/ Daily News/August 05, 2022 Guangzhou -- The 5th China Industrial Products Digitization Summit Forum was held in Guangzhou on July 30. This conference is hosted by Tobey network, supported by Guangdong E-commerce Association, supported by industry leaders such as Gaimenda Industrial Products Group -- Gu Anjie, Yiheda, Xinfangsheng, Zhenkunxing, Qixin Group, Jihu (GitLab), etc. About 300 people attended the conference, including government leaders, experts and scholars, heads of associations from all over the country, entrepreneurs from upstream and downstream industrial chains, industrial digital platforms and so on.
Zhou Yanhua, founder and CEO of Gaimengda Industrial Products Group and its subsidiary Gu Anjie, delivered a keynote speech at the conference. The transcript of the speech is as follows: Zhou Yanhua, founder and CEO of Gaimengda Industrial Products Group and its subsidiary Gu Anjie Respected conference organizer Ning Bo, distinguished guests, ladies and gentlemen, good morning. First of all, I am Zhou Yanhua, the president and CEO of Guangzhou Gaimengda Industrial Products Group and the CEO of Shanghai Gu Anjie Trading Co., LTD. It is my great honor to be invited to this summit to discuss with you the digital road of Chinese enterprises.Speaking of digital transformation, the digitalization of enterprises is the general trend, and digitalization has risen to the national strategy. In particular, the epidemic has put forward higher requirements on the field operation capability of enterprises, and also further promoted the digitalization process of Chinese enterprises. As mentioned above, the change of internal circulation and supply pattern is undoubtedly the demand for industrial upgrading of all Chinese enterprises. Digitalization is a very important management tool and starting point to help us make fine operation in industrial upgrading. Digital transformation of MRO is the only way for enterprises to reduce cost and increase efficiency. The teacher of Yunzhu.com also said that I would like to talk about MRO to create digital procurement solutions and provide enterprises with a full range of industrial products needed in the MRO process. MRO is the first letter of Maintenance, Repair, Operation, three English words, that is, in the process of production and operation of maintenance, repair and operation of non-productive materials, such as instruments, meters, sealing, transmission, placement and other non-productive materials.
Report the company's history, our company originated from North America Grainger, was founded in 1927, New York Stock Exchange listed company, is the founding father of the MRO service model and the leader of the company. In 2006, Grainger China was established in Shanghai and introduced the MRO business model into China. In 2020, with the management led by me, we made a wholly-owned acquisition of Grainger China and completed the transformation from a wholly-owned company to a wholly-owned company with the funding of Innovation Factory. The great asset that was retained after the MBO was our very high quality customer base that had been with us for more than a decade, and our supplier base that had been with us strategically for more than a decade, so we were very lucky to have a strong customer base and supplier base on which to start our business. In the past two years since the management buy-out, we have completed the financing of series A, B, B1 and B2, and even delivered two rounds in a row under the epidemic situation. Therefore, we delivered two rounds in a row under the epidemic situation, which is relatively rare in the market. I am proud of the achievements we have made or the recognition of us by the capital market. There's still a long way to go.
After the management buy-out, because we obtained a lot of financing, we increased investment in several aspects, especially the landing of advanced technologies. Before, Professor Wang talked about the Internet of Things and intelligent AI, but the journey of a thousand years begins with the first step. Our implementation of advanced technology is the construction of big data in the MRO industry and the implementation of digitalization. I will talk about it in detail next.
MRO serves the procurement of enterprises and end-users of enterprises, covering all walks of life, involving more than 30 million categories. In the traditional MRO industry, due to the low degree of datalization and complex tools, a procurement has to face many end users in many departments internally and many suppliers externally. However, as the intermediary service side, the procurement, demand data and supply data do not match, so it takes a lot of time to clarify and communicate, so the whole link is very redundant. Cause enterprises to consume a lot of costs and energy.
The characteristics of MRO are also causing pain points in the process of MRO management, if the traditional method of management, pain points are very strong. What are the characteristics of MROs? The product line is very complex. As I said, there are tens of millions of products, which are highly professional and may involve important spare parts. Diversity, tens of millions of species; Timeliness, because it is unplanned, only timeliness; The way of presentation is to order many and miscellaneous, multi-batch, small batch, no plan, no repeat characteristics. As a result, more than 30% of the management cost is wasted due to the complex and unplanned process.
After decades of customer research and order status research, we show that 90% of materials are only purchased once or twice a year, and the cost of each order, no matter how big the amount is, it costs 500 yuan of process cost, while most orders from the database are less than 1000 yuan, so it costs a lot of management costs. At the same time, due to the non-repetition, data is not perfect, resulting in the inventory is fuzzy, incomplete, due to the non-repetition, resulting in a large number of stagnant inventory, enterprises have to invest a lot of operating capital in the stagnant inventory. So expect solutions only through digital transformation. Digital transformation is a golden key, opening the whole MRO procurement management process, from the initiation of material requirements, material selection, specification to audit, order, planned storage, use, settlement of each node of the whole process is efficient, convenient, traceable and controllable, so digitalization is the golden key to open the efficient and controllable management of MRO. We accumulate data to prepare a large amount of data for the company's future CI. When it comes to Gu Jie MYMRO, we build MRO infrastructure, so thousands of miles from the first step, only to build good infrastructure, no matter the landing of various digital, advanced technology in the future to stand steady.As you know, we entered China in 2006, based on the big data in Taiwan enabling upstream and downstream digitalization, we use self-developed a whole set of big data in Taiwan system, collate tens of millions of market products, service millions of customers in the market, To address both ends of the supply and demand for intelligence, transparency and enterprise cost reduction and efficiency, industrial upgrading needs.
Before the completion of the management buyout, our company spent a lot of energy to learn from Grainger in North America and Monotaro in Japan, both of which are the leading MRO management system in the market and in the world. After learning the advanced management system, combined with the characteristics of Chinese local customers and the market, We have independently built the most powerful standardized product system suitable for the Chinese market and built the most complete product knowledge base in the Chinese market, enabling us to achieve triple system standardization in product structure, product information and product quality. At the same time, it is very important to conform to the product search logic of B-side customers, which is different from C-side search logic. Because it is built on the basis of our middle-desk system, only with a set of data basis can we digitize products, achieve a large number of self-operated products to meet customers' one-stop shopping needs, reduce the number of suppliers, and achieve the purpose of cost reduction and efficiency increase. As I said before, we always adhere to the strategic cooperation and win-win strategy with suppliers and brands, achieve the standard of product quality, and continue to provide customers with long-term stable technical services.
After the completion of the MBO, we increased investment from another aspect, which is also digital. We created an all-round and multi-level national warehouse network layout on the intelligent supply system. After a lot of data precipitation, we created our own set of data calculation model, especially for inventory management. Make precise and predictable inventory preparation, and make a large number of inventory self-stocking through prediction model to improve customer experience. At the same time, our own calculation model and practice of automated warehousing enable customers to do pre-warehouse and unmanned warehouse management, whether it is agent operation, digital management of warehouse locations, customer inventory management, etc., we have done the technology output of digital and automated warehouses, and at the same time, in different customer site use scenarios, according to different scenarios of customers, configure different materials cabinet. However, this material claim cabinet is completely connected with the customer's system, so that information, material, consumption and settlement can be connected in real time. In general
In terms of digital enabling, we create a digital foundation covering the whole process, enabling customers to digitize the whole chain. From the client side, the customer's feeling is e-commerce and SaaS procurement, of course, there are various technical means, I will not talk about technology today.
Second, for customers to carry out comprehensive optimization, this is the system and process aspects, to help customers reconfiguration, manual to automatic. Through the overall optimization of the process, we can help customers save 25%-80% of the process cost.
Third, as for the warehousing and performance of the supply chain, I have mentioned the scheduling, distribution and overall planning on the basis of big data, and at the same time, I will help the customers to build the pre-warehouse of the customers, manage the problems of MRO inventory management, and help the customers to make plans and calculate with our data model.
