Going public is the node that Chinese solution providers must go through when they reach a certain stage of development. It is also an important goal for many vars in their development process. In recent years, a growing number of domestic vars have made it to the capital markets. In addition, there are quite a number of enterprises, are walking in the sprint to the capital market on the way.
However, while listing is a welcome step for domestic vars, how the company develops after listing is actually more important than listing itself. Going public will bring about direct changes and impacts to the strategy, management and business composition of the enterprise, and even bring about some difficulties that have never been encountered before. If the solution provider does not face and deal with these changes and difficulties well, it is likely to make the enterprise into a bigger dilemma.
In this respect, there are some "pioneers" among the domestic vars: they have been registered in the capital market since around 2003, and after about 10 years of development, they have become the leader among the domestic vars. Their development experience is undoubtedly a good reference and learning function for those domestic vars who have just gone public or are preparing to go public.
The inevitable difficulties
Most Chinese vars start from a certain industry, and gradually take the lead in their own industry with their understanding of the business of the industry they focus on, and continue to grow and grow. However, when the development reaches a certain stage, vars will face some inevitable challenges and difficulties.
The level of product and technology needs to be upgraded
A general manager of a domestic IT solution provider once lamented to a reporter, "Compared with international IT giants, we lag far behind in terms of products and technology."
Indeed, this is a very real problem, but if you want to make breakthroughs in products and technologies, domestic vars must continue to invest in this area of scale, which for vars in the process of growth, it is a little difficult. "We also want to spend a lot of money on research and development, but the problem is that our money is tied up in customer projects and we don't have a lot of money for research and development." A medium - sized solution provider engaged in government services said helplessly.
Lack of capital investment, domestic vars cannot make breakthroughs in products and technologies, which means that IT is difficult for domestic vars to compete directly with international IT service providers at the high end of the industrial chain, and they can only hover at the low end of the industrial chain, or "sell heads" for international IT service providers.
The dilemma brought about by the irregular market environment
Due to the lack of product and technical advantages, the products of each solution provider tend to be homogeneous. Therefore, domestic vars are easy to fall into a vicious price war, which will have a fatal impact on the development of the whole group of vars. In addition, due to the uneven quality of users, some users after the completion of the project payment arrears, or set some harsh terms, so that the interests of the solution providers are difficult to be guaranteed, and some solution providers even fall into financial difficulties. In fact, over the past decade, it is not uncommon for industry vars to collapse overnight due to the break of the capital chain.
The fragrance of wine is afraid of deep alleys
Most Chinese vars start from the industry, so they don't pay much attention to brand construction at the beginning of development. Because users in their industry are very familiar with service providers, many vars believe that brand influence will not have a great impact on the performance of vars, and they prefer to invest their funds and resources in other links directly related to the business.
However, with the continuous development of solution providers in the industry, one day they suddenly find that the market growth space within the industry can no longer meet the needs of rapid growth of enterprises. At this time, enterprises must expand to other industries. However, due to the lack of sufficient brand influence, the difficulty of such expansion can be imagined.
Because, in a strange market, users in the choice of IT service providers, most of the time is to choose the brand. Brand has become a symbol of the comprehensive strength and service level of IT service providers, IT service enterprise reputation measurement standard.
Confusion of transformation
Over the past decade, "transformation" has probably been the most familiar word among domestic vars. In particular, those vars who occupy a monopoly position in a certain industry will find that the market they are in has become saturated and the room for growth is limited when they reach a certain scale. At this point, solution providers are required to transform and seek new market space or new business models.
But for vars of a certain scale, the transition is not easy. This involves not only changes in the direction of the business, but also changes in the company's operating model, personnel composition, and even management model. Therefore, in the process of transformation, many vars will encounter a variety of difficulties, making the transformation difficult to complete.
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