Wen | Xianfeng Chuang (ID:xianfengk2vc), by Zhang Runtao
Core point of view:
1. 【 Macro Pattern 】The size of China’s automobile aftermarket is 1.2 trillion, which is about half that of the United States, but the number of auto parts manufacturers, auto parts distribution channels and maintenance service enterprises is twice that of the United States. On the whole, China’s automobile aftermarket is in the form of "ant market", and there are obvious opportunities for integration in all aspects.
At present, the core contradiction between supply and demand in the automobile aftermarket is not the inefficient matching of traffic, but the low efficiency of the supply chain of automobile parts and the low quality of maintenance services. Therefore, it is difficult for giants (Ali, Tencent, JD.COM, Baidu, Didi, Guazi, Manbang) who use traffic to bless the track to quickly end the war in a short time by means of user subsidies, and emerging startups can still break through with their own unique advantages.
2. [Opportunities and Methods]Driven by two forces on the demand side (a large number of cars leave the maintenance period+consumption upgrade) and three forces on the supply side (due to the mature productivity trained for OEM in Europe and America+excellent scale effect of China’s auto parts circulation channels+mature technical infrastructure of maintenance services), China’s automobile aftermarket will systematically spawn a variety of entrepreneurial-investment opportunities, and startup companies can learn from the 13 methods mentioned in this paper to create long-term value and become industry unicorns.
3. [Valuation System and Growth Timeline]Venture companies interested in contacting VC capital can aim at "becoming a unicorn of 1 billion dollars in 8 years" and benchmark the valuation system of listed companies in the US stock market, so as to push back their own business rhythm and team configuration.
When will unicorns come out of China automobile aftermarket? This is a topic that entrepreneurs and investors often discuss in the industrial upgrading track.
On the one hand, Auto Zone, Advance Auto Parts, O’Reilly and NAPA, the four major chains in the field of auto parts in the United States, stand at a market value of tens of billions of dollars, and there are unicorns with a market value of billions of dollars in the field of maintenance services, such as Monro Muffler Brake and Valvoline, but there is no listed giant in China that can compete with them in the same amount.
On the other hand, Internet giants such as BAT/ JD.COM/Didi have been exploring the post-steam for a long time, and star startups such as Kangzhong/Batulu/Kaisi have also been in the post-steam battlefield for many years. However, at present, the whole post-steam competition pattern in China is not clear, and new players are still eager to try with their own unique resources.
These two characteristics make new entrepreneurs and investors always reluctant to take their eyes off the automotive aftermarket in China.
This paper tries to analyze the present situation and future of China automobile aftermarket from the perspective of Top-Down — —
Part.1 The Market Size and product-service categories of automobile aftermarket are presented in an overview;
Part.2 This paper systematically analyzes the competitive pattern of automobile aftermarket from three aspects: macro supply system, core track players and giant layout.
Part.3 This paper introduces the macro trend that affects the automobile aftermarket, and gives 13 "tricks" to achieve the unicorn after automobile in the future;
Part.4 From the perspective of capital market, this paper shows the valuation system of post-automobile companies with examples, and discusses the method of reversing the growth timeline of enterprises based on this.
I hope this article can bring some reference value to entrepreneurs, industry professionals and friends who are concerned about the post-steam industry, and welcome friends who are interested in this topic to exchange and discuss.
I. Market Size
In 2018, the automobile aftermarket in China is about 1.2 trillion, including 780 billion auto parts (65%) and 420 billion maintenance services (35%).
Automobile aftermarket size = car ownership × average car consumption, divided into two core elements — —
1. Car ownership
In 2018, the number of cars in China was 240 million (including passenger cars and commercial vehicles), with a growth rate of 10.6% (the number of new cars in 2018 was 28.08 million, down 3% year-on-year). Although the number of new car transactions declined, the overall number of cars will continue to rise in the future.This data can also be confirmed from the car ownership of thousands of people — — As can be seen from the figure below, China’s car ownership of 1,000 people is not only far lower than that of developed countries such as the United States and Japan, but also lower than that of many developing countries, and there is still room for increasing car ownership in the future.
The number of P.S. cars with 1,000 people depends on population density, economic level, public transportation level and other factors, so I won’t analyze them here. The above large numbers are only for reference.
2. Average car consumption amount
In 2018, the average car consumption of China Automobile for maintenance was about 5,000 yuan; This variable is positively related to the average age of cars. At present, the average age of cars in China is 5 years, and it will inevitably increase in the future.
Based on the two basic driving forces, namely, the increasing number of cars in China and the increasing age of cars, it is expected that the future automotive aftermarket will be in the growing trillion-dollar volume for a long time.
Second, product & service category
The final deliverables in the automotive aftermarket include [auto parts] and [maintenance services].
1. Auto parts
Auto parts refer to all the parts that make up a car; According to the maintenance or replacement cycle, auto parts are usually divided into two categories: [wearing parts] and [whole vehicle parts] — —
① Wearable parts
Wearable parts refer to accessories that must be repaired or replaced after a certain mileage or time. Typical categories of wearing parts include: engine oil, gearbox oil, brake oil, tires, engine oil filter, air filter, air conditioning filter, gasoline filter, spark plug, antifreeze, brake pads, brake discs, etc.
② Complete vehicle parts
Whole vehicle parts refer to the parts that must be repaired or replaced after an accident. Typical whole vehicle parts include: engine, bumper, gearbox, oil cylinder and so on.
Due to the numerous manufacturers of various brands, and the characteristics of many cars, models and models under each brand, the number of SKUs of auto parts is huge — — At present, the average SKU of automobile spare parts is about 30,000, and the overall SKU of automobile spare parts is more than 50 million. This is a huge SKU volume for a single industry, but looking at the breakdown of wearing parts and whole car parts categories:Wearable parts are universal (for example, different models can share the same specification of engine oil), so the effect of collecting orders is obvious for players who are trading platforms, and they are relatively suitable for self-operation; The universality of the whole vehicle is weak, so the effect of collecting orders is not obvious for players who are trading platforms, and it is relatively suitable for third-party infrastructure (Marketplace, logistics, supply chain finance, etc.).
2. Maintenance service
Maintenance service refers to the human service of automobile parts maintenance or replacement and beauty care. Usually, the maintenance or replacement of beauty care and wearing parts is a high-frequency service item, and the maintenance or replacement of whole automobile parts is a low-frequency service item.
At present, the size of China’s automobile aftermarket is about 1/2 that of the United States (the car ownership of the two countries is similar, but the average age of the car in the United States is twice that of China+), but the number of auto parts manufacturers, auto parts distribution channels and maintenance service enterprises is twice that of the United States — —On the whole, the post-steam market in China is in a relatively scattered "ant market" form, and the quality and efficiency of products and services are uneven, so there are obvious opportunities for integration.
First, the macro supply system
Because there are two core factors in China: ① few car owners master maintenance technology and ② low labor cost, 95% of maintenance services are provided by 4S shops and repair shops, and only 5% of car owners will choose to repair their own cars; Therefore, [automotive aftermarket] has also formed two core circulation paths based on this:
A.4S shop system (accounting for 20%): auto parts manufacturer authorized by the main engine factory → Main engine factory after-sales department → 4S shop → Consumers;
B. Independent post-market system (accounting for 75%): &rarr, an auto parts manufacturer not authorized by the OEM; Agent → Dealer → Auto parts city retailer → Repair shop → Consumers.
The following describes the basic status quo of three types of supply roles: auto parts manufacturers, auto parts distribution channels and service terminals — —
1. Auto parts manufacturers
① Auto parts manufacturer authorized by the OEM (original parts)
This kind of auto parts manufacturers have formed a long-term and stable cooperative relationship with automobile brand manufacturers, such as Denso in Japan, Bosch in Aisin Germany and Mainland China, which produce auto parts according to the design requirements of automobile brand manufacturers, put on the Logo of automobile brand and sell them to automobile brand manufacturers, and then circulate them to 4S stores.
Such manufacturers represent the most advanced supply chain level of auto parts in terms of quality and efficiency, and because of the profit margin requirements of automobile brand manufacturers and 4S shop system, the brand premium of auto parts of such manufacturers is often very high when they are circulated to consumers.
② Auto parts manufacturers not authorized by the OEM.
This kind of auto parts manufacturers can be roughly divided into three categories — —
Class A (factory parts): Class A manufacturers are completely auto parts manufacturers authorized by the OEM, but they sell another part of their production capacity to the independent post-market (without the Logo of the automobile brand), but the supply chain system behind them is exactly the same. Because the premium of automobile brand is removed, the price of such accessories in the independent market is 20%~30% cheaper than that in the 4S shop system, so it is the best choice for consumers in the independent market.
Class B (sub-factory parts): evolved from the foundry of Class A manufacturer. In the process of OEM for international brands, Class B manufacturers have mastered the skilled supply chain technology (especially in the more general consumable parts category). In order to expand their own revenue and profits, they often choose to create their own brands and sell them to the circulation channels of the independent market system. The quality and efficiency of Class B manufacturers in many auto parts categories are almost the same as those of international brands, so it is the second best choice in the post-independence market system.
Class C (spare parts): a "self-reliant" manufacturer that has no direct relationship with the auto parts manufacturer authorized by the main engine factory. Relying on the research of auto parts in the market and close contact with Class B manufacturers, these manufacturers indirectly mastered the supply chain technology of auto parts, and based on this, they created their own brands and sold them to the circulation channels of the independent market system. Class C manufacturers are weaker than Class A in quality and efficiency, but they can still meet the needs of most parts in automobile aftermarket service.
2. Distribution channels of auto parts
① OEM after-sales department
The after-sales department of the main engine factory is also the after-sales department of automobile brand manufacturers, which purchases automobile parts from authorized manufacturers and sells them to 4S stores at a higher price. Because the 4S shop has the brand premium authorized by the automobile manufacturer, and the automobile manufacturer decides the supply of auto parts in the 4S shop by policy instructions, the main engine factory often sells it to the 4S shop with a higher gross profit (the gross profit is higher than that of the same quality parts).
② Market circulation channels after independence.
After independence, the circulation channel of the market is consistent with the general commodity circulation system, mainly including three core links: agency, distribution and retail. The upstream of the whole circulation channel is the auto parts manufacturer authorized by the non-OEM, and the downstream is the repair shop. Because the repair shop has almost no brand premium, and there are many distribution channels in the domestic market after independence, the agents, dealers and retailers here often have relatively low price increase rates — — The gross profit margin of the distribution channel of general wearing parts is 20%~30%, and the gross profit margin of the distribution channel of whole vehicle parts is 30%~45%.
Note that the two types of circulation channels are now "merging", which is manifested in:
A. 4S shop purchases auto parts from independent market circulation channels.
The core reason is that the newly implemented "Measures for the Administration of Automobile Sales" in July 2017 allows some non-original parts to enter the 4S shop system, which enables agents, dealers and retailers who originally operated in the independent post-market system to serve as additional parts channels for 4S shops.
B the repair shop purchases auto parts from the 4S shop and the after-sales department of the main engine factory.
The core reason is that the operating performance of 4S stores has generally declined in recent years, and the liquidity of auto parts originally circulated in the 4S store system has declined, resulting in more inventory. In order to digest these inventories, 4S stores and the after-sales department of the main engine factory will sell them to repair shops.
3. Service terminal
① 4S shop
4S shop was first introduced to China by Guangzhou Honda in 1998, and now it has become the most important system in China’s new car circulation network. The two most important functions of 4S stores are: first, new car sales, and second, after-market service (mainly to undertake the maintenance service demand within the three-year maintenance period or a certain mileage maintenance period). According to the profit structure, about 20% of China 4S stores’ profits come from new car sales, and the remaining 80% comes from after-market service, which is equivalent to the profit structure of American car dealers.
② Repair shop
Different from the 4S shop, the repair shop will undertake the maintenance services of many brands of cars, and the repair price of the repair shop is relatively low due to competitive factors and weak brand premium (including auto parts and maintenance services are cheaper than those of the 4S shop).
China’s Ministry of Communications conducts certification examination for repair technicians in repair shops every year, but there is no strict high-standard system for qualification examination as a whole, so the overall service level of repair shops in China is still uneven (the service level < mean > can meet most of the automobile maintenance needs, but the variance < variance > fluctuates greatly).
It is worth noting that 4S stores and repair shops are excellent channels for selling automobile insurance because they have excellent customer resources, so many insurance companies will have a binding relationship with 4S stores and repair shops (M×N multiple binding relationship) and cross-sell each other’s products and services — — 4S shops and repair shops recommend car owners to buy a company’s insurance, and an insurance company will recommend car owners to the corresponding 4S shops or repair shops for maintenance. In essence, both parties can reduce the cost of obtaining customers by reusing sales personnel with each other.
Second, a list of core players in each segment of the track
The core players in the automotive aftermarket include — —
1. Auto parts
① Brand manufacturers
Representative manufacturers include: Bosch, Denso Japan, Magna International, Continental Group, ZF, Aisin Seiki, Hyundai Mobius, Lear, Valeo, Faurecia, Andoto, Yazaki, Panasonic Automotive Systems, Sumitomo Electric, Mahler, Yanfeng, Toyota Textile, Jettaggart, ThyssenKrupp, BASF, Fuyao Glass, Weifang.
Because of the high initial investment cost and fierce competition of brand manufacturers, there are no star startups within the range of VC.
② Circulation channels
A. Main wearing parts: three heads and six arms, Kangzhong Auto Parts, Haomeite, and Kuaizhun Automobile.
Due to the high consumption frequency of wearing parts and strong SKU reuse among different car series, almost all wearing parts channel players cut into the supply chain in the self-operated B2B mode, and the upstream purchases from brand manufacturers and the downstream sells them to repair shops. At the same time, they operate their own logistics system and focus on the delivery of the last 1km.
In the retail store opening mode, Kangzhong Auto Parts mainly adopts the direct operation mode, and the three-headed, six-armed, good-beautiful and fast-accurate auto clothes mainly adopt the joining mode, each of which has its own advantages and disadvantages — — The service quality control of direct marketing mode is relatively standardized, but the disadvantage lies in the slow speed of opening stores and the long-term accumulation to show the scale effect of supply chain; The service quality control of the joining mode is not standard, and it is usually easy to receive customer complaints, but the advantage is that it can borrow private capital to start quickly and show the scale effect of the supply chain in a short time.
B. Main auto parts: Batulu, Kaisi, Chetongyun, Zhongchi Chefu and Haohao Auto Parts.
The whole vehicle parts are completely different from the wearing parts, and their extremely low frequency, numerous SKUs and non-reusable SKUs between different vehicles make all vehicle parts channel players use the inquiry and quotation system (including "Vin code → Auto parts SKU "database)+third-party trading platform (that is, Marketplace) mode cuts into the supply chain, and the upstream docking agents/dealers/retailers, downstream docking repair shops or 4S shops (some players indirectly obtain customer repair shops or 4S shops through cooperation with insurance companies), and there are both self-operated and third-party modes in logistics.
Since the inventory of the whole vehicle parts in the market circulation channel is often unstable after independence, in order to ensure the supply adequacy of the whole vehicle parts SKU and the timeliness of logistics delivery, all kinds of players in the whole vehicle parts channel have also begun to try to "control the goods" on the basis of the Marketplace model — — For example, Batulu’s self-built multi-level warehouse requires suppliers to put the goods in Batulu’s self-operated warehouse and requires warehouse goods to only receive deployment instructions from the platform.
C. All-category management: harmony with steam, rapid development and saving.
All-category channel players are essentially a combined version of two types of channel player modes, namely, wearing parts and whole vehicle parts, such as Heqi — — The business model of its wearing parts category is similar to Kangzhong, and the business model of its whole car parts category is similar to Batulu and Chetongyun.
The distribution channel of auto parts is a battleground for China auto aftermarket, essentially because this track has excellent scale effect, and the current situation of China auto parts field with scattered upstream and downstream and high gross profit margin in circulation is just an excellent soil to make use of scale effect — — The scale effect in the distribution channel of auto parts can make the enterprise reduce the purchasing cost, warehousing and logistics cost while the sales volume is increasing, and then the gross profit margin is increasing.
Take Auto Zone (American stock code: AZO), one of the four major auto parts chains in the United States, as an example. The changes of its sales and gross profit margin from fiscal year 1990 to fiscal year 2018 are shown in the following figure. It can be seen that in the time span of nearly 30 years, the sales of Auto Zone soared from US$ 670 million to US$ 11.22 billion, and its gross profit margin also increased from 38.1% to 53.2% (while the stock price rose more than 40 times). In essence, it is because the OEM brand and upstream centralized purchasing have brought about a sharp decline in procurement costs, and the logistics and warehousing costs under the DC (Distribution Center)-Hub-Store system are also declining.
2. Maintenance service
Representative companies include: Tuhu Car Maintenance, Auto Superman, Xiaoju Car Service, Diandian Car Maintenance, Master De, Chexiangjia, cluster car treasure, Changtu Automobile, Youyishou, New Focus (A-share listed company) and Xiaomuzhi (New Third Board listed company).
The basic mode of maintenance service players can be summarized as "upgraded repair shop", which provides car owners with beauty care, auto parts replacement or maintenance services, and sells third-party or OEM auto parts at the same time..Tuhu Car Maintenance is a typical example. At the beginning, it cut into the market with the tire category of wearing parts, providing online trading and offline installation services for car owners, and gradually became the first channel brand and maintenance service brand in the tire category. At present, Tuhu Car Maintenance has gradually expanded its own auto parts business (expanding engine oil, filters and other categories) and maintenance service business (expanding automobile beauty care, wearing parts maintenance and replacement, auto insurance sales and other services).
There are also various companies with unique entry points in the automobile aftermarket, such as Youchelian, Yunka and Zhengda Fortis, which cut into the maintenance of commercial vehicles, and Vin code → Mingjue Technology, which is cut into the database of automobile parts SKU, is cut into the automobile parts agent and forms a strategic cooperation with Manbang, and is cut into the music match … Due to the limitation of space, I won’t describe them here, but it can be seen that the current pattern of China’s automobile aftermarket is uncertain and the innovation vitality is still very abundant.
Third, the layout of giants
In recent years, giants in the fields of Internet, offline retail, used cars, logistics, insurance, automobile OEM, etc. have been frequently deployed in the automobile aftermarket (as shown in the following figure) — — Take Ali as an example. After trying the "car terminal" business in 2016, in 2018, Tmall once again established the "Xinkangzhong" alliance with Auto Superman and Kangzhong Auto Parts. Behind these three giants, they respectively represent the traffic of car owners, maintenance services and the huge potential of auto parts supply chain.
From the above table, we can feel that after the giants inject ① owner flow, ② warehousing & logistics capability, ③ financial capability (insurance & payment & credit) and ④ original auto parts supply chain and service capability into the automotive aftermarket, it is not only a blessing to this track, but also a challenge to the existing players in the track.
However, it should be noted that the core contradiction between supply and demand in China automotive aftermarket is not the inefficient matching of flow, but the low efficiency of auto parts supply chain and the low quality of maintenance service — — Therefore, for the giants who use traffic to bless the track (Ali, Tencent, JD.COM, Baidu, Didi, Guazi and Manbang), it is difficult to quickly end the war in the automobile aftermarket by using user subsidies in a short time. A new automobile aftermarket system with wide customers, good quality and high efficiency needs to be watered patiently.
First, the macro trend
The future development of China’s automotive aftermarket will be driven by the following five important forces — —
1. Demand side
① China’s automobile aftermarket will be in a growing trillion-dollar volume for a long time, and as more and more cars leave the 4S shop maintenance period, more and more car owners will choose the independent aftermarket in the future;
(2) The increasing GDP per capita in China and the increasing professionalism of citizens in automobile knowledge will create the demand for high-quality chain service organizations, high-quality chain auto parts channels and domestic brands of high-quality auto parts;
2. Supply side
(1) Thanks to the long-term experience of OEM for European and American international brands, the supply chain system of China auto parts manufacturers is very mature, and they can provide auto parts with almost the same quality and higher cost performance as European and American international brands in quite a few categories, so it is possible to produce high-quality domestic brands of auto parts;
② The distribution channels of auto parts in China’s post-independence market system are currently in a large and scattered pattern, and the market share of Top-3 channel players is less than 1%; However, the auto parts track has the characteristics of positive scale effect, and several big head companies will be produced in the future.
With reference to the auto parts market in the United States, the overall market share of the four auto parts chains, Auto Zone, Advance Auto Parts, O’Reilly and NAPA, is more than 30% and is still rising. Due to the consistency of the supply chain attributes of auto parts, China auto parts channel companies will accelerate the appearance of scale effect when the infrastructure such as Internet, AI and logistics are mature.
(3) The development of automobile control unit networking, AR, Internet and other technologies will help repair shops greatly improve service quality and reduce service costs.
Second, 13 ways to upgrade the post-steam industry
Any industry, its direction of creating value mainly includes three kinds:
(1) better quality:That is, the products and services provided by the industry make consumers experience better;
② Higher efficiency:That is, the industry consumes less resources to deliver each unit of products and services, among which the core resources are money (cost) and time — — In the steady state (that is, in the state of non-burning money), the lower pricing limit of products and services provided by the industry to consumers is determined by the consumed cost, and the lower convenience limit is determined by the consumed time;
(3) get more customers:That is, the products and services provided by the industry can reach more consumers.
P.S. The value creation direction of an industry is also the lifelong struggle direction of all enterprises in the industry — — Whether the enterprise is in the production link, distribution link or the final retail service link.
Based on the five macro forces on the demand side and supply side of China automobile aftermarket, Combined with the players after China automobile, the four major auto parts chains in the United States (Auto Zone, Advance Auto Parts, O’Reilly, NAPA)& maintenance service unicorn (Monro Muffler Brake, Valvoline), the world retail giants (WalMart, Costco, 7-11), (4) observation of companies such as Amazon Web Service (WeWork) and venture capital enterprise (looking for steel net and intelligent cloth interconnection) focuses on the three value creation directions of "getting more customers, better quality and higher efficiency".
The author thinks that players in auto parts and maintenance service tracks can use the following 13 methods to build long-term value and become unicorns in the automotive aftermarket — —The company’s value and growth rate depend on the diversity of the following 13 methods and the speed of promotion. The more methods used and the faster the promotion, the greater the company’s value and the faster the growth rate..
1. Auto parts
① Business flow
< the first move > set list:
Intensive expansion of the service area of circulation channels through direct marketing/joining/merger/joint venture (joint venture through Marketplace mode) and other ways, so as to intensively expand the order volume, and then reduce the purchase cost and enhance the quality control ability through the way of < centralized collection and unified procurement > or < self-operated OEM brand >;
< 2nd move > membership system:
Establish a membership system to reduce the circulation uncertainty of the whole supply chain by locking the purchase behavior of auto parts of car owners or repair shops in advance, and then reduce the inventory backlog cost and labor cost under no operation state caused by circulation uncertainty;
< 3rd move > "Vin code → Auto parts SKU "database:
Establish a database of mapping relationship between vehicle Vin code and auto parts SKU, and support 4S shops/repair shops, distribution channels and brand manufacturers to interact in various ways, such as text/picture/voice, which greatly reduces communication costs;
② Logistics
< 4 > logistics infrastructure:
Establish central warehouse, city warehouse, pre-warehouse (store) system and logistics billing algorithm to greatly reduce logistics costs in the case of intensive orders (depending on the use progress of various methods in business flow);
③ Production
< 5th move > hardware upgrade:
Under the basic conditions of highly mature auto parts supply chain in China, < introduce advanced hardware equipment of world top brands > or < self-developed hardware equipment >, thus reducing the production cost of the factory and improving the delivery quality of the factory;
< No.6 > Software upgrade:
Open ERP system with downstream channels and upstream raw material suppliers, and do capacity optimization based on data (sales order information/raw material supply information/factory capacity information) and AI algorithm;
④ Finance
< No.7 > vertical supply chain finance:
Due to the inconsistency between upstream and downstream accounting periods in the auto parts industry chain, data-driven supply chain financial services can be provided for brand manufacturers, distribution channels, repair shops /4S stores (refer to steel B2B e-commerce players looking for steel nets);
⑤ Internal operation of enterprises
< trick 8 > SaaS:
For factories, distribution channels, repair shops /4S stores, develop professional SaaS systems suitable for auto parts industry, so as to improve the operating efficiency of each unit of the industrial chain (including invoicing, ERM, IM, manpower, finance, etc.).
2. Maintenance service
① Business flow
< trick 9 > bind the insurance company:
Deep binding with insurance companies through cooperation agreements/cross-shareholding, etc., the two sides share customer resources with each other and jointly reduce the cost of obtaining customers;
< 10th trick > membership system:
Establish 2C membership system, reduce the uncertainty of service demand forecast by locking the maintenance consumption behavior of car owners in advance, and then reduce the inventory backlog cost and labor cost under the condition of no operation caused by the uncertainty of demand forecast;
② service
< 11th move > Senior technicians share the platform:
Because experienced technicians in a region are scarce resources, and the cost of hiring such senior technicians in a single repair shop is too high (the frequency of difficult problems encountered by a single repair shop is relatively small), the shared platform for senior technicians can minimize the labor cost of repair shops and increase the personal income of senior technicians at the same time;
< 12th move > Maintenance experience sharing platform:
China’s Ministry of Communications conducts certification examination for maintenance technicians in repair shops every year, but there is no strict high-standard system for qualification examination as a whole, so most technicians still need to improve their maintenance level through "personal experience" and "indirect reading of master’s work notes".
Therefore, establishing a maintenance experience sharing platform to support technicians to find corresponding solutions through text/picture/voice when encountering problems can greatly improve the maintenance quality and reduce the maintenance cost (reducing the cost of returning goods and training due to misjudgment, etc.);
< 13th move > Remote maintenance and diagnosis platform based on networked sensors;
At present, all the control units (such as engine and gearbox) in the car have been digitized and networked, and automobile brand manufacturers have established a perfect data diagnosis and maintenance guide system based on this. In the past, this system was only open to 4S shops, but now it has been gradually introduced into the independent market.
Therefore, based on this technology, a remote maintenance and diagnosis platform can be established, which can automatically give early warning signals in the process of automobile driving and then guide the owner to adjust his driving habits or carry out lightweight maintenance. After an automobile accident, the platform can automatically send orders to the best repair shop nearby and support experienced technicians and experts to interact with ordinary technicians in the first-line repair shop in real time through AR equipment, thus greatly improving the maintenance quality of the repair shop and reducing the maintenance cost (reducing the labor cost of senior technicians).
It should be noted that — —
① There is no fixed application order for these 13 methods.For example, a company can first be an OEM brand foundry, and then use the advantages of supply chain to intensively open auto parts chain stores; You can also start a chain store of auto parts intensively first, and then make an OEM brand after you have a scale advantage.
② These 13 methods can be completely used by one company, and can also be jointly used by more than one downstream cooperative relationship or joint venture of several enterprises.For example, logistics infrastructure, an auto parts distributor can build its own logistics infrastructure, use the logistics infrastructure provided by a third party, or build its own logistics infrastructure for some businesses and use a third party for some businesses.
③ The value of the company and the speed of its growth depend on the diversity of the company’s use of 13 methods and the speed of promotion.But it doesn’t mean that companies need to use various methods at the same time in the initial stage. It is suggested that start-ups focus on one thing in the early stage to achieve the ultimate. The so-called "it is better to break one finger than to hurt its ten fingers".
How to choose a company needs to carefully consider its own business resources, team resources and market competition environment in specific regions.
Due to the limited space, this paper only presents the valuation status of "auto parts circulation channel", and the valuation system of auto parts manufacturers and maintenance services can be used as a similar reference.
The following table shows the core business data and valuation data of the four major auto parts chain companies in the United States — — Since the main business of Genuine Parts Company includes NAPA, industrial products and office supplies, it is not easy to separate them, so Auto Zone, Advance Auto Parts and O’Reilly are the best three valuation benchmarking companies for auto parts circulation track.
According to the calculation of 2 times P/S, if the market share of an auto parts channel company in China exceeds 1%, the company can become a unicorn with a value of 2.2 billion US dollars (780 billion RMB ×1%×2×1 US dollars /7.07 RMB = 2.2 billion US dollars); If an auto parts channel company is worth US$ 1 billion, its annual revenue only needs to reach RMB 3.5 billion (US$ 1 billion /2×7.07 RMB/US$ 1) and its market share is 4.5‰ (3.5 billion RMB/750 billion RMB).
For auto parts distribution channel start-ups who are interested in cooperating with VC,We can consider taking [becoming a unicorn with a billion dollars in eight years] as the goal, so as to reverse the annual opening plan and store revenue growth plan in the first to eighth years, and accordingly design what kind of commodity procurement system, warehousing and logistics system and store operation system should be built to achieve this [final goal], and then design what kind of team needs to be formed in order to realize this system.— — Although the plan can’t keep up with the changes, and there are many uncertainties in the future business progress, in most cases, "if you plan ahead, you will be abolished."
P.S. The valuation calculation here is only used as a reference for large numbers. In fact, the valuation should be comprehensively considered in combination with the specific fundamental status quo, revenue/gross profit/net profit growth rate and competition links of the enterprise at that time.
The above is the analysis of the present situation and future of China automobile aftermarket according to the top-down method — — After 10 years, there will be many unicorns in the aftermarket. I look forward to your contribution here!
[Author of Titanium Media: This article comes from WeChat WeChat official account "Xianfeng Chuangchuang" (ID:xianfengk2vc) by Zhang Runtao. 】
