Haier Group’s transnational development strategy
1. Product export and overseas investment status
It can be said that even in the early stages of enterprise development, Haier Group is very forward-looking. A conscious entrepreneur, Zhang Ruimin is making preparations for the company to develop into the international market. Only 4 years after he arrived at the Qingdao Refrigerator Factory, when the products became somewhat famous in China, he expanded his vision for business development overseas. Earning foreign exchange through export is necessary, but it is only one of the purposes. The other purpose is to create a well-known brand internationally.
(l) Export business status
Since the Qingdao Refrigerator General Factory exported its products for the first time in 1986 and achieved an impressive export volume of US$3 million, Haier Group has The export volume is increasing year by year. Although the Southeast Asian financial crisis broke out in 1997 and the exports of Chinese companies were hindered, the real high value-added products like Haier products were not greatly affected, and since the focus of Haier Group's exports is in Europe and the United States, its exports Continue to maintain growth momentum. In 1998, Haier's foreign exchange earnings from exports reached US$76.75 million, an increase of 36% over 1997.
The main types of exports are refrigerators, washing machines, freezers, etc.
In terms of the distribution of export regions, basically, European and American countries account for 6O%, Japan accounts for 20%, Southeast Asia accounts for 16%, and other regions account for 4%, totaling 87 countries (regions). Refrigerators and air conditioners are mainly exported to European and American countries. Among them, Haier refrigerators account for 20% of the market share of refrigerators below 180 liters in the United States.
As of the end of 1998, Haier Group had 49 overseas dealers and more than 11,004 distribution outlets.
(2) Overseas investment situation
Haier Group has been investing and building factories overseas since 1995. After discussions and negotiation, Haier's first overseas joint venture manufacturing enterprise mainly engaged in the production of refrigerators - Haier Paul (Indonesia) Co., Ltd. (PT. Haier Sapporo Indonesia). It marks an important step in the internationalization of Haier Group. Later, in June 1997, Haier LKG Electric Co., Ltd. in the Philippines was established; in August 1997, Haier Industrial (Asia) Co., Ltd. in Malaysia was established; in November 1997, Haier Air Conditioning Manufacturing Factory in Yugoslavia was established; in February 1999, Haier Middle East Co., Ltd. The company is established.
The above are just a "little trial" of Haier Group's overseas investment business, and the real focus of its corporate internationalization is in the United States, investing and building factories in the United States. This plan will enter the strategic implementation and development stage in 1999, that is, building a design center in Boston, a marketing center in New York, and a manufacturing center in South Carolina.
2. Causes of transnational development strategy
There are many reasons that promote Haier Group to actively develop transnational operations overseas, including both international factors and domestic factors.
In the domestic market, due to the rapid development of the home appliance industry, competition in the domestic market has become increasingly fierce. Price wars are occurring one after another in various home appliance fields and are becoming more and more intense. Although Haier Group, as a manufacturer of well-known domestic appliance brands, has a clear advantage in the domestic market, it believes that it is precisely because of its high market share that it is the best time and necessary to actively expand overseas and develop transnational operations. The conditions and internal motivation are already in place.
In the international market, with the development trend of world economic globalization, domestic enterprises in each country are subject to competition and impact from external economic forces represented by multinational companies. Developed countries and their multinational companies dominate the development of the international market. Whether developing Chinese companies can "get a piece of the pie" in the fierce competition in the international market is an important way for them to strive to expand their living space.
Haier Group is not willing to be just a famous brand manufacturer in China. It also hopes to actively enter the international market, make Haier products famous abroad
and grab a piece of the international market from famous foreign brands of similar products. share. Moreover, Zhang Ruimin also believes that to enter the international market, we cannot rely solely on the development of exports. We must also develop overseas direct investment and establish a three-in-one network of product design, production and marketing abroad, especially in developed countries, to avoid international competition. Impact and risks caused by market fluctuations. In 1991, Haier registered a trademark abroad (the United Arab Emirates) for the first time. Then, in April 1992, Haier obtained the IRO9001 quality system certification and became the first company in the Chinese home appliance industry to pass this certification. These all helped Zhang Ruimin realize his success in the industry. The idea of ??creating well-known trademarks in the international market has laid an important foundation.
As a decision-maker, Zhang Ruimin’s strategic change in corporate development was a carefully considered one, and facts have proven that this change is correct. Under the influence of the Southeast Asian financial crisis in 1998, China's foreign trade exports were severely impacted. However, Haier Group's foreign exchange earnings from exports increased by 36% compared with 1997. At the same time, while domestic companies are seeking new overseas development options due to export restrictions, Haier Group's overseas investments have already developed in depth. Its trinity (i.e. design, production and marketing) international development strategy in the United States fully reflects the forward-looking consciousness of Zhang Ruimin and his subordinates, and points out new coordinates for the future course of the Haier fleet.
3. Guidelines and implementation methods in the process of international development
(1) The principle of “first difficult, then easy”
Transnational enterprises of developing countries The business development model usually involves exporting or investing in developing countries of the same type first, and then gradually shifting development goals to developed countries. Haier Group goes against this stereotype. Its strategy is to target overseas development in developed countries that are leaders in world economic development. Once it has established a foothold in developed countries, it can easily enter and occupy developing countries. market.
For example, Haier refrigerators first successfully entered the German market, and among EU countries, the German market is the most difficult to enter. Now Haier is fully implementing its internationalization strategy and placing most of its overseas investment in the United States. The United States is the most complex market in the world and extremely difficult to develop. However, Haier people believe that the opportunities here are also huge, and based on subjective and objective factors, the probability of success is also very high. Compared with the failure of investment in other developing countries (although it has not happened yet), the success here is undoubtedly crucial to the overall situation. Moreover, the experience in the United States is of great significance in outlining the core.
Therefore, entering and developing the home appliance market in developed countries is a crucial step for the company's overseas development strategy. It will help Haier Group always grasp the development trend of world home appliance production and enhance the company's position in the international market. Product competitiveness is of great significance to the realization of the development strategy of "Haier's internationalization and internationalized Haier". At the same time, this new development model also explores a successful path for Chinese enterprises to invest overseas.
(2) "High Starting Point" Principle
In Zhang Ruimin's view, Haier Group is only in the initial stage of internationalization. Compared with the world's top 500 companies, Haier Group is far from an international company. However, starting late does not necessarily mean it has a low starting point. Haier Group must comply with the highest international standards in all aspects. This is his "high starting point" principle. For example, he requires all business units (referring to various departments of production) to export products, because he believes that the international market is the touchstone for testing product quality and checking whether there are problems in all aspects of the department's work. Through information feedback from the international market, companies are forced to improve management.