Under the wave of digital transformation, various industries are constantly upgrading and evolving. However, the digitalization methods of leading enterprises and small and medium-sized enterprises in various fields are different. Leading enterprises have strong financial strength. For the construction of digital architecture, they often promote the construction of internal departments and external cooperation. However, small and medium-sized enterprises are slightly lacking in investment in R&D resources and understanding of digitalization. Therefore, they rely on SaaS to promote Cost reduction and efficiency increase is a mainstream path.
The needs of small and medium-sized enterprises have stimulated the growth potential of the SaaS industry. Take finance and taxation SaaS, which is currently maintaining a high-speed growth trend, as an example. According to the Jiaziguangnian report, the scale of my country's smart finance and taxation market will reach 69.7 billion yuan in 2021, and the compound annual growth rate in the next five years will be 15%. It can exceed 100 billion.
Among the many taxation SaaS companies, Huisuan, as the largest provider of financial and taxation solutions for small, medium and micro enterprises in my country, has attracted much attention. In the past five years, it has raised close to 1.3 billion yuan, with a rich lineup of shareholders, including well-known institutions such as IDG Capital, Xiaomi, Gaocheng Capital, Sunshine Life Insurance, and Tencent. So, what is the competitive advantage of Huisuan that is favored by capital?
Penetrating the financial and taxation needs of small and medium-sized enterprises, Smart Accounting acts as a smart housekeeper
In 2014, the introduction of the strategy of "Mass Entrepreneurship and Mass Innovation" has spawned a large number of small, medium and micro enterprises. As of January 2023, my country's market entities have reached 170 million, of which the total number of small and medium-sized enterprises has exceeded 50 million, and the number of newly registered enterprises has exceeded 8 million.
Small and medium-sized enterprises have a large scale and occupy a pivotal position in my country's economic volume, but at the same time, various demand gaps at the fiscal and taxation level are becoming increasingly prominent.
From a macro perspective, the taxation mechanism cannot provide precise services for small and micro individuals. For example, the current taxation service supervision is mainly based on taxpayer complaints and feedback.
From a micro perspective, it is difficult for small and micro enterprises themselves to balance the cost and quality requirements in terms of tax compliance and efficiency. First, many managers lack professional knowledge of finance and taxation, and their understanding of tax policies and regulations is not accurate enough; second, the financial management system of small and micro enterprises is not perfect, and they lack effective internal control mechanisms, making it difficult to conduct timely and accurate analysis of financial data and management; third, small and micro enterprises need to spend a lot of time and labor costs in compliance with fiscal and taxation regulations. With the development of the taxation mechanism and the more complex business of enterprises, it will become more and more difficult for SMEs to independently improve their fiscal and taxation capabilities and improve the overall quality of operations.
The rise of third-party service providers is based on this background, and the greatest value of their growth is to meet basic fiscal and taxation needs at a relatively small individual cost, and then gradually deepen business operations to create more added value.
However, different taxation SaaS companies also have different business directions. Large companies are expanding horizontally, and new players are constantly moving towards the depth of the subdivision track. For example, Kingdee and UFIDA started to develop new businesses such as financial and tax consulting, financial and tax training, and credit business after the customer scale of customized SaaS was formed, and they are committed to becoming large-scale comprehensive financial and tax service providers. However, Hesi, Fenbeitong, Huilianyi, etc. use the "single-point sharp knife" strategy to cut in from the expense control and reimbursement scenario, trying to achieve the ultimate expense control and reimbursement SaaS; Huisuanac aims at the needs of small and medium-sized enterprises for bookkeeping, providing various value-added services, etc.
From the perspective of market demand, small and medium-sized enterprises under the traditional bookkeeping mode in the past had limited bookkeeping efficiency, high error rate, and irregular and insecure financial data. The loopholes in bookkeeping work often lead to tax risks. Therefore, starting from agency account services and then extending to tax services is a direction that fits the actual business of small and medium-sized enterprises, and it is easier to establish a competitive advantage. It is through this development route that Huisuanac has become the leading enterprise in the financial and taxation solution industry for small, medium and micro enterprises in my country, and its market share will also rank first in 2022.
However, Huisuanlu is not a potential stock derived purely from market demand. Its business model has the following characteristics.
One is the manifestation of the scale effect of the industry. The more cases there are, the smarter the system and the stronger the competitiveness, forming a positive cycle in Huisuanlu. Due to differences in taxation policies in different regions, the financial and taxation needs of small and medium-sized enterprises are also cross-regional and highly individualized. It is difficult for financial and taxation SaaS service providers to provide standardized or generalized products and services to meet the actual needs of the market. Therefore, it is necessary to establish A channel system that can serve customers in different regions, sizes and industries.
However, there are not many finance and taxation SaaS vendors with customers in the direct chain market. For example, the main business is agency bookkeeping. The cloud account room does not directly serve small and medium-sized enterprises, but mainly serves third-party accounting companies. The set of "direct sales + franchise" sales and service channels for small and micro enterprises has covered more than 400 cities across the country, with more than 500 regional service agencies, and the scale effect has become increasingly prominent.
The second is the driving force behind the promotion of the positive cycle. Smart Accounting grasps the trend of smart taxation, releases technical power, strengthens product power, and can continuously provide small and medium-sized enterprises with the value of compliance, cost reduction and efficiency increase.
Specifically, technical strength is crucial to taxation SaaS companies, and companies with stronger technology can be the first to develop more advanced and powerful products, thereby preempting the market. Under the trend that the industry pays more and more attention to improving the technical level, Huisuan continues to integrate emerging technologies into products, improve the SATP system, and increase its R&D investment year by year, reaching 50.789 million yuan, 69.878 million yuan and 85.824 million yuan in 2020-2022 respectively , thus forming a certain technical advantage.
For example, Huisuan is the first in the industry to apply AI technology to financial and tax solutions, using its own machine learning model to build the accounting engine of its own financial and tax SaaS tools, which will help Huisuan to better mine the data accumulated by a large number of users in the future value. At present, Huisuanling has accumulated about 262 million multi-dimensional model parameters related to small, medium and micro enterprise business and financial and taxation processes from more than 224 million bills, forming the largest parameter set in the industry.
The continuous expansion of the market and continuous improvement of technology also help to highlight the brand value of Huisuan. It can be seen that Huisuan, which penetrates the financial and taxation needs of small and medium-sized enterprises, is gradually becoming the financial and taxation intelligent steward of small and medium-sized enterprises, and with the gradual improvement of its commercialization capabilities, the turning point of advancement is approaching.
Commercialization capabilities are gradually improving, and the inflection point of advancement is approaching
Through a wide range of service channels and product research and development that closely follow market demand, Huisuan has built a long-term moat and achieved continuous growth in short-term performance. It is understood that from 2020 to 2022, the revenue of Huisuan will be 280 million yuan, 350 million yuan, and 520 million yuan respectively, with a compound annual growth rate of 36.9%, and the gross profit margins will be 44.5%, 49.4%, and 52.0% in the same period, showing an increase. trend. From the perspective of the development trend of the industry, Huisuan will further clarify its future prospects with more optimized business operations.
First of all, enterprises will eventually move towards the integration of business, finance and taxation, and correspondingly, there will be more demands for unblocking congestion points and in-depth trusteeship. quality.
Specifically, at present, the business departments and financial departments of many enterprises are managed independently, and the business, financial and tax information is not unified, and the internal control costs in communication and collaboration, cost control, risk management, etc. are huge. Based on this, the integration of industry, finance and taxation has become an urgent need for enterprises to improve the quality of development, especially under the guidance of the digital economy, policies such as "Opinions on Further Deepening the Reform of Tax Collection and Administration", "Outline of the 14th Five-Year Plan for Accounting Reform and Development" and other policies continue to advance , the trend of integration of business information flow, capital flow, and bill flow will become clearer.
The key to the integration of business, finance and taxation for enterprises lies in the integration and data sharing of business and financial processes. The first step requires enterprises to transfer offline processes to online, and the second step is to integrate business and financial processes and information through a system to achieve data connectivity.
At present, there are not many platforms that can meet the above needs in terms of functions, such as Youwei Fee Control Management System, Ufida NC, Kingdee Xingkong Financial Cloud, Huisuanlu STAP, etc. can be easily realized. From this, it can be foreseen that as finance and taxation SaaS gradually enters the stage of stock competition, the iterative logic of products and the grasp of market demand will be the key to the competitiveness of enterprises.
In terms of product performance, Huisuanlu is slightly inferior to Kingdee, UFIDA and other large comprehensive service providers in terms of data integration functions. For example, Kingdee Xingkong Financial Cloud can not only link financial and tax information, but also link financial and tax data to banks, as well as archives. Management and other aspects of human resources, these are currently not available in the STAP system of Smart Accounting.
But Huisuan’s advantage lies in the logic of its product updates. Piaoyitong SaaS experts believe that after the integration of industry, finance and taxation, it will be a financial-driven business, which requires the SaaS platform to have stronger and stronger capabilities in budgeting, analysis, early warning, data security, etc., and requires a large number of customers to enable The product is constantly polished and perfected in the actual scene. This is good news for Huisuan, which has a huge "direct marketing + authorized cooperation" channel.
In 2022, the number of micro, small and medium-sized enterprises served by the SATP system will reach 711,300, while Kingdee Cloud Xingchen, which serves small and medium-sized enterprises under Kingdee, will accumulatively serve just over 30,000 customers. In the future competition, Huisuanlu's advantage in customer acquisition is expected to boost its product-level advantage.
In addition, as the Golden Tax Project continues to advance, the original data management platform of the tax system will gradually establish a scientific data sharing, supervision, and security mechanism to achieve real-time synchronization of tax data across the country, some data collection and preliminary review, data standardization, and sharing. Functional modules such as query and risk control will also be launched to improve tax work efficiency and management level.
On the whole, national policies encourage the establishment and optimization of taxation mechanisms. At the same time, the SaaS industry relies on its keen grasp of the market and regulatory advantages to help small and medium-sized enterprises fill in the blank areas that cannot be covered by taxation services. This fiscal and tax service ecology jointly established by the government and the market can greatly reduce the compliance costs of small and medium-sized enterprises. Under the resonance of various factors, the future of financial and taxation SaaS companies such as Huisuanlan is worth looking forward to.
Author: Good blue is not good
Source: Songuo Finance