How to break into the cross border car accessories market?
18-05-01
In recent years, there are many new internet start-up companies in the aftermarket automotive parts industry. The market experienced a frenzy of new companies but is evening out because the smaller companies have been bought out. In the past few years, many internet companies have experienced exponential growth, but the automotive industry has lagged behind. Why hasn’t the automotive industry kept up?
Guo Shaobo CEO and founder of the Zhengmai auto parts website has his own opinion on this subject: "Most companies in this industry try to follow the B2C concepts using JD.com or Taobao.com. However, for the automotive accessory industry this business plan does not work.”
Guo Shaobo is an exception in the auto parts field. After graduating from University, he worked for the government, investing in industries such as: automobile, cloud computing and the internet. After leaving the system, he started his own company in the field of auto parts manufacturing. From nothing, he led the team in the field of automotive metal interior (i.e. metal horn covers and metal speak covers ). A few years later, he was competing with a large US company that had more than 70 years of experience. Now, his company is the most widely used manufacturer in the industrial chain and are currently providing Tier 2 products to Ford, BMW, and Changan, Zhongtai and other independent brands. In 2015, he began to prepare an aftermarket auto parts project. After more than 1 year of research and preparation, in 2016, a group of friend established Chongqing cyberstein Network Technology Co., Ltd., and officially started a new business project.
In Guo Shaobo's opinion, the current Chinese online auto market’s industrial chain is decreasing and there isn’t a complete or efficient supply channel. Because the market has been competitive for a long time, the cost of building store and building stock is very high, which leads to the high cost of market expansion. Franchises are difficult to expand. The competition from traditional rivals and the internet is fierce.
Therefore, the online stores who are using this model, are not trying to make billions, but just trying to survive. Among them, several companies that started early and lived to the present stage can only rely on the low-end vehicle maintenance category. These types of transactions are frequent, low cost, suitable for low-cost fast expansion of the Internet game, so they become the main direction. However, once the next round of financing is lost, such projects are almost unsustainable.
The auto parts are the absolute standard, the automobile industry has developed over a hundred years, the specialized division of labor of the socialization has been very full. The original accessories of a certain brand are produced by the OEM manufacturer, and then through the mature supply chain to the end users of a certain brand. It is impossible to copy the industrial chain by burning money. It is even more impossible to replace a link in the short term and supply itself entirely.
The automobile industry has been developing over the last hundred years. The original factory parts of name brands are produced by OEM manufacturers and the product is then delivered to the end user through a mature supply chain system. Even by spending a lot of money, It is impossible to copy this industrial chain. It is even more impossible to replace a this process in the short term and do it by yourself.
Compared with the mature consumer market such as the United States, the Chinese after market is still in an early stage. There is a lack of unified brands in the aftermarket, lack of centralized and efficient supply of vehicle parts, and standardized and high-quality service.
Guo Shaobo told ebrun.com, "With the continuous escalation of automobile consumption and continuous innovation and joint efforts of after market practitioners, an industry structure similar to that of the US aftermarket will eventually emerge in the auto parts distribution sector. From auto parts manufacturers to parts procurement groups and large warehouse distributors, from local distributors to auto repair chains or stores, and finally to users. However, if we want to a place in the future market, we must not get it by spending more than necessary. ”
Guo Shaobo CEO and founder of the Zhengmai auto parts website has his own opinion on this subject: "Most companies in this industry try to follow the B2C concepts using JD.com or Taobao.com. However, for the automotive accessory industry this business plan does not work.”
Guo Shaobo is an exception in the auto parts field. After graduating from University, he worked for the government, investing in industries such as: automobile, cloud computing and the internet. After leaving the system, he started his own company in the field of auto parts manufacturing. From nothing, he led the team in the field of automotive metal interior (i.e. metal horn covers and metal speak covers ). A few years later, he was competing with a large US company that had more than 70 years of experience. Now, his company is the most widely used manufacturer in the industrial chain and are currently providing Tier 2 products to Ford, BMW, and Changan, Zhongtai and other independent brands. In 2015, he began to prepare an aftermarket auto parts project. After more than 1 year of research and preparation, in 2016, a group of friend established Chongqing cyberstein Network Technology Co., Ltd., and officially started a new business project.
In Guo Shaobo's opinion, the current Chinese online auto market’s industrial chain is decreasing and there isn’t a complete or efficient supply channel. Because the market has been competitive for a long time, the cost of building store and building stock is very high, which leads to the high cost of market expansion. Franchises are difficult to expand. The competition from traditional rivals and the internet is fierce.
Therefore, the online stores who are using this model, are not trying to make billions, but just trying to survive. Among them, several companies that started early and lived to the present stage can only rely on the low-end vehicle maintenance category. These types of transactions are frequent, low cost, suitable for low-cost fast expansion of the Internet game, so they become the main direction. However, once the next round of financing is lost, such projects are almost unsustainable.
The auto parts are the absolute standard, the automobile industry has developed over a hundred years, the specialized division of labor of the socialization has been very full. The original accessories of a certain brand are produced by the OEM manufacturer, and then through the mature supply chain to the end users of a certain brand. It is impossible to copy the industrial chain by burning money. It is even more impossible to replace a link in the short term and supply itself entirely.
The automobile industry has been developing over the last hundred years. The original factory parts of name brands are produced by OEM manufacturers and the product is then delivered to the end user through a mature supply chain system. Even by spending a lot of money, It is impossible to copy this industrial chain. It is even more impossible to replace a this process in the short term and do it by yourself.
Compared with the mature consumer market such as the United States, the Chinese after market is still in an early stage. There is a lack of unified brands in the aftermarket, lack of centralized and efficient supply of vehicle parts, and standardized and high-quality service.
Guo Shaobo told ebrun.com, "With the continuous escalation of automobile consumption and continuous innovation and joint efforts of after market practitioners, an industry structure similar to that of the US aftermarket will eventually emerge in the auto parts distribution sector. From auto parts manufacturers to parts procurement groups and large warehouse distributors, from local distributors to auto repair chains or stores, and finally to users. However, if we want to a place in the future market, we must not get it by spending more than necessary. ”
From http://www.ebrun.com/20170817/243033.shtml