognized by the cooperative manufacturers, and the export volume of Gree's own brand has gradually increased, thus successfully entering the international air-conditioning market. The OEM production also gave Gree the opportunity to improve itself Advanced production technology and management level, and gradually familiar with and mastered some international competition rules.Taking the road of internationalization requires understanding the rules of international competition.

International competition emphasizes on products as the forerunner. Therefore, Gree always adheres to high standards and strict requirements in terms of quality, which is the first method Gree found in its journey to enter the international market.There is a very vivid example to illustrate this point.One year, a hotel in Italy purchased and installed more than 30 Gree air conditioners. Within three months, some rust spots appeared on the shell of the fuselage, and the hotel owner unceremoniously asked to return the products.The owner's thinking logic is very simple. In a few months, the rust spots on the casing will spread, so they have no confidence in whether the air conditioner will still work after a period of time.

Originally, rust spots on the fuselage casing would not affect the operation of the air conditioner at all. In China, this matter would often be settled by persuading customers to accept it, but the earnestness of foreigners taught Gree a lesson: the road of internationalization must be followed International cards are played.For this reason, Gree's decision-makers made up their minds to replace the shell materials of all products with double-sided galvanized sheets. Although this alone increases the procurement cost by tens of millions of yuan every year, it has won the favor of all customers. trust.After mastering a certain degree of "water quality", Dong Mingzhu realized that the method is only a phased choice during the growth period of the enterprise after all. Chinese enterprises must rely on their own brands if they want to go global in the end.An independent brand is not only a symbol of a product, but also the backbone of a country's national industry, carrying a country's industrial civilization and commercial culture.China is a big producer of home appliances, but it is not a strong country. It is weak because it has no independent brands.Therefore, in the process of going international, it is very important to have an independent brand, and Gree is not satisfied with only doing OEM for others.Gree Electric has gradually promoted its own brand in export products since the day it started making products.Every year, more than 3% of the technology research and development costs are extracted from sales, making it the company with the highest investment in China's air-conditioning industry. It is these technological innovation investments that have enabled Gree to rise and completely ended the situation where the air-conditioning market was dominated by developed country brands.

At present, "Gree" brand air conditioners have been exported to more than 60 countries and regions.Someone once asked the heads of some well-known domestic enterprises, what is the goal of business operation?The answer is: the market share of the brand, especially in the current international market where productivity is already in surplus, and all countries with open market economies have entered the buyer's market to varying degrees. In this case, the main means for enterprises to win is not only the product itself It is no exaggeration to say that brand is a powerful weapon for enterprises to enter the market and occupy the market.Looking at Gree's development pace in the past ten years from 1994 to 2007, it can be said that it is precisely because of my country's participation in international competition and cooperation that Gree Electric can grow rapidly.

In 1994, Gree Electric only sold 300,000 air conditioners, with sales of only 800 million yuan, and all of them were sold domestically. At the beginning of the 21st century, after China's accession, Gree's sales and management have also undergone significant adjustments. In 2007, the sales of air conditioners completed 20 million units, achieving sales of more than 30 billion yuan, and the export sales alone achieved 6 billion yuan.In Dong Mingzhu's own words, this is the result of participating in international competition, "Participating in international competition is like a military training. As a competitive enterprise, we will never give up the domestic market, but we must go out and build an international Chinese brands at the highest level.” In addition, many companies have different opinions on the development model of Chinese companies after going global, and their approaches are different.The approach of some domestic manufacturers is to "invest in the construction of factories first, then develop the market", while Gree pursues the model of "establish the market first, then invest in the construction of factories".The success of Chinese enterprises "going global" depends on whether they can create more wealth for the country and whether they can continue to be recognized by consumers. It is prudent and wise to consider investing in building factories when there is market demand. practice.India, Turkey and many other countries have asked us to set up factories, and they all have ready-made factories, but we did not go.I told them that there were risks, and risks that were out of my control.Therefore, we would rather produce from Zhuhai, export to sell there, and not set up factories until we feel that there is a need for this market.

There must be a market first, and when the market reaches a certain share and has a certain strength, we will consider building a factory there.Also out of this consideration, when faced with questions from the outside world about “why doesn’t Gree Electric set up factories in the United States, Europe and other developed countries”, Dong Mingzhu said: Air conditioning is a labor-intensive industry, and it can only Only the production in developing countries can be competitive and have advantages.Since 1998, Gree air-conditioning began to enter the Brazilian market. With the advantages of excellent product quality and complete varieties and specifications, it was soon warmly welcomed by Brazilian consumers. It achieved sales of more than 3 million US dollars in just two and a half months in Brazil that year. .After three years of hard work, by 2000, the sales of Gree air conditioners in Brazil had reached 30 million US dollars, becoming the second largest air conditioner brand in the local market.The broad market prospects prompted Dong Mingzhu to make up his mind to invest 20 million US dollars in Brazil to build a split air conditioner assembly plant with an annual production capacity of 200,000 units.The plant broke ground in Brazil in 1999 and officially started production in 2001.Later, with the further expansion of the market, Gree carried out another expansion. By 2004, the annual output of Gree Brazil had exceeded 300,000 units (sets), and realized a profit of nearly 25 million US dollars.Up to now, Gree Electric's sales outlets in Brazil have covered 24 states throughout Brazil, with more than 300 agents, more than 1,000 retailers, and more than 300 service outlets and installation companies.Gree air conditioners have successfully entered large supermarkets in major cities such as Sao Paulo, Rio de Janeiro, Santos, and Victoria with the advantages of complete varieties and exquisite technical workmanship, and set up exclusive counters.The Brazilian government has given priority to recommending Gree air conditioners to consumers, and also preferred Gree air conditioners in various government procurements, which has greatly promoted the establishment of a good image of China's home appliance boutique brand.For other emerging markets, Gree Electric also chose flexible penetration strategies such as "borrowing a boat to go to sea" or "borrowing a chicken to lay eggs" with its usual calmness.

In June 2004, Gree Electric signed an air conditioner export agreement with Whirlpool of the United States, and 40,000 air conditioners officially entered the Indian market. This is the largest order for a Chinese air conditioner company to export to India so far. In March 2005, the production line of Gree air conditioner in Pakistan was officially put into operation. Unlike the base in Brazil, the production line in Pakistan was invested and built by local distributors, and Gree Electric was only responsible for providing technical support and brand management.Dong Mingzhu believes that Gree does not know much about the Pakistani market. When the Pakistani market is successful, it can be acquired slowly and become the second overseas production base of Gree Electric.On the issue of building factories overseas, Gree Electric insists on taking one step at a time, moving forward steadily, and not rushing for success.Similarly, Gree did not immediately copy Brazil's successful model to developing countries such as India and Russia. Gree insisted on selling Gree-branded air conditioners through local distributors first, and did not consider investing in and building factories in these countries if the time was not ripe.Dong Mingzhu also believes that if an enterprise's export purpose is simply to pursue a breakthrough in export volume, or to earn national tax refunds by increasing exports, it is too short-sighted.A very important purpose of export is to let Chinese brands go to the world, and use brand image and word of mouth to promote the growth of air conditioner exports.Export enterprises should abide by local laws, consciously regulate the behavior of market competition, and ensure the interests of the entire industry.Brazil is the first step for Gree to go abroad and enter the international market. While continuing to expand sales in Brazil, Gree's next step is to expand sales in the South American market.It is hoped that "Gree" will let people all over the world know that China can produce the highest quality products through high-quality air-conditioning products, so as to change the perception of "Made in China" abroad.All entrepreneurs have the responsibility to make their own contribution to establishing a Chinese famous brand in the world.The pioneering spirit of the international market and the focus on product quality enable Gree air-conditioning to gradually find the feeling of international competition, and to make frequent efforts in independent innovation, so that Gree has become a world-class brand. The export has covered more than 80 countries and regions around the world, and has won a good and extensive international reputation.Today, if there are still people who regard Chinese products as scourges or rats crossing the street, the success of Gree Electric is definitely the most powerful response to such remarks.As Zhu Jianghong, chairman of Gree Electric Appliances, said: "In the tide of economic globalization, it is difficult for companies to find a shelter from the wind. If Chinese companies want to gain a foothold on the future stage, they must actively and bravely go abroad and actively participate in International competition. Only in this way can we build our own global competitiveness and China can give birth to a real world brand.”

The main form of competition in the international market in the future will be the competition of brands. The quality of brands will become a magic weapon for enterprises to win by surprise in the competition. Brand development is regarded as a limited strategy to open up the international market, gradually forming a system and driving the development of related supporting industries. develop.Gree, which has gone abroad, should also have a prominent status like BMW and Mercedes-Benz.Gree, which is going to the world, is still trustworthy. This future world famous brand is worthy of people's expectations.