In September 2022, Sinolink Securities and Shenzhen Kaidis Intelligent Technology Co., Ltd. (hereinafter referred to as: Kaidis) signed a listing guidance agreement, planning to list A shares.
The entire listing counseling work is divided into three stages. From September 2022 to December 2022, it is mainly to check the company’s basic information. From November 2022 to February 2023, it is mainly to conduct internal regulatory training for the company, mainly to let the company’s various The operations are all compliant. From March 2023 to the end of the counseling, it is mainly the final listing conditions and stock issuance preparations.
It can be seen that the market for smart locks has developed from a blue ocean to a red ocean. Around 2015, it experienced the "thousand locks war". Traditional hardware door lock manufacturers, Internet manufacturers, and home appliance manufacturers have entered the smart lock.
Today we will talk about the representative brand of smart door locks, Cadiz, and the entire smart door lock market.
01 Is smart door lock a good business?
From the perspective of daily needs, smart door locks can be unlocked through passwords, fingerprints, etc. With the development of technology, video and face recognition are also applied to door locks. Pain points in the use of keys, remote door opening, temporary passwords, etc. From the perspective of the product itself, there is a need for use.
In addition, according to RUNTO data, China's smart door lock market has grown from 8 million units in 2017 to 16.95 million units in 2021, and the annual shipments since 2018 have been more than 14 million units.
Summary of shipments of smart locks in China Data source: Luotu Technology
Calculated according to the 400 million households in China, the penetration rate of the entire smart door lock is less than 5%. In the later period, as the price of smart door locks further drops, consumers' awareness of smart door locks will further increase. For smart door lock manufacturers There is huge room for expectation.
The National Lock Industry Information Center predicts that in the next 5-10 years, the total output value of China's smart door lock industry will exceed 100 billion yuan .
02 The development history of Cadiz and the introduction of its founder
1. Company history
Kaidis was founded by Su Zhiyong in 2009. Su Zhiyong has been engaged in the lock industry since 1986. He sold 20 million sets of mechanical locks at the peak in 2004, and began to deploy smart locks in 2007.
In March 2013, Jiang Niangen, Xu Haiqing, and Li Guangshun established Cadish Smart with 3.5 million, 1 million, and 1 million registered capital respectively, with a total of 5 million registered capital. The 70% equity held by Jiang Niangen is actually on behalf of Su Zhiyong (Su Zhiyong is Cadiz Shi's actual founder) holds.
On April 20, 2017, the company's registered capital increased to 33.58 million. The original founders Xu Haiqing and Jiang Niangen transferred the 3.21% and 3.58% equity held by Li Guangshun, and the new registered capital was subscribed by Su Qiyun (Su Zhiyong's son) , the shareholding structure after the change is as follows:
Since 2017, new investment will be introduced basically every year, and the registered capital has also increased from the initial 5 million to 48.58 million yuan.
The main investors include well-known investment institutions such as Co-Stone Capital, Tongchuang Albert, Yijian Investment, Morgan Stanley, Lanxin Asia, and Asia Investment Fund. At the same time, Cadiz has also obtained a comprehensive credit line of 1 billion yuan from six major banks.
Financing situation of Cadiz
2. Founder introduction
Su Zhiyong can be said to be an old man in the door lock industry. He has been engaged in the lock industry since 1986. In the early days, he mainly focused on traditional mechanical locks. He has rich experience in traditional mechanical locks. He also created and sold 20 million sets in 2004. In 2007, Su Zhiyong gradually began to deploy smart locks, which also paved the way for today's Cadiz.
Su Qiyun served as the chairman of Cadiz in February 2019 and is also the legal representative. Su Qiyun is the son of Su Zhiyong, so it can be said that the son has inherited his father's business.
According to public information, Su Qiyun studied at the University of Alberta in Canada from September 2012 to September 2017 to study for an undergraduate degree. During the school period, he majored in economics and minored in mathematics. After graduation, he returned to China and worked in Cadiz. If Cadiz is successfully listed, another post-90s listed boss will be added.
03 Basic information of the company
1. Financial situation
According to public information, Cadish's revenue in 2018 and 2019 was 600 million yuan and 700 million yuan, respectively, and its profit was 114 million yuan and 58 million yuan, respectively .
In addition, according to market news, in 2020, Cadiz will ship more than 1.5 million sets through all channels . Based on the prices obtained by dealers, it is estimated that the annual revenue in 2020 has exceeded 1 billion yuan. On the road to listing, the revenue goal of 2 billion yuan may have already been included in the plan.
2. Major customers
Due to the limited market information disclosure data, here is only a brief introduction to the top five customers of Cadiz in 2018 and 2019. Among them, Shenzhen Yingkean Intelligent has been the largest customer for two consecutive years. The company has been canceled through Tianyan Check. The name is Shenzhen Kaidishi Electronic Commerce Co., Ltd.
In addition, Keaida and Kaidis Smart Security, two companies related to Kaidis, have appeared in the list of the top five customers for two consecutive years.
The top five customers also include Shenzhen Merit Technology and Zhongshan Internet Security.
Friends who know more about the above companies can also add materials.
04 Some factors for Cadiz to be able to successfully get out of the circle
1. Deep door lock gene
From the above introduction to the founder, we can see that Kaidish is a serious door lock company, genetically speaking, it has the natural property of making smart door locks, and smart locks are also products upgraded from traditional mechanical locks.
For Kaidishi, he has a very big advantage, that is, because he has upgraded from traditional mechanical locks to smart locks, he has very good resources and rich production experience for the hardware supply chain of the upstream lock itself. He has a deep understanding of door locks, so he actively embraces the Internet and has been laying out smart locks since 2007.
Whether it is for traditional lock companies or Internet companies with a large number of users, there are not many companies that have the advantages of supply chain resources and B/C sales experience. This is one of the main reasons why Cadiz can stand out from many door lock companies .
2. Deep cultivation of offline channels
Up to now, Cadiz has over 3,000 specialty store counters and tens of thousands of terminal outlets. For door locks, this product has strong construction attributes, that is, most consumers cannot install door locks by themselves after purchasing them. Rich installation Outlets, fast installation efficiency and quick response to problems during the use of door locks are crucial, which will directly affect the brand's reputation.
At the same time, for offline dealers, in addition to the profits of the product itself, the sales of door locks can also bring in service income, which will also increase the promotion of dealers.
In addition to offline channels, Cadiz has also captured real estate developers and some T0 B markets, including well-known real estate companies, long-term and short-term rental apartments, hotels and other scenarios.
3. Establishment of new retail channels
Smart door locks have gradually penetrated into thousands of households, and new retail has become a new main battlefield, especially online channels.
As users of smart door locks, more and more consumers will choose smart lock brands based on their own cognition, instead of the traditional door locks that are directly delivered by real estate manufacturers. Brand building is crucial.
In the early days of Cadiz's development, Cadiz mainly used German technology or German manufacturing as one of its selling points, so some people would say that Cadiz is a "fake foreign brand".
By 2017, Cadiz successfully signed a contract with the well-known artist Liu Tao as the product spokesperson. At the same time, the brand of Cadiz can be seen in major airports, high-speed rail and TV advertisements.
I personally think that this kind of brand investment has played a vital role in the development of Cadiz, which also laid the foundation for him to compete with Xiaomi.
According to Luotu data, in the first half of 2022, the online sales volume of China's smart door lock market was 1.912 million sets, a year-on-year increase of 27.2%; the sales volume was 2.5 billion yuan, a year-on-year increase of 22.6% . in the top three.
05 Players in the smart door lock market
1. Participate in the classification of smart door lock manufacturers
①Traditional hardware door lock manufacturers: Deschmann, Kaidish, VOC, etc.
②Internet manufacturers: Xiaomi, Luke, Lumi, etc.
③Cross-industry segmentation: Hikvision EZVIZ, TCL, etc.
Traditional door lock manufacturers have advantages in production and upstream supply chains. Internet manufacturers have a large number of users and the ability to operate with consumers. Other cross-border entry into the door lock industry also bring door lock products through the channels opened up by their original product lines. .
So on the whole, although the competition is extremely fierce, there are still differences in the main market of each company.
According to data from Luotu Technology, in 2021, Xiaomi will continue to be the number one online brand, and the two traditional lock companies, Kaidish and Deschman, have begun to make efforts online, and the overall online sales have steadily increased.
In 2021, Xiaomi, Cadiz, and Deschmann will rank among the top three in turn, while the rankings from fourth to tenth will change frequently every month. Looking at the whole year as a whole, General Shi, Huanlu, and TCL have a significant year-on-year increase; Luke , Yiens, Wujiang, and VOC occupy the remaining seats of the TOP10 brands.
2. Financing situation of some manufacturers
Luke Technology has raised 15 million yuan in the A round since 2015, and its valuation in 2018 has exceeded 1 billion yuan. As of May 7, 2022, it has reached the F round of financing. Investment institutions include well-known investment institutions such as Xiaomi, Shunwei Capital, Baidu, Fosun Group, and Red Star Macalline.
Luke Technology has launched three brands of "Luke", "Yunding" and "LOCKIN" respectively for the home market, commercial rental market and overseas markets.
In April 2016, Deschman received 123 million yuan in round A financing from Ronghai Investment, and then received round B and C rounds of financing in 2018 and 2021 respectively. The D-round financing of investment institutions such as China Holdings, Matrix Partners, and Gome Capital.
06 Cadiz's challenge
For Cadiz, there is still a long way to go from the listing counseling to the final smooth IPO. Of course, this is definitely not a smooth road, and the process is also full of challenges.
1. The price continues to drop
After several years of development, a large number of companies have entered the door lock industry. There are small white-label companies and giants like Xiaomi, whose sales prices have been dropping in the face of fierce competition.
Now ordinary smart locks have reached the range of 1,000-2,000 yuan. Of course, for some apartment places, the possible price has reached several hundred yuan.
Therefore, for Cadiz, the continued price drop will have a certain impact on gross profit margin.
2. There are wolves in front and tigers in back
As mentioned earlier, there are many manufacturers participating in the smart door lock industry, and most of these manufacturers are either listed companies or have large-scale financing, and they all have strong strength and background. Quite a lot.
Sometimes I think that the risk of competition among peers may be relatively more controllable, but what is scary is the new players entering the field across industries .
Since these new players are new to this field, they may break the original rules of the game. For example, in the early stage, some will sacrifice profits to fight price wars in order to seize the market, such as using some other advantageous products of the whole house smart to bundle door lock sales. , There are also segments of people who specialize in positioning high-end door lock brands to carve up the original door lock market, etc.
Through this kind of competition, the Matthew effect in the door lock industry will become more obvious in the future, and the main market will be occupied by leading companies.
3. The product repurchase rate is low
Smart door lock products are strongly related to home building materials. It is a product that is used frequently but replaced infrequently. Generally, after installing a smart door lock, it is rarely replaced and upgraded frequently.
If you want to expand the market, you can only continue to explore the first-time buyer customer group and some B-end customer groups.
07 Written at the end: some personal views
As an old player in the door lock industry, Cadiz naturally has a deep understanding of the rules, gameplay and market of the door lock industry.
Here I dare to talk about three personal opinions. If there are mistakes or immaturity, I hope everyone can correct me and communicate.
1. Door locks are the foundation of Kaidish. Should we consider expanding product lines and product categories when the market share of basic products is not bad?
The expansion of product categories mentioned here must be based on the technology of door locks. Aimless expansion of product categories will only distract one's limited energy and thus lose focus on core products.
From the analysis of competitors, Xiaomi has a mobile phone business and an ecological chain business, TCL has a home appliance business and a smart home business, and EZVIZ has a security camera business and a smart home business.
These competitors will use their advantages in the main business to carve up the market of Kaidisi door locks, thus greatly reducing Kaidisi's fault tolerance rate in the door lock industry.
From the perspective of Cadiz itself, it currently has good channels and popularity both online and offline. If it expands peripheral products that match door locks, it will be a very large incremental market for Cadiz. It is equivalent to saying that two products can be sold for the cost of one advertisement.
At the same time, through the entrance of smart home door locks, we can slowly cut into the smart home market with a larger market space, so that consumers and Cadiz will be more sticky.
2. Market sinking
Chairman Mao put forward the struggle to "encircle the cities from the countryside". As far as smart lock products are concerned, the cities must be the first to popularize the market, especially the first-tier cities.
And the vast second-, third-, and fourth-tier cities will surely become a market with a relatively high share in the future, after all, there is a population base. Just like the rapid rise of Vivo and OPPO is inseparable from the contribution of second- and third-tier cities.
Therefore, the promotion channels and promotion methods also vary from place to place and from person to person. The points of concern of the older generation of parents must be different from the points of attention of young people, so you cannot use one set of strategies.
3. Paving the way for overseas channels
Smart locks have developed rapidly in China in recent years, which has a lot to do with the prosperity of the real estate industry and the improvement of people's consumption power.
In addition to the huge domestic market, the overseas market cannot be ignored.
According to statistics, the penetration rate of overseas smart locks has exceeded 50%. But from my point of view, one is that the overall overseas market capacity is still a very large volume, and the other is whether there is such a high penetration rate overseas. Another question, from another perspective, the higher the penetration rate, the lower the difficulty of popularization.
Therefore, I personally think that investment in overseas channels and the construction of overseas brands are still very necessary. Of course, exporting overseas business may also help to increase profit margins.
The above content refers to Luotu Technology, 36Kr, China Securities Regulatory Commission and other Internet information. If there is any infringement, please contact the background in time.
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