Bing City Machinery Manufacturing Group's automobile brands are increasing, and some people are worried about it.
They still remember what Feng Yu had said in the past. There were too many brands of the same brand, and that's why the losses were high. That's why the losses were so high during the financial crisis.
Also, Ford is the same. When the economy is bad, they can only sell their automobile brands to save the company.
But with all these negative examples, how come Bing City Machinery Manufacturing Group's brands are increasing?
Songjiang Motors used to be a brand, but Oriental Deer was set up as a separate brand for SUVs. After that, they set up Elfin to produce small and cheap cars.
Now, they acquired Jaguar to focus on the middle and high-end market and sports cars. Isn't this weakening Songjiang Brand, which is supposed to be the strongest?
Someone even said Songjiang Motors should be separated and set up a few sub-brands. The low-end, mid-end, and high-end market must be separated. It's not enough to separate the car models.
Feng Yu heard these arguments.
Li Mingde and Li Dafu felt they should not have too many brands. But some higher management felt it's fine to have a few more brands. Japan and Europe's major automobile manufacturers also have more than one brand.
"General Manager Feng, I think we should set up a few more sub-brands and divide our market. This will help us capture different segments of the market."
"Look at the Chinese market now. All the major automobile manufacturers are going all-out. Not only they have their own brands, but they also have joint ventures. This will affect our market share, and our market share is dropping."
"If we don't do something, our passenger car market share might drop below 40% or even below 30%."
"Once we divide the brands, we can use our Bing City Machinery Manufacturing Group's brand advantage and appeal to our customers. It will not be hard for us to market our sub-brands, and we can target different markets with different brands. Maybe we can increase our market share to more than 50% in China's passenger car market!"
"Manager Xu, didn't you learn from the other automobile manufacturers' mistakes? It's easy to overlook one brand and lose sight of another. Furthermore, we already have four brands, and we cannot increase the number. "Li Dafu retorted.
"Chairman, I don't think so. There are too many brands using the same brand, and many of them are making losses. However, our brands will not suffer losses, our market share will increase, and our profits will also increase. These are two completely different things. "
"Look at Dezhong and the Japanese automobile manufacturers. They are also operating under multiple brands. How fast are they expanding? Maybe in two years, Toyota and Dezhong will be the top two automobile manufacturers in the world. "
"Also, I've studied other multi-brand companies. Although they aren't car companies, as the world's top companies, there are many things that we can learn from them."
"For example, Procter & Gamble, the world's largest consumer products company. Their profit margin is over 10%, and they have more than 100 brands. Among them, there are more than 10 brands with sales of more than 1 billion RMB, and many of them are from the same category."
"If they can, why can't we? The reason why the same cars are losing money is related to the management of multiple brands. But more importantly, they do not have an effective alliance. We do not need to worry at all. Our R&D centers are all together. "
Manager Xu was now the Deputy President of Bing City Machinery Manufacturing Group. He knew Li Mingde will retire next year, and Li Dafu will succeed him. That means the position of the company's President will be empty.
There are a few Deputy Presidents in the company, and Manager Xu is in charge of the automobile business. He must show his capabilities to take over the position of the President.
The Deputy Presidents in charge of motorcycles, electric cars, farming machines, etc. are also eyeing this position. Manager Xu is the youngest among the Deputy Presidents, and he felt he has the highest chance.
Feng Yu looked at everyone arguing. Some are supporting Li Dafu, and some are supporting Manager Xu. It's fine if there are arguments, as long as they can convince each other. If no one speaks up and the leaders are right, the company will be in danger.
"Alright. Everyone, quiet down. I think I understand what Manager Xu is trying to say. Since Manager Xu is using Procter & Gamble as an example, I will also share my views. "
"Cleaning company is the world's most successful consumer products company. They do not have more than 100 brands. They have more than 200 brands, and their brands are close to 300. They cover more than 10 categories."
"CEO Xu thinks that we should learn from such a multi-brand company that can operate very well and expand faster and faster. I agree with this point."
"But Manager Xu had also mentioned that Procter & Gamble is different from our Bing City Machinery Manufacturing Group. They are consumer products, and we are machinery."
"How long is the lifespan of machinery? Can it be used up within a month or a few months? Also, how much does a car cost? Even the cheapest Elfin costs more than 10,000 RMB. "
"How much is a bottle of shampoo? How much is a bottle of hand cream? How much is a bottle of cologne? How much is a tube of toothpaste? There are also washing powder, soap, and other products. Many villagers with low incomes can afford them, right? "
"They are consumer products, and the core of consumer products are consumer products. We need to use them every day, and their consumption is high. You can buy Head & Shoulders today, Pantene tomorrow, and Softness the day after. Maybe you might say that you can't finish a bottle in a day, but what about a month or three months? "
"But cars are different. How many people can drive one car today and another tomorrow? You can stop driving for three days, but can you stop washing your hair, face, and teeth for three days? "
"This kind of fast consumer product is really incomparable to our cars. As for why they have so many brands, you all can see that many of their brands are acquired. "
"For example, Taihua Holdings also has consumer products. A few of their brands were acquired from the world's top consumer products companies like Procter & Gamble and Unilever. When they entered the Hua Xia market, what if their brands are not recognized? "
"They will acquire a few of China's most famous consumer products brands and use these brands to gain a foothold in the market. This way, they can promote their own brands."
"It's like some of China's famous consumer products, but no one overseas has heard of them. They have their own brands."
"This method cannot be replicated for automobile companies. Automobile companies of the same type expanded in this way and failed. A big automobile brand is much more expensive than a Japanese consumer product brand. "
"Since Manager Xu thinks that the European and Japanese automobile manufacturers have many brands under them, you should know that Dezhong's Dezhong brand and Toyota's Toyota brand also have cars ranging from low-end to high-end. It's just that they use different names to differentiate their cars."
"More intuitively, whether a car is expensive or not can be seen from its exterior design. Compact cars are mostly economical cars. Which one of those cars that look so grand are cheap? "
In the end, Feng Yu made the final decision. "We will use these brands for the time being. These brands are enough for the domestic market. In the future, we will not object to acquiring other brands in the overseas market. But they must be high-quality brands. We will not accept ordinary brands!"
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