Abstract: as the world's top five hundred enterprises of the Haier Group, its chief executive, will naturally appear frequently in various high-end international conference, Harvard Asia business conference in Shanghai Jinmao Tower in Pudong is held ceremoniously, Haier Group Zhang Ruimin did a wonderful speech:
Eric Harwit: the following speech is Haier CEO Zhang Ruimin.
Zhang Ruimin: Ladies and gentlemen, good morning. Very glad to attend this annual meeting, I think at this meeting I speak at my own experience, is now the China enterprise pays close attention to very much or more confusing two problems. One is that after joining WTO, Chinese enterprises, especially for Chinese home appliance enterprises positioning and orientation, second are Chinese enterprises on how to implement the internationalization strategy.
I think the first problem is that all Chinese enterprises must answer the question, that is the past our position and direction are mainly to the domestic market, now I think we should locate to the international market, our direction should be able to participate in the competition of the international market mainly. I want to ask this question, is not you want to do, nor can you do the problem, but you must do, if be no room for survival. Because after the accession to the WTO, suddenly a very big change, is the integration of two, is a domestic, foreign market integration, is a domestic, foreign competitors integration. In fact, we say that is not ready for the contest entries, is in front of us. For example, we have not obtained the Olympic qualifying games, but top players have to our country.
Today four Nokia, Sony, Philips, Kodak high-rise, today we are in one speech, but we want to compete. But how can I compete with them? They are the teacher class. I just graduated from high school, not on the University, how to compete with him? But he is not the Olympics, very fair, insufficient qualification not participating, this matter, you run your he will compete with you.
20 years ago I started this business, Philips in my mind is a God, then we what business? Just six hundred small street plant, and I was working, half the time everywhere to borrow money paid each month. When I entered the factory for them to develop the first rules, is not in the shop anywhere. Like Philips Nokia, the super big business, they will think of these situations? But today I have to participate in this competition, so I want to say second questions, that is in this case, Chinese enterprise how to carry out the strategy of internationalization? I think the country proposes that Chinese enterprises should implement the strategy of going out, but I think that the Chinese enterprises should go into a trilogy, the first is to go out, second should be entered, third should be to go up. I want to say, go out like a person out of the country, go out and learn their advanced experience, or study abroad, or to do business, this should be called out. But this is far from enough, you should go in, it is as if a man, where I get a green card, I become a local resident, I think this should be walked in. Finally, should saying is to go up, this is the purpose, that is to say me into the local mainstream society, I can for local contributions, but also by the local people welcome.
I think the first problem: what to rely on to go out? Many people think that Chinese enterprises to go out is on China's cheap labor, low cost, I think this is China going out an advantage, but today has not a unique advantage, because all of the large multinational companies to come to China, they can get and you too low cost. So I think going out, in addition to the advantages, you must have the advantage of poor dissimilation. The difference is in the local establish credibility, or specifically the reputation reflected on famous brand, if not famous, you can only stay in others do employee's level, and the processing cost is very low, you may not have a profit, nor is it possible to develop.
So we and other Chinese enterprises adopt different strategies, we take the first easy, first to the developed countries to developing countries. China general enterprise thinks, Chinese enterprise competitiveness not, first to the Southeast Asian countries to go to developed countries, but on the contrary, why? I said I in developed countries can withstand the test, can participate in the competition, and then to the developing countries to have no problem. So this is what we made two more outstanding achievements. The first is that we have now is enterprise of Chinese home appliance exports, its own brand most. Second is the outlet can be benign and rapid growth. The first half of this year we have more than the same period last year increased by 100%, that is to say half over the last year the export.
Second problems that the go on the basis of how to go in, become a local enterprise. In 99 years, we in the United States, South Carolina to build a plant, was then subjected to a lot of questions. The media has an article entitled five words" to remind Zhang Ruimin", why to remind me? China has not any enterprise in the United States of America do factory successfully, what you can be successful? I want to remind late, again a bit earlier, I would not go. But there is no way, has gone, so the first year, second years of deficit, can now slowly without loss. But there is no such questions, I questioned them, because China is subjected to anti-dumping complaints than any other country. Because only in domestic production and export this way, must go. But was only accessible to the local factories is not enough, must also be entered into the local circulation. So we in the United States must be into the American ten big electrical appliances chain stores, now we have all been in. Last July 5th, the United States of America home furnishing a news magazine, Haier and Harriet cooperation in the United States Manhattan Harriet square had a activity, this activity is the result of seven hours to sell seven thousand air conditioning. This message is reproduced to home after is a question, not, never, in China is not likely to sell so many air conditioning. Later someone asked, on average one minute to sell 16 units, how likely? But I told him, this is the commercial secrets, and I can't tell you. So the most important, I think it is not that went in, went in also must go to the user to allow the user to identify with your heart. Now I think it to do better, I now 22 overseas factories, but there are nine factories without me a penny investment, but also willing to give me, because I have a lot of orders, they agree with me this brand, I have many orders, he has a lot of production capacity, I let him come to me to do the processing.
Finally, go, go, the final purpose is to go to, that is to say in local fully accepted, become a local famous brand. We present a called the three into a record, is the local finance, local agents, local culture, how to make our culture and local culture together? The final purpose is a noninvasive, is a local consumer recognition of a world famous brand. This is very difficult, I in Germany when attending a dinner party, a company manager 's wife also went, I asked her, did you know that Haier? She says that, in Germany has sell. I said, will you buy? She said that I will not, I will certainly buy music. I said why? She said music for me is not an electronics, it is a work of art. So this is what I thought, like people, two individual difference as long is very good, degree is very high, but it is a better than B, why? Because of his temperament. Haier to go abroad now belongs to this, very hard, but temperament. How to solve? I want the user to buy certain is not a product, must be a solution. If we give you create needs, I can provide what you want, you solve the problem, I will succeed. For example, in the United States in the United States, we create a wine cooler, in past years in the United States cabinet in only two place, one is in the big house or in the cellar, and one is placed in the apartment, put the wine in the kitchen, but we developed a living room type wine cabinet. This will meet a lot of demand for middle class, turned into a big market. But the market is like saying I am not your original cake cut in one piece, but I made a cake, I can be myself this cake. Now many of our competitors to follow, to make the market, even so, we still hold the market share of more than half of. Entering the Japanese market, we all know that Japan is a household appliance power, is a household appliances export country, Japanese countryman to foreign brands is difficult to identify, so we want to measure how the Japanese people outside of the brand identity. The only way is to do better than you, or something you are not. In Japan, the washing machine is generally a wave wheel, is actually three kinds of washing machine impeller, Japan, European roller, the United States is stirring type.