There used to be a hot post on Zhihu Inc. entitled "what unimpressive but profitable businesses". In the business world, there are also some low-key money-making machines-Fuling, who makes mustard, Haitian, who sells soy sauce, and Lao Gan Ma, who specializes in Douchi. And today our story protagonist, the bull who sells sockets.

As the Bulls Group, which just went public last year, the latest annual report for 2019 is very eye-catching. With 10 billion revenue and more than 2 billion profits, not only most A-share companies are left behind, but also the market capitalization once exceeded hundreds of billions of yuan.

With more than 2/3 market share of socket converters in China, Bulls are the unchallenged kings of national brands and the biggest domestic competitors of world industrial control giants such as Philips and Siemens.

But if that's all, can it really support a market capitalization of hundreds of billions?

Guotai Junan light industry team released an in-depth report in the early days, taking a close look at the secret of the rise of this low-key giant.

A bull who doesn't recognize it.

In the 1990s, hundreds of socket workshops, large and small, were scattered in Cixi, then China's socket distribution center, and Ruan Liping, the founder of the bull socket, also grew up here.

After graduating from Wuhan University of Water Conservancy and Electric Power, Ruan Liping will also help sell and repair sockets after work. In the process, he found that the quality of the sockets made in the workshop was generally poor, and one in three was bad.

Aware of users' demand for secure sockets, Ruan Liping decided to resign and start a business.

In 1995, with the belief of making safe and unbreakable sockets, Ruan Liping borrowed 20,000 yuan to set up the Bull Electric Appliance Company, and personally designed the products and put them into production.

Since its inception, the bull socket has been running all the way, and now it has formed a business combination of safety sockets, decorative switches, Eye LED, digital quick charging accessories and so on, and has become a well-known public brand.

"Safety" and "reliability" is the foundation of the bull socket, and attaching great importance to technology research and development and product innovation has become the company's unshakable core strategy.

In 2015, XIAOMI socket, worth 59 yuan and with a hint of "Internet temperament", was born. The socket was once popular among young consumers because of its compact design and three USB charging jacks.

In the face of XIAOMI's cross-border challenges, the bull's response speed also exceeded the industry's imagination.

Just three months later, the bull launched a product that is quite similar to XIAOMI's patch board. Quality word-of-mouth + fashion design makes this product equally popular.

But the bull's reflection doesn't stop there. In early 2016, the bull launched a "digital boutique strategy" to target young users.

Among them, the Niu Rubik's Cube USB socket with three groups of five-hole sockets and three sets of USB charging ports has been sought after by many fans for its simple shape and easy to carry.

In 2019, the MFi certification launched by Bull (a logo license for Apple Inc to authorize accessories vendors to produce external accessories) Apple Inc data line products are of excellent quality and even exceed the original data line, and the price is only about half of that of the original line. It sells well on the e-commerce platform and is very popular as soon as it is launched.

Ruan Liping once said publicly that looking back, he would like to thank XIAOMI and XIAOMI for letting the bull keep up with the trend of the Internet and discover the needs of users so that they will not be eliminated by this era.

However, the speed of the bull's response to this incident and the ability to further product evolution reflect that the company is not only a follower of the new trend, but also has an innovative product design concept and an efficient R & D system.

"shop moves"Another secret to the rise of the bull

The success of the bull, in addition to excellent product research and development, is also inseparable from years of deep ploughing channel construction.

On the head of the hardware store in the streets, such a sign is no stranger to many people-bulls, socket leaders.

It is such a signboard, coupled with a nationwide distribution network, that contributes more than 80% of Bulls' performance each year.

By guiding dealers to carry out innovative sales models such as distribution and sales visits, the Bulls are able to connect the country's small and scattered hardware channel outlets into a network, and integrate the manufacturing industry with the service industry.

Bulls have long adhered to the brand promotion model with "shop recruitment" and other point-of-sale advertisements as the core, which has set up marketing channel barriers and brand advantages that are difficult to replicate in the field of converters, and laid a solid foundation for the expansion of new categories.

The company's distribution system is divided into converters, wall switches and sockets, digital accessories three modules, sub-regional, high-density network to infiltrate the country, and directly to the user terminal.

The bull is promoted in the field of civil electrical engineering."Distribution and sales visit"Offline sales model is the first in the industry. The company's channel construction team creatively integrates the manufacturing industry with the service industry, including four major measures: training, support and in-depth services for dealers, and organizing dealers across the country to deploy special vehicles in their distribution areas. equipped with professional sales and service personnel in accordance with the network layout and established routes, regular distribution, delivery, visit service and door-to-door sales.

In terms of effect, the number of large dealers of the bull has increased steadily, and a benign coordinated development has been formed between the company and dealers to enhance the market share in their respective fields.

The business transformation is beginning to bear fruit.

With more than 20 years of efforts, the Bulls Group has made the small industry of sockets very successful by relying on high product quality and high-quality sales channels, and its market share of more than 66% shows its dominant position in this subdivision field. Become a veritable "socket number one".

Many enterprises that achieved great success in offline channels in the last era were surpassed by the same industry in the Internet era, often because the traditional channel departments were too strong, resulting in ineffective development of e-commerce channels and missing a new wave of era dividends.

However, the bull is clearly not on this list.

In 2015, the company complied with the changing trend of consumers' purchasing methods, actively opened up new channels for e-commerce, achieved an appropriate distinction between online and offline products, and strengthened the promotion of the company's brand and products without conflict, to build a three-dimensional channel system.

At present, the construction of e-commerce channels has achieved remarkable results and achieved rapid growth, which provides a strong support for the overall growth of direct sales channels.

Revenue from direct sales channels grew at a compound growth rate of 36.77% from 2015 to 2018, of which e-commerce direct sales revenue increased from 239 million yuan in 2015 to 834 million yuan in 2018, a compound growth rate of 51.7%.

On the other hand, the company's product structure and product positioning adjustment based on product competition strategy have achieved remarkable results, promoting the rapid growth of income growth.

In 2019, the sales income of bull digital accessories products was only 7.5117 million yuan. After cultivation in recent years, it achieved rapid growth, reaching 277 million yuan in 2018, and revenue reached 176 million yuan in the first half of 2018, fully reflecting the driving force of the rapid growth of new categories.

Among them, the data line in the product structure has greatly increased the proportion of Android data line sales with lower unit price, and began to implement injection head and assembly self-made on a large scale since 2018.

Mobile power supply changes the main products from high-end commercial positioning to young popular positioning, and the product self-control rate and production technology continue to improve.

Car charging and charging heads also offer products that are competitive in appearance and cost.

In 2019, on the basis of the successful "Niu Rubik's Cube" socket, the Bulls announced a partnership with South Korea's popular IP Line to release the joint money Bull LINE FRIENDS Little Rubik's Cube, which once again properly won a group of female fans.

Originally the most traditional socket business, Bull Group can seize every wave of dividends in the two areas of products and channels, making the capital market full of expectations for its future development. This may be the core reason why it has achieved hundreds of billions of market capitalization empires.