Engaged in agriculture, do not design business model is very dangerous! in the agricultural sector, will design the business model, it is critical! winners this line is often the business model innovation leader. Because the various stakeholders in the industry particularly hard fixed up: upstream suppliers are mostly highly dispersed farmers, poor sense of integrity; downstream low consumer loyalty, price sensitivity is high. But there are many successful models, such as guilt mode, profit lock mode, security companies mode. In the agricultural sector, enterprise business model innovation is particularly critical. And one of the winners, often business model innovation leader. With China's agriculture has entered a transformation accelerated phase, in 2008, the agricultural products 'wholesale prices' has shown a rising trend oscillation, many agricultural enterprises began to emerge. But if Porter's 'five forces competitive model' to analyze agricultural enterprises, will find that most companies at a disadvantage.
First and low bargaining power of suppliers. Agricultural enterprises upstream suppliers are mostly highly dispersed farmers, but they conscious integrity, poor performance capabilities, price sensitivity is high, so companies can not establish a stable supplier system. Second, and low bargaining power of buyers. Agribusiness downstream customers for consumers, their brand loyalty is low, sensitivity to price is high. Moreover, the company's brand-building investment, access to distribution channels, especially high cost of super, capital tie serious. Third, the threat of new entrants. From a market entry barriers, the Chinese agricultural resources is highly fragmented agricultural land resource circulation policies and regulations are not sound, resulting in a number of competitors in the same industry. Fourth, the threat of substitute products. Many kinds of agricultural products, consumer hot spots continued conversion price fluctuations of agricultural products. Fifth, competition within the industry is now a competitor. Agricultural enterprises face unfavorable competitive environment, it is necessary to prepare a large number of agricultural products acquisition of funds, but also to invest heavily in breeding, slaughtering, processing, warehousing, logistics and other facilities, to establish a stable raw material base and production and processing base. From the perspective of risk management, agricultural enterprises have to face fluctuations in climate, disease and upstream agricultural raw materials prices, either their own or investors, it is pressure, low return. As referred to herein agricultural enterprises, it is engaged in planting, forestry, animal husbandry, fisheries, agro-processing and agricultural services around the modern, and modern agriculture industrialization of agriculture-related enterprises. Next, we pass a number of cases, to discuss how to design innovative business models in the industry. Model business transactions with farmers and farmers' transactions, typically in the lease of land, anti-employed farmers planting or breeding enterprises to provide seeds, fertilizers, pesticides, breeding stock, feed, and signed the 'purchase of agricultural agreement' to lock acquisition prices. Want in order to establish stable supply relationships with farmers exclusive. But often counterproductive. Due to fluctuations in prices of agricultural products, farmers often sell to buyers bid higher agricultural product prices are high, but when prices are low requires companies to fulfill the agreement to guarantee its benefits. Related legal means difficult to breach farmers effective control, so how business model innovation, locking relationship with the farmers, is particularly critical. The following are several examples to illustrate.
Recombinant wheel modes of a vegetable export companies and farmers signed a 'land lease' agreement, another anti-employed farmers to grow vegetables. But farmers remain the land as their own, is not in accordance with the specification requirements of enterprises, but also secretly sell to outside buyers. To this end, the measures taken by the company are: "digimon cosplay costumes " re-organization carried out rotations. Enterprises farmers removed from their own land, and one-year change, in order to strengthen farmers 'are hired' consciousness. While vegetables maturity, organization staff care, patrol. And in support of the government investigation, dismissal private sale of agricultural products breach of farmers. By several measures to stabilize the supply relationship. Mode even sit in the same village a fruit Established agricultural cooperatives, farmers organizations in order to land shares, in the design conscious arrange farmers' formed the whole village, 'the way to join.
Then select the most influential big village as a manager. Once the situation of farmers selling stolen goods displayed, the sale of the business to cancel the entire village to eligible agricultural products. Thus, farmers will be accused of breach of the same village. Of course, after the penalty period, companies will allow compliance villagers sell their products to other forms of enterprise, but penalties for violators will be lifelong. However, this practice is still not to lock in the interest of relations perspective. 'Profit Lock' mode in the aquaculture industry, companies often prelocked farmer profits to stabilize cooperation with farmers. For example, the company commissioned a number of duck farmers stocking and support. Farmers in 'open account' Getting Yamiao, feed and medicines from the company, and feeding. After the delivery of a duck farmers, the company according to the agreed purchase price, net of related costs, and ensure farmers a fixed profit (such as 1.5 yuan per duck), to achieve the interests of the lock. But only a few calculated by profit, farmers will produce an inert, not pay attention to the size of the duck, diminishing marginal efficiency of enterprises. And there is a farming enterprises to improve pricing: According to the FCR (ie livestock and poultry feed per gain weighing one kilogram consumed) to the settlement. Specifically, the first based on 'FCR' to deliver the same number of duck farmers rank ranking elected 70% of households, and the last one of these farmers as a benchmark, as this batch of ducks unit price. For example, according to the farmers farming costs plus profit of 1.5 yuan each, calculate the total amount, then let's divide it by the total weight of the duck, duck obtain this batch unit price. Data released after each public accounting fair chance. Farmers open and fair settlement of this very satisfied. Moreover, few of excellent duck farmers each profit of more than $ 2, the enthusiasm of farmers is also high. There's farming enterprises in order to avoid farmers to sell their products to a third party, in the provision of avian, when breeding stock, significantly raise prices, leading to higher product costs farmers generally market price, while guaranteeing farmers' profits in the final settlement, so reducing the risk of default of farmers to sell products to third parties. A summary of these measures is the essence: increasing the risk of default after farmers suffered economic and mental punishment, while relatively stable profits attract farmers, as well as incentives to improve the quality with overcapacity to motivate farmers under, through long-term stability of the contractual relationship to lock in collaboration with farmers. Funding bases to enhance the proportion of agricultural production, stabilize the upstream supply companies. However, in the agricultural industry, slaughter, breeding, cultivation base of huge investment and long payback period, the risk is great. Funding bases, and is also a problem. If you rely solely on the profits of enterprises, often difficult to support. Once occupied by the enterprise to acquire funds to build the base of the enterprise is irreparable blow.
For example, a well-known pear juice manufacturers, diverted the flow of funds for the bases. The pre-arranged bank loans because banks are diverted to others, leading companies do not have sufficient funds to purchase raw materials, so companies do not have sufficient product to supply the market within a year, brought to its knees. In fact, the use of agricultural large resources for base "butler cosplay " construction, it is a valid approach. Moreover, as Chinese agricultural intensification, large-scale development, agricultural resources will gradually focus. Thus, agriculture occupies a large resource of quality is the key to winning business, but also set up barriers to entry of the weapon. For example, a farming enterprises, investment in fixed assets of farms by the farmers to invest their own half, and then by the corporate guarantee, the bank supporting the remaining half of the loan. And the company also pay half the interest. VI: security company model of enterprise as a guarantor, the risk is still small. China's feed industry, 'Conglomerate', the design of a 'security company model.' VI established the 'Binzhou and Xingmu guarantee company' in 2007 with a registered capital of 20 million yuan. The amount of funds that can guarantee the security company, whose registered capital is five times that of a billion. And the money can build about 400 standardized coop. And after the house construction is complete, farmers can continue to obtain guarantees from the security company to obtain liquidity from the banking department. According to poultry breeding cycle of a year, six times the turnover, that the formation 600 million yuan liquidity. Base construction in the settlement of the funds after six and then through its feed mill, cold storage, breeder farm, veterinary medicine factory, for the farmers to provide total solutions, including field house infrastructure, nanny technical service, quality and cheap the species of animal and veterinary drugs and so on. Benefit from this, six and a rapid increase in sales revenue. 2006 revenues of approximately $ 9.8 billion in 2010 rose to 50.7 billion yuan! Can be seen from the above cases, direct investment or joint venture construction of the base and farmers, to six and set up a security company from the traditional enterprise, zoom lever to Farmers guarantees, business model innovation, step by step upgrade. How to deal with hedge the risk of price fluctuation of agricultural price volatility of agricultural products, enterprises have to face difficulties. Most companies approach is to price to the downstream transmission.
But this way follow the market will lead to business in a passive position in the competition. Some companies through innovative business models to deal with this risk. 'Establishing storage base' model in response to fluctuations in raw material prices, a number of companies to work on the warehouse building, the establishment of preservation storage, when the farm to acquire low-cost, high prices when sold. However, the storage base construction costs and operating costs are not low. However, the following two companies practices do have worth learning place. A large-scale agricultural products processing enterprises, and its products are fresh corn food, beverage series. It will build a national air defense facilities, transformed into Asia's largest cold storage, can store twenty thousand tons of corn. These cold, not only effective against the volatility of corn prices, and relatively low operating costs. The other, a fruit company in the self-built cold storage peripheral, built a common warehousing and farmers markets, the cold storage business and commercial real estate combined. Through income commercial real estate projects, has its own low-cost storage capacity. Deep processing of products, increase the added value of deep processing of products, not only high value-added, often have a stronger ability to resist risks. Leader of jujube industry, 'miss you', that is, through this way, to deal with price volatility. 'I miss you,' the largest cost of raw materials, accounting for 77-87% of the total cost of sales. Therefore, it is through the following three ways to reduce cost of raw materials to cope with price fluctuations. First, the product processing. 'I miss you' developed a deep-processed products dried jujube and date slices, raw material costs were reduced by the proportion to 65% and 27%. Second, high-end products. Xinjiang is the country's high-end dates areas, although the purchase price is high, but higher gross margin. For example, the company acquired 25 yuan per kilogram of dates, gross margin is typically 25%. The acquisition of jujube 35-40 yuan per kilogram, gross margin over 30%. Third, self-built base, smooth price volatility. In 2011, self-built production base has more than 5,000 acres in 2012 would add another 1,000 acres. 'Hedging' mode and some companies use 'financial instruments' hedge, it is a innovative way. They use the futures market, the implementation of 'hedging' to avoid the risk of price fluctuations. As long as the policy properly, it can play a good role. For example, 'Beijing DBN Technology,' the main business is feed development, production and sales. Its raw materials are mainly corn, soybean meal and oil, rice bran, cottonseed, rapeseed, flour, accounting for about 40%. To this end, companies use the futures market to cosplay costumes for sale buy a corresponding number of futures contracts, spot market prices and avoid the risk of rising procurement costs. In 2010 the company expects corn, soybean meal usage has reached more than 450,000 tons, for which the corresponding futures contract to buy the futures, total no more than 50,000 tons, accounting for raw materials in 2010 is expected to amount to 10% less than the margin 20 million yuan. In the end, although the average price of the year the company purchased corn, fish meal rose by 16% and 37%, but because it made money in the futures market to hedge the spot market costs.
Then feed products company's gross margin fell by only 1.5 percent, thanks in part to its 'hedging' initiative. Mature companies, the futures market is bound to intervene. The traditional 'company + farmers' mode, it will become a 'company + farmers, base + factory, futures + orders' a new agricultural model. Agribusiness: management more standardized, more easily stand on agribusiness management more standardized, the easier it is to widen the gap with the other competitors, and the use of capital markets to achieve greater competitive advantage. In the agriculture sector, enterprises have insufficient financial discipline in listed companies also repeatedly exposed fraud scandal, which is related to the special nature of the industry. Because the company stock, mainly a large number of agricultural products, are not easy to measure and count. And procurement and marketing of agricultural products, mostly for cash transactions. While state tax support, but also result in a lower cost of fraud and other enterprises. There are some companies, due to the financial consciousness, product sales contracts and financial accounts information is inconsistent, can not say to investors clear articulation of the business and financial condition, which makes them difficult and capital market destined. Our percentage of change from the cash settlement 'Eagles farming,' look at how it can improve the management level, and ultimately landing the capital market. The company mainly engaged in pig and chicken farming, its procurement targets and sales targets are mostly natural, such as farmers, growers and brokers, etc., so the larger the amount of the cash settlement. 2007--2008 年 their purchases in cash settlement ratio exceeds 85%. In sales, the proportion of the cash settlement is also more than 96%.
But since then, the company determined to standardize their management. In procurement, increase the 'Corporate Supplier', and gradually select a large scale supplier of long-term cooperation, and to ask them to give some account of, and take bank transfers or money orders settled. The proportion of the cash settlement in 2009 for the purchase of 42% in the first half of 2010 was reduced to 27%. In sales, also requires customers to adopt a 'bank transfer' settled. When the customer home delivery, finance staff and customers went to the bank to raise money, and then into the company account. In 2009, the proportion of the cash settlement of sales was 61% in the first half of 2010 dropped to 5.7%. It also developed a purchasing and sales system of internal controls. The reform and innovation, not only the 'Eagles farming' was recognized investors and the successful listing of the securities regulatory authorities, but also makes it stand out as the leading enterprises in related fields. Agriculture is one i i dark horse dark horse industry's operating accounts series, search for micro-channel public account iheimanongye can find me. If you also like agriculture and agricultural services, such as farming, aquaculture, animal husbandry and fishery, agricultural business, agricultural industry and all human-related industries please pay attention to me, those things we talk with agriculture. There or be square.