1. Is tobacco also a national monopoly in foreign countries (such as the United States, the European Union, Japan, etc.)?
Given that tobacco and its products are special commodities, governments in various countries have different management of the tobacco industry. It is more stringent than other industries. Many countries have implemented a monopoly system that combines prohibition with tax on tobacco companies. In order to adapt to the different policies and measures implemented by the government on tobacco, tobacco companies in various countries have their own characteristics in terms of management systems, including organizational structures, operating mechanisms, and management models. This article will conduct a comparative analysis on the management of several major multinational tobacco companies in the world, hoping to provide reference for the reform of my country's existing tobacco management system.
1. Management System of Japan JT Company
The predecessor of Japan JT Company was the Japan Monopoly Corporation established on June 1, 1949. According to the provisions of the Tobacco Leaf Monopoly Law promulgated by the Japanese government in 1898 and the Tobacco Monopoly Law implemented in 1904, the Japan Monopoly Corporation conducts monopoly management of tobacco production and business activities across the country. By the mid-1980s, under pressure from Europe and the United States to open the market and domestic administrative reforms, the Japanese government decided to abolish the monopoly communes in 1985 and gradually liberalized cigarette imports. On April 1, Japan Tobacco Industry Co., Ltd. (JT) was established. Registered capital is 100 billion yen. After more than ten years of reform and development, JT has become the fourth largest cigarette production company in the world with more than 22,100 employees and currently produces approximately 120 types of cigarettes.
1. Organizational form
The basic framework of Japan's corporate management system is determined by the "Japan Tobacco Industry Co., Ltd. Law" and the "Tobacco Business Law" promulgated on August 10, 1984. According to the provisions of these laws, the Japanese government should retain one-half of the total number of shares issued by JT Company (currently it is actually two-thirds) and implement state control. When the company wants to issue new stocks, it should obtain the approval of the Minister of Finance approval; the election or removal of directors (directors) and supervisors (auditors) of the company can only take effect after obtaining the approval of the Minister of Finance; resolutions on changes in the company's articles of association, profit distribution, mergers and dissolutions, business decisions for each business year The plan can only take effect after obtaining the approval of the Minister of Finance; JT Company must submit financial statements to the Minister of Finance in a timely manner: JT Company shall purchase all tobacco leaves produced under domestic contracts, business operators selling imported cigarettes, and business operators retailing cigarettes. , should obtain the permission of the Minister of Finance, and those who wholesale cigarettes should temporarily obtain the permission of the Minister of Finance; persons other than JT Company are not allowed to produce cigarettes.
The company is a joint-stock multinational enterprise, and its largest shareholder is the Ministry of Finance of Japan. It issued shares for the first time in 1994, with a total of 2 million shares issued, of which 66 or 1.34 million shares were held by the Ministry of Finance. 660,000 shares were issued on the market, with a face value of 10,000 yen per share.
2. Organizational structure
JT Company implements an internal organizational structure in which the shareholders' meeting, the board of directors, and the board of supervisors are separated and the rights and responsibilities are clear. The highest authority is the shareholders' meeting, which is held in May every year to decide on major company-wide matters. It consists of a board of directors, which is composed of 24 directors. The board of directors meets once a month to decide on investment plans, etc. The top executive officer of JT Company is the president, and there are three vice-presidents’ secretarial offices under the president to assist the president in carrying out daily specific work. The Board of Supervisors consists of 2 full-time supervisors and 2 general supervisors. The supervisors are elected by the general meeting of shareholders from the society and within JT. The board of supervisors is responsible for reviewing the company's financial statements and supervising the directors' business. Execution. The daily work is handled by the Supervisory Office.
3. Operating mechanism
JT Company implements a divisional system. In 1994, it carried out a relatively comprehensive organizational reform and established a task-responsibility organizational structure. Now JT Company consists of two parts: comprehensive department and business department. The former includes two parts: the planning department. The former includes 11 departments including Planning Department, Advertising Department, Public Relations Department, Human Resources and Labor Department, Finance Department, and General Affairs Department, while the latter consists of 7 departments including medicine, food, printing, machinery, and real estate development, among which the tobacco business is specially established. Headquarters.
The Tobacco Business Division is the largest department, with eight departments including the Business Planning Office, Merchandising Department, Research and Development Management Department, Raw Materials Management Department, Manufacturing Management Department, and Sales Management Department. The Tobacco Department also has jurisdiction over 31 branches, 10 local raw material departments, 25 cigarette factories, 6 threshing and re-curing plants, the Tobacco Central Research Institute and 2 overseas offices. The Planning Office is responsible for the development direction of "products", "research and development", and "operation", and formulates overall strategic plans such as the tobacco business headquarters' "maximum profit" mid- and long-term plans, changing the lack of unified and coordinated operations between departments in the past. The establishment of the Merchandise Department further promotes collaboration between the marketing department and product development department. The establishment of the Tobacco Business Division reorganized the original three-department system of sales, production, and raw materials into the three basic functions of "commodity", "research and development", and "operation", and fundamentally changed the way in which domestic tobacco work is managed. At the same time, JT Company also re-clarified the scope of responsibilities of each comprehensive department in accordance with the spirit of "creative challenge" and streamlined and efficient, and completed the transformation from the previous business departments and control-type indirect departments to the formulation of company-wide development strategies and stations. Transformation centered on support functions for each business department from a professional standpoint, and finally established a veritable commercial enterprise-type head office structure.
4. Management model
(1) Tobacco leaf production, purchase and sales management
JT Company adopts a centralized and unified management method for tobacco leaf production, purchase and sales. According to the provisions of the "Tobacco Business Law", Japanese tobacco leaves adopt the method of "determining production according to sales, planned planting, contract purchase, and full purchase". JT Company and the National Tobacco Council will promptly study planting area and value plans based on cigarette production and needs, and then relevant organizations will sign planting contracts with tobacco farmers respectively, and determine the grade of tobacco leaves in the Ministry of Finance order.
JT Company will formally study the purchase price of the tobacco leaf planting plan based on the conclusions of the review meeting, and will decompose it to the branch and raw material department, and then the raw material department will decompose it to the tobacco farmers through the local tobacco farmers association. The raw material department signs contracts directly with tobacco farmers. The contractual obligation of the raw material department is to provide improved seeds and technical guidance based on the number of their planting areas, and to purchase all their tobacco leaves.
(2) Cigarette production and sales management
JT Company currently has 25 cigarette factories distributed across the country, of which the largest cigarette factory is the North Kanto Factory. The annual output of cigarettes is about 32 billion cigarettes (640,000 large boxes). The average annual production of cigarettes per factory nationwide is 220,000 large boxes.
JT Company’s cigarette factory is only specifically responsible for cigarette production. It is a typical production workshop and processing point. It implements various plans and indicators issued by the department and does not engage in operations. The factory is not a legal person and does not conduct independent accounting, but is unified by the headquarters. All financial revenues and expenditures of the factory are budgeted by the factory and implemented with the approval of the headquarters. If there are overspends during the implementation process, additional expenditures must be approved by the headquarters. The factory's production plan, fixed asset investment, sales strategy, etc. are all decided and issued by the headquarters. Products are sold by the headquarters. Raw materials, spare parts, etc. are allocated, allocated and transported to the factory on time by the headquarters, and there is no settlement relationship with the supplier. . This is a typical budget management and accounting method.
The factory’s production grades, formulas, technological transformation, technology introduction, new product development, trial production of new products, product quality standards, and the factory’s external cooperation are all formulated or decided by the headquarters. The factory is just a The mission of the production workshop is to ensure quality, quantity, and complete the tasks assigned by the company on time.
(3) Tobacco material management
JT Company headquarters is responsible for door-to-door delivery of all materials needed for cigarette production. The factory has very few material reserves. Among them, tobacco leaves are the most stored, but the reserves can only meet the needs of one month. The reserves of other materials are even smaller, and they can only meet the needs of at least 3 days. This is a typical zero inventory management idea. manifestation.
2. The management system of Philip Morris
Philippine Morris is the largest tobacco company in the world. The company has 150,000 employees around the world. Philip Morris has 436 companies under its umbrella. Distributed in 74 countries and regions, its business has expanded to 182 countries and regions. Philip Morris' main products are packaged consumer goods, including tobacco, food and beer.
1. Organizational form
Philip Morris is a joint stock limited liability company established under the laws of Virginia, USA. Philip Morris is a listed company with 2.4 billion shares and a market value of US$100 billion. Philip Morris' shareholders include investment companies, public stockholders and other companies.
2. Organizational structure
Philippine Morris has a shareholder meeting, a board of directors and a managerial level.
The shareholders' meeting is responsible for issuing new shares, making major transactions, amending the company's articles of association, and electing company directors.
The board of directors is responsible for formulating company policies, making major decisions, determining the company's profit distribution plan, and deciding on the appointment and removal of company executives. The board of directors consists of 1 chairman, 1 vice-chairman and 13 part-time directors outside the company. They are university professors, investment bankers, stock exchange chairman, company president, news company chairman, and airline president. The board of directors consists of an administrative committee, a finance committee, an audit committee, an employee benefits committee, a corporate affairs and social responsibility committee, a nomination and corporate governance regulations committee, and a company employee and development planning committee. The Board of Directors meets monthly.
The company's executive management is divided into two lines under the leadership of the president, namely general management and functional departments. Functional departments include finance department, legal department, planning department, corporate affairs department, human resources department, etc.
3. Operating mechanism Philip Morris adopts divisional and matrix systems in its organizational structure, that is, according to products and regions, it has Philip Morris USA Group, International Group, Kraft Foods Company, America Le Brewing Company, Philip Morris Management Company.
4. Management model
Philip Morris' management methods include strategic management, business management and financial management. Strategic management is mainly about formulating long-term plans, including current year plans and multi-year plans. Business management is mainly about formulating budgets, preparing and revising budgets every year, and financial management is mainly about the company's investments and capital expenditures, including the purchase of stocks, long-term bonds, land rent, machinery and equipment, etc.
Philippine Morris' internal control and supervision include long-term planning, budgeting, and investment approval. Control is primarily achieved through the channels from shareholders to the board of directors to executives. The company follows the principle of fair dealing, including in commercial, financial, and capital activities, and between brother companies, parent companies, and subsidiaries. Information exchange channels within the company include reports from line management and reports from functional departments. The company's financial control is mainly achieved through three aspects: the financial department, internal audit department, and independent auditors. The financial department must prepare financial statements every month, quarterly, and yearly, and report them step by step; the internal audit department reports to the Philip Morris Group Global Financial Manager and the Audit Committee of the Philip Morris Group Board of Directors. The independent auditor of Philip Morris is served by Yongtong Accounting Company and is responsible to Philip Morris' shareholders, directors and managers. Philip Morris' management of employees is mainly to establish an internal incentive mechanism. The salary depends on the working hours, the restrictions of the union and the company's operating conditions; the salary of permanent employees depends on a person's performance and the operating conditions of the business unit. For company managers, the company has some incentive compensation every year, including stock options for middle-level managers and above; there are some incentive policies and bonuses for general employees.
2. Since the Tobacco Monopoly Bureau delivers goods, what is the profit model of cigarette dealers?
Tobacco has a large profit margin. Especially if you sell cigarettes from other provinces
There are even greater profits for fake cigarettes! It’s not surprising to earn hundreds of thousands to one million a year
3. Is there cross-selling tobacco, so the price is lowered?
Generally not, the price market is relatively stable, and everyone is fighting for channels. , purchase channels!
The prices are very transparent, and there is no room for profit concessions or price reductions.