In China, many people know that software is best sold in combination with hardware to obtain higher profits. The hidden meaning behind this is that software is a business, and the Chinese think that it is a good business without hardware .
In the 2019 Top 100 Chinese Software Enterprises List released by the China Electronics and Information Industry Federation, the number one software enterprise is Huawei. Huawei is a typical example of software + hardware sold together.
Now when doing SaaS in China, many investors and entrepreneurs have a common view, that is, they must do SaaS+, that is to say, it is not enough to sell software alone, but to combine software with other types of business, either as an advertising agency or as a matchmaker. , either collect payment and loan commissions, or sell course content, or sell skin templates. Although, any other type of business has the characteristics of other types of business, and has the threshold and doorway of other businesses. If you blindly rush into other businesses, the probability of becoming cannon fodder is extremely high. But everyone still thinks to do SaaS+ because many people think that other types of business are better than software business . You have to cut into other business fields by making software.
Another example, why is HR SaaS more popular than CRM SaaS recently? If we talk about SaaS alone, the demand of enterprises for CRM is definitely stronger than that of HR, but the sales model of each enterprise is different, so it is relatively difficult to superimpose CRM with other services, and the gap in the demand for human resources related services of each enterprise is not so big Big, so easy to add other services.
This is indeed the case, so what is the reason behind it?
First, there is still the issue of intellectual property rights, and the remnants of piracy thinking have not disappeared.
Although various anti-piracy, anti-cracking, and Internet account technologies have greatly solved the problem of piracy. However, this kind of thinking has not been completely resolved. This kind of thinking is not paying attention to intellectual property rights. A large number of people are unwilling to pay, or pay a lot, for invisible and intangible intellectual property. For example, DingTalk is currently used by millions of companies, but if DingTalk charges, I estimate that more than 95% of enterprise users will be lost. Books in China have always been very cheap, and this is also the reason.
Individuals have such an idea, which drives small business owners to have the same idea. This indirectly leads to the loss of the soil for cultivating excellent software companies.
Second, focus on resources, not efficiency. utilitarianism
Software is just a production tool, and good software can naturally improve the production efficiency of individuals or enterprises. In many cases, the improvement of efficiency cannot be seen immediately, and it often needs to be invested first, and then improved.
In contrast, Chinese people prefer things that can have immediate results, such as introducing me to a client or a relationship.
A software colleague said that the owner of 5,000 yuan would think it too expensive to sell software to restaurants, but he would not blink his eyes at 5,000 yuan if he said he wanted to place an advertisement for restaurants.
China is the world's largest consumer market, but in terms of software industry consumption, China's market is actually not that big.
Third, lack of good products
There are many companies with software talents, but not many companies use software talents to make good software products. Many companies use software talents as raw materials and sell them directly to customers. This is called a software outsourcing company. In 2019, Chinese software companies In the top 100 list, you can see many software outsourcing companies, such as Chinasoft, Neusoft, and Pactera.
Compared with making products, it requires a lot of investment in the early stage, and the risk is greater. In the software outsourcing industry, customers are billed on a per-day basis, and payments are collected on a regular basis, with relatively low operating risks. As a result, many companies have turned to software outsourcing services instead of developing software products. Local governments have also begun to prefer the software outsourcing industry, because more people are employed by the software they solve.
But the more this is the case, the harder it is to make good software products.
How to measure whether a company's product is good or not? Generally speaking, there are only two criteria. Customers are willing to spend money or time on your product. In the field of enterprise software, it is mainly money. Only when customers are willing to pay for the license (or rental fee) can it be called a good product. Of course, if foreign customers also pay for your product license (or rental fee), it will prove to be a good product.
Cash flow?
For most software, it is difficult to find a real profit point.
If it is to provide a unique charging function, the first is difficult, and the second is easy to be imitated by pirates.
If it is among the many function points, small charges may be relatively simple, which also means that the software you make has very large functions, and different users can find consumption points when they come. That is to say: the supermarket model is still The easiest way to make money is to pay less for a large population. This also means that domestic software is generally low-level. In the domestic environment, almost no one is willing to pay tens of thousands a year to use a software product. This also makes it more difficult to produce high-level software in China. .