In recent times, Xiaomi Lei Jun has continued to emphasize that the mobile phone business must adhere to the price-performance ratio. However, looking at the rising prices of Xiaomi mobile phones, Xiaomi's current higher profit margins, is it really suitable to talk about price-performance ratio?
Xiaomi's 2019 results show that revenue was 205.8 billion, net profit was 11.5 billion yuan, and net profit reached 5.6%. This level of net profit is actually quite good among hardware companies.
The profit of Xiaomi mobile phones in the global mobile phone company market is not low. According to the data released by counterpoint, Xiaomi accounts for 3% of the profit share of the global mobile phone market, while Huawei, OPPO and vivo in the top four domestic mobile phones account for 8 %, 5%, 4%, Xiaomi is not much different from these mobile phone companies.
In fact, Xiaomi mobile phones have been increasing the price of mobile phones in recent years. When Xiaomi just entered the mobile phone industry in the early years, the price of mobile phones launched was set at 1999 yuan. In the past two or three years, the price has been increasing. This year's Xiaomi 10 has even increased to Starting at 3999 yuan, the benchmark price in earlier years has doubled. Under such circumstances, it is difficult to believe that the profit level of Xiaomi's mobile phone business is still very low!
In fact, the industry in which Xiaomi mobile phones are located is much better than other industries. There are many industries with fierce competition in China, and there are many industries with much lower profit levels than Xiaomi mobile phones.
Take the TV industry as an example. In the 1990s, domestic TV companies had defeated foreign companies in the domestic market. However, the TV industry is still deeply involved in a price war. The net profit rate of the entire industry in 2017 was as low as 1.5%. The industry is losing money.
In the past two years, due to the competition of Xiaomi TVs in the TV industry, the average price of TVs has continued to decline. The cheapest price of 32-inch TVs even fell below 500 yuan. It can be said that the competition in the TV industry is more fierce than the mobile phone industry. .
In the early days, Xiaomi really insisted on a cost-effective strategy in order to break through the mobile phone market. The hardware configuration of the launched mobile phone was equivalent to that of Samsung and other international brands' flagship mobile phones, but the price was only half of them. At that time, it was indeed kind, but now it There is no price-performance ratio for its products, and the emphasis on price-performance ratio is just its slogan.
Xiaomi is a company and it is understandable that it has adopted different development strategies at different stages of development. Now it has become a Fortune Global 500 company in pursuit of profit. There is nothing wrong with it, but now its profit level is not low, but it is still fooling with cost-effective slogans. Chinese people are not suitable.
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