Recently, Lei Jun was particularly high-profile, holding high, fighting for the expansion of mergers and acquisitions, like last year's Alibaba. However, careful dissection of millet can also see many of its fatal weaknesses. In the high-profile, Lei Jun can not be dazzled by good news, to keep calm and not forget the heart is more important.
First, core technology and patent issues are the biggest weaknesses. Although the rapid rise of millet, but in the core technology has been in a catch-up phase. In particular, this gap is particularly acute when compared to Huawei and ZTE, which have transitioned from communications devices to mobile phones. The shortcomings of the core technology show the absence of patents. The problem that Xiaomi encountered in India recently is the response to this problem. Millet faces a growth bottleneck in the domestic market and must expand in foreign markets. Once international markets are opened up, patents will not be a barrier.
Second, Xiaomi needs to increase its control over the industry chain. If mobile phone manufacturers want to achieve healthy development, they must control the industrial chain. This is true for either Apple or Samsung. Controlling the core components such as chips and panels is very important for guaranteeing the timely delivery of products. Of course, we see that Xiaomi is also investing huge amounts of money to make up for this short board. For example, in the chip field, Xiaomi and Lianxin Technology have established a joint venture company to make mobile phone chips, but these need a long process.
Third, the construction of the ecosystem of software and content needs attention. Lei Jun from the hardware into the Internet, fancy is certainly not the slight profit of the hardware, it must rely on software and content to make money. However, in this respect, Xiaomi is inherently weak. Although he performed well on MIUI at first, in the software and content, Lei Jun has to do more. Recently, Xiaomi digs Chen Yu and invests in iQiyi, Utu, and other video companies. He hopes to explore a road for software and content.
Fourth, Xiaomi, which is expanding in diversification, is getting further and further away from his respected focus. Lei Jun's secrets of success, "focus" is a very important keyword. It is precisely because of the focus of only one mobile phone in a year that Xiaomi can concentrate resources and create quality products, thereby bringing about the ultimate experience. However, Xiaomi is facing the opposite of focus this year. Mobile phones are no longer a one-year model. From mobile phones to tablet computers, televisions, bracelets, smart homes, and routers are becoming less and less focused. This method of decentralizing resources can easily affect the user experience, and then it will repeat the tradition of manufacturers. old road.
Fifth, Xiaomi’s channels are increasingly isolated. Xiaomi is now the third largest e-commerce company in China, but Xiaomi is too selfish in the channels and increasingly isolated in social channels. Xiaomi has never had a cooperative relationship with JD. The relationship with Alibaba is also lukewarm with the combination of Alibaba and Meizu. Xiaomi's e-commerce business is based on fan culture. If Xiaomi’s public users have a negative word-of-mouth effect, it will definitely affect Xiaomi’s brand and thus influence millet’s flow and attention on e-commerce. At this time, where is the relationship between other channels in general, Xiaomi's e-commerce traffic comes from?
Finally, does Xiaomi's low profit rate support the valuation? According to reports from foreign media, there is a detail. In the case of All-Stars All-Star Fund, Singapore Sovereign Fund GIC, DST, and Yunfeng Fund, some large investors refused to participate in the above financing transactions because they were worried about Xiaomi. Unable to successfully transform from smart phone vendors to high-margin software and service platforms, Xiaomi’s valuation is considered too high. In cooperation with the United States, Xiaomi’s financial data was exposed: Xiaomi Technology’s 2013 revenue was 26.583 billion yuan, operating profit was 486 million yuan, and net profit was 347 million yuan; as of the end of the year, Xiaomi Technology’s total assets were 6.452 billion yuan, and total liabilities 60.57 billion yuan, the owner's equity was 395 million yuan. Based on this data, Xiaomi’s net profit margin is only 1.3%. Whether such a low profit rate can support a high valuation of 45 billion U.S. dollars is doubtful.
All in all, the speed of Xiaomi's rise is remarkable, but in such an era of rapid change, the subversive is easily overturned by another subversive. Will Xiaomi be able to make up for these weaknesses and create a miracle?
Nan Xiaoyi shark (WeChat public number: southsharker): Interpretation of the general trend of development of the industry to reveal the truth behind the news, summed up the experience and lessons of the Internet. Concerned about the sharks of Nan Ming, we can understand the Internet here because we know the general trend to win the future.
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