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Putin called on Russia and the United States to restart bilateral cooperation in the field of information security, and the United States refused and involved China.

　　[Global Times special correspondent Li Yong Liu Yupeng Wei Hui] What card is Putin playing? With the approaching of the American election, the accusation of "Russian interference in the election" is getting louder and louder in the United States. Under this background, Russian President Vladimir Putin unexpectedly put forward a proposal of "attacking from defense" on the 25th — — Call for an agreement with the United States to "restart" the relationship between the two countries in the field of information security and not interfere in each other’s internal affairs such as the election process.

　　Some American media described the proposal as a "cyber truce", arguing that Russia’s move was on the one hand to prove its innocence, and on the other hand to prepare for the "post-Trump era" in which Biden might win the election. However, this well-intentioned proposal was quickly rejected by Washington, and a spokesman for the US National Security Council said that the proposal "may be to create further divisions in the United States." This result is expected by Russian analysts. In the eyes of Russian media, the United States has gone further than anyone else in conducting information warfare and interfering in elections, and has more means than anyone else. How can it be willing to "tie itself up"?

　　The United States quickly refused, and China "lay a gun."

　　"One of the main strategic challenges of our time is the risk of large-scale confrontation in the digital field, and the special responsibility for preventing such conflicts falls on key participants in the field of international information security." According to Reuters, the Kremlin issued Putin’s statement on 25th, calling on the United States and Russia to reach an agreement to ensure that they will not interfere in each other’s elections through the Internet. The statement said that Russia and the United States need to promise each other not to interfere in each other’s internal affairs, including the election process, by means of information technology and high technology.

　　According to the report, Putin suggested that the two countries reach an agreement to prevent major events in cyberspace. The agreement is similar to the Agreement between the United States and the Soviet Union on the Prevention of Accidents on the High Seas and Over the Sea signed in 1972 at the height of the Cold War. RIA Novosti said on the 26th that Putin called on the two countries to resume comprehensive inter-departmental dialogue on key issues to ensure international information security, and to keep the communication channels between the competent departments of the two countries unimpeded and effective in reducing nuclear dangers and computer accidents. Putin finally pointed out: "I propose to all countries, including the United States, to conclude a global agreement, and all countries make political commitments not to use information and communication technologies to attack each other first."

　　"Unexpected and somewhat mysterious," Buzzfeed News Network described Putin’s statement. The New York Times reported Putin’s proposal with the title "Putin wants a truce on the Internet, but denies Russian interference". The article emphasizes that apart from soothing language, the statement does not imply that Moscow is prepared to make any specific concessions.

　　Such a constructive proposal was quickly rebuffed by the United States, and China was once again "lying down". The New York Times said that US National Security Council spokesman John Uliott responded to Putin’s proposal: "When Russia, China, Iran and other countries try to undermine our election process, it is difficult for us to take such remarks seriously." Uliot also said: "This proposal may be to further create division in the United States." Buzzfeed News Network said that the White House understood Putin’s call for Russia and the United States not to interfere in elections, and made its own response: Russia should stop interfering first. A senior White House official said: "The starting point of good consultations is that Russia will stop its ongoing interference in the US election."

　　The response of the United States is expected for Russia. Russian newspaper Izvestia reported on the 26th that Chepa, vice chairman of the International Affairs Committee of the Russian State Duma, said that Russia has repeatedly proposed to the United States to strengthen cooperation in all directions. Unfortunately, the United States has always rejected this. Even if the American political circles still have no positive views on Putin’s initiative, it will be more difficult for the United States to accuse Russia of interfering in its general election, because Russia has extended its own hands and called for cooperation. Lozansky, president of American University Moscow, said that some political elites in the United States are firmly opposed to improving relations with Russia. Trump may want to cooperate, but any positive signal is not good for his campaign.

　　Russia prepares for the "post-Trump era"

　　Why did Russia put forward such a proposal when it knew that it might encounter a rebuff? In the opinion of public opinion, this is a tactic adopted by Moscow in the current situation. Originally, the accusation of "Russian interference in the 2016 presidential election" has been going on in the United States, and with the approaching of the new election polling day on November 3, the new accusation of Russian interference in the US election is once again rampant.

　　The New York Times said that with less than six weeks to go before the US presidential election, Biden, a former vice president who bluntly criticized the Kremlin, may enter the White House. Putin’s appeal at this time, at least to some extent, is to show a more friendly face in response to the recent statement of American officials that "Russia has secretly increased its efforts to weaken Biden." Christopher Babers, director of the Federal Bureau of Investigation (FBI), warned last week that Russia is actively carrying out actions against Biden and spreading false information. According to Washington post, the US Central Intelligence Agency (CIA) assessed in August that Putin and his senior aides "know and may guide Russian influence actions" to weaken Trump’s opponent Biden in the 2020 general election.

　　"Putin is ready for a future without Trump," Bloomberg said. People close to the Russian leadership said that although few people think that if Trump is re-elected, relations between the two countries will have improved prospects, Biden’s election will be bad news for Russia. Kremlin analysts are stepping up the deduction for Biden’s election as president. According to informed sources, Russia is increasingly worried about the prospect of the White House without Trump, and is trying to determine what this means for sensitive issues from nuclear weapons to energy exports and sanctions.

　　According to reports, Moscow’s fascination with Trump has faded. Russian officials said that no matter who is in the White House, the "Russian phobia" in the American system will not change. However, the two candidates have different attitudes towards Russia. Trump said last week that China and postal voting are more threatening than Russia; Biden, on the other hand, said that he would make Moscow pay the price for interfering in the election and regard Russia as an opponent.

　　Russia has always firmly denied the allegations of interference in the general election. "Russian Intervention 2.0", Sputnik said that although no substantial evidence of Russian intervention in the 2016 US election process could be found before, some US officials began to claim that Moscow once again used "a series of measures" to intervene in the 2020 election and "vilify" Democratic presidential candidate Biden. In recent weeks, American officials have stepped up their accusations. The Kremlin denied this, calling it "nonsense". Russian Foreign Minister Sergei Lavrov stressed in his statement on 25th that, as we have repeatedly pointed out, the statement about Russia’s intervention in American elections is groundless. "We are in favor of professional and constructive discussion on all existing issues and propositions at the negotiating table".

　　"Frozen soil covers US-Russia relations"

　　"If the United States is worried that Russia and other countries will interfere in the general election, then it should sign an information non-aggression agreement as proposed by Putin." Sputnik quoted Shatilov, a professor at the University of Finance and Economics of the Russian Federal Government, as saying on 26th that we saw how the United States carried out active information publicity activities for other countries, but at the same time accused other countries, especially Russia, of interfering in its elections. The United States has been launching an information war all over the world, never considering ethics. It has allocated huge sums of money from its budget to carry out information publicity activities in Russia, Belarus and other countries. It is impossible for the US government to give up this tool of interfering in other countries, so it will find reasons to reject the Russian proposal. Russia’s "Today’s Economy" said that no matter what the outcome of the US election in November is, the United States will accuse other countries of interfering in the election.

　　"Frozen soil covers US-Russian relations", and the article in "Asia Times Online" on 25th vividly describes the situation of US-Russian relations — — Even with a president like Trump, it is difficult to change. In addition to the quarrel about "interference in the general election", the article refers to the recent poisoning incident of Russian opposition figure Navalny, saying that a group composed of senators from both parties in the United States proposed to impose further sanctions on Russian officials.

　　"The relationship between Russia and the West has further deteriorated in recent weeks." The New York Times said that Lukoyanov, a Moscow foreign policy analyst who advises the Kremlin, said that the cybersecurity proposal highlights that Putin’s mood is much more relaxed now than it was at the height of the Ukrainian crisis five years ago. However, he said that the United States has a deep-rooted distrust of Russia, and he does not expect Washington to take the proposal seriously. If Biden is elected president, relations between the two countries may deteriorate further.

Price reduction strategy of good shops： market adaptation and the future trend of leisure snack industry

□ Huang Wanying (Shanghai University of Finance and Economics)

On November 30 th, the news that good shops will cut prices on a large scale attracted attention. It is reported that the average price of more than 300 products sold in this price reduction store has been reduced by 22%, with the highest drop of 45%. On November 29, Yang Yinfen, the helm of the good shop, sent an internal open letter to all employees, saying that the cost should be reduced and the price should be close to the people. (December 1, Beiqing Net)

The price reduction strategy of good shops is not only a sensitive response to the current market environment, but also an active adaptation to the future snack industry trend. Under the background of increasingly fierce competition in the snack industry and increasingly diversified consumer demand, the price reduction measures of good shops show their market insight and adaptability.

First of all, from the perspective of consumers, the price reduction strategy of good shops is undoubtedly a positive response to changes in consumer demand. At present, consumers are demanding more and more cost-effective, especially in the context of increasing economic pressure, high-quality and reasonable-priced products can attract consumers more. The price reduction of good shops is based on the changing trend of this consumer market, trying to attract a wider range of consumer groups by lowering the price threshold, so as to maintain its competitiveness in the market.

Secondly, from the perspective of industry competition, this strategy of good shops is also an adaptation to the changes in the internal competition pattern of the industry. With the further subdivision and specialization of the snack market, consumers’ choices of brands and products are more diverse. The price reduction of good shops may force other brands to adjust their prices, thus promoting the price remolding of the whole industry and triggering a new round of market competition.

In addition, good shops emphasize maintaining product quality while reducing prices, which reflects their persistence in brand core values. In the current market environment, price competition alone is not enough for a long time. Good shops show their comprehensive and balanced market strategy by adjusting prices on the premise of ensuring product quality.

However, in the face of such a large price reduction, good shops also need to consider the possible financial pressure. Although price reduction may attract more consumers and increase sales in the short term, in the long run, companies need to pay more attention to cost control and improvement of operational efficiency to ensure that profit margins will not be affected too much because of price reduction.

Finally, the price reduction strategy of good shops is a positive adaptation to the current market environment and a forward-looking investment in future market trends. Through this price reduction, good shops may not only expand their market share, but also promote the development of the whole leisure and snack industry to a more reasonable price and quality balance. But at the same time, it is also a challenge. Good shops need to finely manage their costs and operations on the premise of maintaining quality to ensure long-term sustainable development.

Ningbo Yidong is offering a discount! The latest offer is 69,900, and the car is sufficient.

[car home Ningbo Preferential Promotion Channel] At present, a large discount is being made in Ningbo, with the maximum discount amount of 24,000 yuan and the minimum starting price of 69,900 yuan. For friends who need to buy a car, this is undoubtedly a rare opportunity to buy a car. If you are interested in Yidong, you may wish to click "Check the car price" in the quotation form to get a higher discount.

宁波逸动正在优惠！最新报价6.99万，现车充足

Yisheng adopts a dynamic and smooth design, and the front face is equipped with a fashionable air intake grille with sharp LED headlights, showing a strong visual impact. The body lines are smooth, and the overall style is simple and modern. The waistlines on both sides of the body outline a sense of output, while the tail adopts a fashionable taillight design, which adds a sense of modernity to the whole car.

宁波逸动正在优惠！最新报价6.99万，现车充足

With a body size of 4730*1820*1505mm and a wheelbase of 2700mm, Yixing has smooth lines and an elegant sense of movement on its side. Equipped with 16-inch wheels and 205/60 R16 tyre size, the stability and handling performance of the vehicle are enhanced.

宁波逸动正在优惠！最新报价6.99万，现车充足

Yisheng’s interior design is simple and fashionable. The center console adopts a 10.25-inch touch screen, which supports voice recognition control of multimedia system, navigation, telephone, air conditioner and skylight. The steering wheel is made of leather, which provides a good grip and supports manual adjustment up and down and back and forth to meet the needs of different drivers. The seat is made of imitation leather. The main driver’s seat has the functions of front and rear adjustment, backrest adjustment and height adjustment, while the co-pilot’s seat also has front and rear adjustment and backrest adjustment. The rear seats can be laid down in proportion, which increases the storage space in the car. The car is also equipped with USB and Type-C interfaces, one in the front row and one in the back row, which is convenient for passengers to connect mobile devices. On the whole, Yisheng’s interior design is both practical and comfortable, bringing a pleasant experience to drivers and passengers.

宁波逸动正在优惠！最新报价6.99万，现车充足

This car is equipped with a 1.4T 160 HP L4 engine, with a maximum power of 118kW and a maximum torque of 260N·m, which is matched with a 7-speed wet dual-clutch gearbox, with excellent power performance and smooth shifting.

To sum up, the owner of car home spoke highly of the appearance and interior design of Yidong. He mentioned: "Yidong’s appearance is really fashionable, and I like the design of the net and the headlights very much, which makes me look very attractive. The body lines are also smooth and look very dynamic. The interior design is also great, looking young and full of technology. I think a car at this price can have such an interior design, which is really worthwhile. "

New Film Express ｜ Metamorphosis of Youth： Who can refuse a fluffy panda？

Text | Cat novelist

When Meimei chose to keep this panda in her body, I was a little relieved: I finally want to leave the blessings of my ancestors behind!

The film was not introduced to the mainland, and it was temporarily broadcast online abroad.

If the setting of this film doesn’t appeal to you, you must know another short film animation directed by the film: Bao Bao Bao, which won the Best Animated Short Film Award at the 91st Academy Awards.

For the record, this article covers a lot of spoilers. Please slide away if you care. Thank you.

The surprise of Metamorphosis of Youth is that you can always trust Pixar.

This is a story about Asian families. At the beginning of the film, the protagonist Meimei’s family in Toronto and her temple were explained.

Meimei is an obedient and excellent "other people’s child". At the beginning, it took a few minutes to introduce Meimei’s sacred work before she was 13 years old: she was alert, sensible, idealistic, listened to her mother and had a group of friends with her.

Suddenly, it was the same day as usual after school. Meimei’s friend asked her to take part in singing activities, but she said she wanted to "clean up". When I saw this, I thought she was going to help her mother clean up. In fact, she cleaned and incense the temple at home. The story begins, and their Li family’s past also begins. She has always regarded the "legend" told by her mother as "legend", and one morning after her mother found the boy in her notebook, she found herself suddenly turned into a red panda.

She was so scared that she didn’t dare to tell her mother that she was hiding in the bathroom alone, but her voice caught her mother’s attention. However, her mother mistakenly thought that Meimei was having her period, and quickly sent her a bunch of supplies. Meimei withdrew from her mother’s leisure time and went back to her room, slowly discovering that as long as she relaxed, she would become the original normal "Meimei". By the way, the picture of Meimei combing her hair with a comb is really cute! No one can refuse such a fluffy panda, right?

Meimei kept calm and went to school. She just didn’t want her mother to know that she had put on a hat to cover her red hair. But my mother was still worried about her and even ambushed her school and sent her sanitary napkins.

The beauty of this moment broke out completely, and she became the panda again, running in the street, trying to go home quickly.

At this point, everyone should understand that the story of Meimei has just officially begun, and the contradiction between her and her mother is also out of control from this moment.

Meimei gradually realized that this ability to become a panda is actually a family inheritance: in Meimei’s family, all women will become pandas uncontrollably during adolescence. The uncontrollable causes are often extreme emotions: anger, shame, longing … They face the problem of surrendering this little panda in their hearts together and try to seal it in the mirror.

The power of Metamorphosis of Youth is that it compares a child’s adolescence to a panda. Because in reality, the power of adolescence can’t be underestimated, and the family is a more sensitive topic in China. This Asian-directed film also says that Meimei is her in reality. Her adolescence is like drawing boys, but in fact, it’s not just Meimei. Children who have just reached adolescence have some strange ideas, are obsessed with the "dreaminess" brought by the band, and want to do anything that they are controlled and forbidden to do.

"The English name of the film, Turning Red, actually indicates the direction of" deformation "more clearly than the Chinese name" Metamorphosis of Youth "-red, which refers not only to red-brown pandas, but also to intense emotions, desires, rebellions, self-ambition, maturity, and even menarche and sexual fantasies. All these things together, it is adolescence, and especially refers to the puberty of women. Therefore, "red" is not a purely positive or negative word. On the contrary, it is a complex collection of things-many people think that turning red only symbolizes menarche and it is not accurate. Menstruation is just one of the elements that make it red. "

Red is in contrast to the color of Meimei’s mother. In her mother’s eyes, bringing Meimei up is not for her to be infatuated with 4 Town, nor for her to hide under the bed and paint. What she wants is always the beautiful girl who is sensible and obedient.

When my mother accused the boy in the convenience store of "seducing" her daughter without authorization, and eagerly criticized others without thinking that there was anything wrong with her daughter, it can be said that only my mother knew about the contradiction between the two people.

Meimei still stayed at home to do things, but when she stopped herself, she also released the real Meimei in adolescence.

Adolescence is a seemingly simple but dangerous period.

"The film has a very nuanced and vivid description of this’ danger’. In addition to portraying runaway and eager to move as a giant panda, there is even a vivid description of the taboo topic of’ children’s sex’ in the story: 13-year-old Meimei began to have a good impression on the opposite sex, including her idol, the 4 Town men’s group, and Dai Wen, a boy who works in a corner convenience store. If we only describe naive’ admiration’, it is just the usual routine of youth films. The two details in Metamorphosis of Youth further reveal the desire behind the love. "

Adolescence is infinitely beautiful, and it should be experienced between mother and daughter, whether for Meimei or Mom.

Meimei didn’t accept herself as a panda at first. She thought she was a’ monster’, with a strange smell of hair loss. She was also afraid that others would look at her differently. She thought it was abnormal. Therefore, this is also the reason why Meimei compromised with her mother several times, because she felt that everything would be solved as long as she compromised.

But what followed was the mother’s incomprehension and the’ persuasion’ of all ethnic groups. Even if the first practice failed, my mother would say, it doesn’t matter, we can start over, but at this moment Meimei realized that youth can’t be started over.

She jumps in the city, which is her heartfelt happiness, and she moves towards the light, which is the power of youth.

Back to the movie itself.

As soon as this film is on the line, the unavoidable topic is "discrimination".

In fact, not only Metamorphosis of Youth, but also the director’s first work Bao Bao Bao did not escape this remark, and The Lion Boy, which was released a few months ago, was used to say things because of "small eyes".

But the movie is really good. I’m not a fan of any director. I hardly knew her before watching the movie, so I just thought it was good.

Pixar’s films all have their own’ souls’, and there are really no technical problems in the picture texture and detail description, but Metamorphosis of Youth is about the adolescence that we have passed and that many children are about to meet. It’s a scourge, but it’s not bad luck. Meimei said that the panda stayed, and she also left this’ adolescence’ as happiness.

So at the end of the film, it’s a happy ending. They, Qi Xin, worked together to save the transformed mother and took a photo with 4 Town. On the night when the Red Crescent left, Meimei almost experienced many events that she didn’t dare to think about. It was also because of her panda that the Lee Ancestral Temple flourished, and her mother completely changed her previous stubborn ideas and stopped disciplining her daughter harshly.

After watching the movie, I feel comfortable because I know it must have a good ending, but what is warm is that you know that this movie is absurd and unrealistic, but at least it tells us women that you can choose any way to treat prejudice, or seal and hide it, or just ignore it, but we can even choose to believe that this kind of’ magic’ is real, and hug the red panda in your body without any worries.

At the end of the article, I want to say that any episode in life may be to test your perseverance in growth. The story of Metamorphosis of Youth is over, and our lives are still going on. I can’t help but wonder if Meimei will ask her daughter not to do anything when she grows up, and will she be afraid that she will go astray and do some behaviors that her daughter can’t understand.

It doesn’t matter. What matters is that we all have to go through puberty and find our own red panda.

In-depth analysis of Xiaomi model： efficiency wins, cost performance is king, and intelligent life ecosystem is built.

In-depth analysis of the new share Xiaomi model: efficiency wins, cost performance is king, and an intelligent life ecosystem is built. March 1, 2018, 12:15:40.

This article comes from WeChat WeChat official account’s "Guangfa Business Retail". The authors are Hong Tao, Ye Qun and Lin Weiqiang, the business retail group of Guangfa Securities Development Research Center. The original title is "In-depth Analysis of Xiaomi Model: Cost-effectiveness is king, efficiency wins, and the ecological circle of national intelligent life is built-the beginning of the research series of new retail model..

There are a lot of researches and debates on the "new retail" model in the market. We aim to explore the innovation of each model and its reference significance for industry reform through in-depth combing and thinking of typical companies. As the beginning of the series of reports, we first pay attention to Xiaomi. Compared with Ali and Tencent’s (00700) new retail layout of "empowerment" and "buy buy Buy" and online and offline retail companies "standing in line", Xiaomi’s "single-handedness" new retail is more like a "clean stream". we thinkThe rise of Xiaomi’s "cost-effective explosion", "Xiaomi House" and "Xiaomi ecological chain" reflects the rise of "manufacturing retail" and the huge excavation space of offline retail channel efficiency.

In the domestic PC Internet era, Baidu, Alibaba and Tencent are known as the "BAT" giants, which respectively control the three major Internet portals of search, e-commerce and social networking. After the rise of mobile Internet, the market always expects the rise of emerging Internet companies to challenge the Big Three. Especially in recent years, Baidu’s layout in the mobile Internet market is slightly backward, and its market value has been widened by Alibaba and Tencent. Who will succeed Baidu as the third Internet force outside AT has become the focus of discussion.

The growth experience of Xiaomi Company is legendary:Xiaomi, founded in 2010, started from scratch in just four years, and reached the top of the first smart phone brand in China in 2014, becoming the lucky one to take off with the mobile Internet. Long before the phrase "Are you ok" spread all over the Internet, with the outbreak of Xiaomi, Xiaomi founder Lei Jun’s theories of "Pig on the Wind", "Focus, Extreme, Word of Mouth, Fast" have been regarded as the standard of Internet thinking. After the low tide in 2016, Xiaomi miraculously broke out on the three fronts of mobile phone, ecological chain and Xiaomi House in 2017, and the king returned, becoming the only mobile phone brand that can be successfully reversed after the sales decline. Xiaomi has experienced great ups and downs in less than eight years since its establishment. Lei Jun, who is "my brother in the society, and there are not many people and goods", has once again become the godfather of Internet entrepreneurship.

Under the Xiaomi system, the cumulative number of users of MIUI system exceeded 300 million, the cumulative shipment of mobile phones was 260 million, and the monthly users were 130 million. Another 85 million IoT networking devices were awakened through Xiaomi AI speakers. Just as Apple encircles "fruit powder" with iPhone, Xiaomi has actually encircled "rice flour" with mobile phones and eco-chain intelligent hardware products. Xiaomi, who "refuses to run a score" and never forgets the cost performance, is actually an eco-company built by Apple in hardware in strategy, while practicing the cost performance boutique strategy represented by MUJI and Costco in tactics.

Study millet,It is not only the combing and learning of this ecological giant company, but also the insight and grasp of the consumption trend of the younger generation. And just as Apple has driven the industrial chain, Xiaomi, as an eco-giant company in the future, its growth is bound to benefit the upstream and downstream companies in the industrial chain.

Based on Xiaomi’s layout in the three major areas of IoT hardware, new retail channels and Internet-Internet of Things services, and the positioning of the national science and technology life ecosystem, the future development potential of Xiaomi’s ecological user scale and product boundary is great. Xiaomi is expected to become a force to be reckoned with in the new Internet retail market in China besides Alibaba and Tencent!

Understanding Xiaomi: Apple Strategy+Good Tactics, Hardware Building Ecosphere

In April 2010, Xiaomi was formally established. In just four years, Xiaomi started from scratch. In 2014, it surpassed Samsung to become the largest smartphone brand in China, and the investment valuation in the primary market has reached 45 billion US dollars. After the low tide in 2016, in 2017, Xiaomi once again became the absolute protagonist of the hot market discussion with the popularity of Xiaomi mobile phone, Xiaomi ecological chain and Xiaomi home.

Xiaomi currently has three major business segments: intelligent hardware, new retail and Internet/Internet of Things. To understand Xiaomi, we should look at the company from two dimensions of strategy and tactics: Xiaomi is an eco-internet company strategically. Similar to Apple, they are rare eco-companies with hardware-based infrastructure in the market. In addition to the core entrance of mobile phone, Xiaomi has occupied users’ cognition with the ecological chain product matrix, and strengthened the attraction of Xiaomi brand to "rice noodles"; Tactically, Xiaomi is more practicing the cost-effective boutique strategy of MUJI and Costco. The core tactic running through Xiaomi’s product line is to pursue the ultimate cost-effective explosion, and promote consumption upgrading from two directions: popularization of high-end products and quality of mass products.

(1) Breaking through the mobile phone, entering the IoT, Xiaomi ran wild for eight years.

In April 2010, Xiaomi was formally established after receiving $41 million in angel investment. In August and December of the same year, Xiaomi successively released MIUI operating system (one of the earliest Android customization optimization systems in China) and Michao (an instant messaging App released by WeChat), which accumulated great popularity among early smartphone enthusiasts. In August 2011, Xiaomi’s first-generation mobile phone MI1 was officially released, and Xiaomi officially entered the public’s field of vision. After the low tide in 2016, in 2017, with the popularity of mobile phones, eco-chain products and Xiaomi Home, Xiaomi became the only mobile phone brand that could be successfully reversed after the sales decline. Looking back on Xiaomi’s eight-year entrepreneurial history, it can be divided into three main stages:

1) The outbreak period of Xiaomi mobile phone (2011-2014). In the early days, Xiaomi fully enjoyed the popularity of smart phones in China and the bonus of online shopping channels, and built two series of mobile phones, namely "Fever" and "Entry", at a price of 1,999 yuan for Xiaomi /799 yuan for Redmi. With the combination of "high-quality and low-price" of big-name high-end flagship machine configuration and domestic cottage prices, Xiaomi quickly seized the younger generation to change phones and try new markets, and became the "first smart phone" for young people.

In 2014, the annual sales of Xiaomi reached 74.3 billion yuan, the annual mobile phone shipments reached 61.12 million units, and the domestic market share climbed to 12.5%, surpassing Samsung to become the largest mobile phone brand in China. In December of the same year, Xiaomi officially announced the completion of $1.1 billion financing and introduced well-known investment institutions such as Yunfeng Fund and DST, with a post-investment valuation of $45 billion.

2) Layout period of Xiaomi ecological chain (2014-2016). After the explosive growth, the lack of control over the supply chain has become a constraint to Xiaomi’s growth. In 2015, Xiaomi’s fifth-generation flagship mobile phone (Xiaomi 5), which was originally scheduled to be released at the beginning of the third quarter, was postponed to February 2016 due to supply chain problems, resulting in Xiaomi’s lack of heavy flagship new products for the whole year, and Xiaomi’s mobile phone suffered from Waterloo. However, the bottleneck period of the mobile phone market was made up by the ecological chain layout. In 2014, Xiaomi began to invest in the ecological chain model along the three major circles of mobile phones, intelligent hardware and daily consumables to build the Xiaomi ecological circle.

From 2014 to 2016, Xiaomi invested in 77 hardware start-ups in three years, of which 30 released products. By 2016, the sales of eco-chain hardware exceeded 10 billion. In the two years when Xiaomi’s mobile phone encountered a bottleneck, it effectively maintained the popularity of Xiaomi brand and seized the IoT (Internet of Things) outlet.

3) The second take-off period of Xiaomi’s new retail (since 2017). Xiaomi’s mobile phone regained its strength after making up the shortcomings of the supply chain in 2016. The success of the MIX series of high-end machines led the trend of comprehensive screen innovation in the industry, and the overseas market represented by India replicated the success of Xiaomi’s cost-effective strategy in the domestic market; Eco-chain enterprises that have continuously invested in the layout since 2014 have also entered the product outbreak period.

At the same time, offline Xiaomi Home has become one of the most successful offline new retail samples, and online "products" rank among the mainstream quality e-commerce. The two dimensions of product and channel broke out, which helped Xiaomi to take off for the second time: According to IDC data, in the first three quarters of 2017, Xiaomi’s mobile phone shipments reached 61.8 million units, up 71% year-on-year, and its shipments returned to the top five in the world; In October, Xiaomi completed the annual sales target of 100 billion yuan set at the beginning of the year ahead of schedule; In the whole year, the sales scale of eco-chain enterprises increased by 100% year-on-year to 20 billion, and about 235 to 287 new Xiaomi Home stores were opened.

(2) Hardware+New Retail+Internet Iron Triangle to build a "rice noodle" quality life circle

Xiaomi’s current business is mainly divided into three parts: intelligent hardware (terminal products), new retail (omni-channel sales) and Internet/Internet of Things (value-added services).

1) The hardware section is Xiaomi series intelligent terminal products.. Among them, Xiaomi itself mainly produces mobile phones, televisions, routers and AI speakers (core entrance & control products). In addition, through the eco-chain investment layout, we will fully export the methodology and values of Xiaomi products, provide all-round support in design, research and development, supply chain and channels, ensure the product style is unified, and comprehensively expand the boundaries of Xiaomi eco-products along the three dimensions of mobile phone periphery, intelligent hardware and daily consumables.

2) The new retail sector is the Xiaomi retail channel.In the early stage of its business, Xiaomi positioned itself as an Internet mobile phone brand, focusing on young people (with high Internet acceptance), and the product line under the explosion strategy was extremely limited (only 1-2 main phones were promoted each year), so it focused on online official website channels. In 2014, the sales of official website on Xiaomi Online reached 35.1 billion yuan, and the market share of e-commerce reached 3%, second only to Tmall & JD.COM among B2C e-commerce; Since 2015, with the rapid expansion of Xiaomi’s eco-chain product line, the combination of offline "Xiaomi Home" stores and online "quality" e-commerce has become a new layout of Xiaomi’s new retail channels, which is an important channel for Xiaomi’s eco-chain product experience promotion and user group expansion.

3) The Internet sector is the Xiaomi connection and value-added services sector.Around the current 300 million MIUI users, 130 million monthly users of mobile phones and 85 million users of IoT networking devices, Xiaomi Internet-Internet of Things service is first and foremost a bridge connecting Xiaomi’s intelligent terminals in series. At the same time, Xiaomi has laid out businesses such as e-commerce (goods), games (Xiaomi Entertainment), film and television (Xiaomi Film) and finance (Xiaomi Finance). With reference to the proportion of Apple service revenue in total revenue (FY17 accounts for 13.1% in total revenue and 34% in gross profit, and continues to increase), there is great room for improvement in Xiaomi’s value-added service revenue in the future, which is expected to become the most important realization channel of Xiaomi’s ecological system.

We believe that Xiaomi is similar to Apple in strategy, and it relies on smart hardware with mobile phone as the core as a fist drainage product to build a user ecosystem. But tactically, Xiaomi practices a high-cost boutique strategy similar to MUJI and Costco.

From a strategic point of view, Xiaomi, like Apple, is an eco-company with hardware as its infrastructure, and mobile phone is the core hardware entrance. The difference is that Apple is a leader in innovation, and its product positioning is high-end. The subversion of iPhone to the industry and the specificity of IOS system make it extremely attractive to users and brand premium, and the hardware itself has extremely strong profitability.

Product strategy focuses extremely on core items (excluding discontinued ipod players, and Apple’s core product lines are only iPhone, iPad tablets, Macs and iWatch watches), attracting "fruit powder" with absolute innovation of products; Xiaomi is more of a mass promoter of smart phones, and the MIUI system is also born out of the customization of Android system, so the migration of mobile phone users is much less difficult than that of Apple users. In addition to the four core imported items of self-produced mobile phones, televisions, routers and AI speakers, Xiaomi needs to occupy users’ cognition through a series of eco-chain products and strengthen the attractiveness of Xiaomi brand to "rice noodles".

From a tactical point of view, Xiaomi practices a cost-effective boutique strategy similar to Muji and Costco. The core tactic running through Xiaomi product line is to pursue the ultimate cost-effective explosion, reduce the difficulty and cost of supply chain with the strategy of selecting SKU, and let users create explosion, thus further realizing mass production and cost control; At the same time, the upstream supply chain is deeply controlled by the ecological chain incubation mode, so as to ensure the interconnection and unified style of different products, strengthen the brand awareness of Xiaomi, and promote consumption upgrading from two dimensions: the popularization of high-end products (such as smart phones, balance cars, sweepers, etc.) and the quality of mass products (such as wiring boards, suitcases, rice cookers, etc.).

From the perspective of profit model, it is estimated that the core profit sources of Xiaomi in the future mainly include three aspects:1) Select the aggregate demand of cost-effective SKU, so as to realize the combination of financial indicators of "low net interest rate, high turnover rate and high ROE" under the effect of economies of scale (similar to MUJI); 2) Service charges, that is, relying on value-added services such as games, advertisements and finance to bring service income (similar to Costco’s membership fee income and Apple’s value-added service income); 3) Tying high-margin peripheral small products (such as mobile phone shell films, etc.), as well as advertising and commission income of branded merchants with products.

Hardware Xiaomi: Cost-effective is king, Xiaomi IoT ecological entrance.

Intelligent hardware is the bottom entrance of Xiaomi’s ecology. To understand the innovation of Xiaomi model, we must first grasp Xiaomi’s product strategy. The core strategy of Xiaomi system products is to create cost-effective explosions and pursue the consumption upgrade of "high quality+reasonable price". Aggregate massive demand with high cost performance, and realize the rapid outbreak of single product scale; Further promote the efficiency improvement of supply chain and the control of procurement cost by scale effect, optimize the terminal price and stimulate the sustained release of demand.

Xiaomi mobile phone is the core hardware entrance of Xiaomi and the cornerstone of Xiaomi’s ecology. The success of Xiaomi mobile phone is not only an industry dividend that benefits from the transformation of functional machines into smart phones and the rise of e-commerce channels, but also benefits from the successful application of Xiaomi’s cost-effective explosion strategy and the accurate grasp of the upgrading direction of mass consumption in the era of consumption upgrading.

In 2014, when the mobile phone business was in full swing, Xiaomi began to lay out the Xiaomi ecological chain with IoT intelligent hardware as the general direction. For Xiaomi, the core value of the vigorous development of eco-chain enterprises lies in maintaining and strengthening Xiaomi brand awareness through continuous promotion, building Xiaomi lifestyle through product chain, and then building Xiaomi ecological circle. Xiaomi Eco-chain Company is neither a simple OEM/ODM foundry nor a loose alliance formed by joint-stock investment, but a vertical product company that exports all aspects of supply chain, capital, brand and channel support, replicates Xiaomi product logic from 1 to n, and rapidly extends Xiaomi brand product line.

(A) Xiaomi product strategy: the main cost-effective explosion, ecological chain empowerment to expand the border.

Xiaomi products practice strategies similar to Muji and Costco, so the pursuit of cost performance is the core strategy of Xiaomi products. The foothold of high cost performance is to improve the comprehensive quality of products such as product performance, design, face value and innovation rather than absolute low price, and to pursue the consumption upgrade of "high quality+reasonable price" in the mass consumer goods market.

Secondly, the product development starts from the principle of "meeting 80% demand of 80% users" and focuses on the functional demands of mainstream mass core products; Simplify the product line with explosive thinking, concentrate on resources such as design and research and development, reduce the difficulty of supply chain, and further improve the product cost performance by relying on the scale effect of single product.

Finally, the product line layout expansion adopts the ecological chain investment model. The front-end ensures that the tonality of product design is unified into a system and consolidates the brand awareness of Xiaomi; The back end empowers traditional manufacturing, giving full play to the enthusiasm of entrepreneurs and the advantages of China manufacturing.

1) Quality-oriented high cost performance is the core demand of mass consumption upgrading and the core strategy of Xiaomi products. Compared with the last round of consumption upgrading centered on the popularization of consumer goods (typical household appliances), this round of consumption upgrading is more a replacement upgrade under the accumulation of income and wealth of millennials:

① When the popularity of consumer goods is basically completed (new products and new categories are difficult to appear) and consumers have the ability and willingness to pay a premium, compared with simple price competition, products that meet the quality and personalized demands of the younger generation are more likely to stand out;

② The popularity of the Internet eliminates information asymmetry. Convenient supply and price comparison channels make it difficult to maintain the false high price under the traditional redundant channels. While the consumption capacity is improved, it also pays more attention to the cost performance of goods. Behind the popularity of cross-border e-commerce and fast fashion brands with low markup ratio is the cost performance logic of consumption upgrading;

(3) The increase of income level drives the increase of consumers’ price affordability: According to statistics, during the decade from 2006 to 2016, the average urban employment wage/household disposable income increased by 224%/186%, much higher than the overall CPI increase of 33% in the same period. The foothold of the corresponding consumers’ pursuit of cost performance will gradually shift from absolute low price to the pursuit of comprehensive quality of products such as performance, design, value, innovation and tonality at a reasonable price.

The business model of hardware building ecology and service realizing user resources determines that Xiaomi has been the benchmark of high cost performance in the industry since its birth, and after continuous innovation in product design, research and development, technology and other fields in recent years, the definition of high cost performance of Xiaomi products has gradually changed from "sufficient low price" to "value for money" at reasonable prices.

① The core hardware parameters of the first-generation Xiaomi MI1 mobile phone such as processor, screen resolution, RAM, camera, etc. are compared with international brands such as Samsung and HTC, but the price is less than half of that of rivals; According to Counterpoint data, in 3Q2017, the average stand-alone profit of Xiaomi mobile phone is only US$ 2, which is not only far below the level of Apple’s US$ 151, but also far below the level of domestic Android mobile phone manufacturers such as Huawei (US$ 15) and OPPO (US$ 14).

② Xiaomi’s mobile phone and eco-chain product ID design are leading peers. As of the first half of 2017, it has won 36 world top three design awards (German Red Dot, German IF and American IDEA); The MIX high-end flagship machine launched in September 2016 led the industry’s comprehensive screen innovation trend, and together with the MIX2 mobile phone launched in 2017, it was collected by Pompidou;

③ In February 2017, Xiaomi independently developed the mobile phone chip 澎湃 S1 and released it, becoming the second mainstream domestic mobile phone brand to release its own research chip after Huawei.

2) The 8080 principle defines product positioning, and the popularization of high-end products & the high quality of mass products promote consumption upgrading.Accurate product positioning includes many dimensions such as target users, function setting, quality control, product pricing, etc. Among them, the core problem lies in user group positioning and satisfaction of core functions (that is, solving "pain points"). Xiaomi’s product development follows the principle of "meeting 80% needs of 80% users" and is committed to the development and optimization of core functions, so as to focus on limited resources and solve the core pain points of users.

In the early years, Xiaomi’s mobile phone "refused to accept running a point" is an intuitive expression of the performance of the mobile phone, and the focus behind it is the common stuck problem of Android mobile phones in the early years; Mi band focuses on the three core functions of pedometer, alarm clock and sleep monitoring, and realizes 30-day long battery life by canceling the screen (adding the screen after the second generation technology upgrade), thus solving the embarrassment that peer products generally need frequent charging.

Under the principle of Xiaomi 8080 product development, the product line focuses on functional products with high standardization and versatility, and at the same time, it prevents the development cost from being too high due to the generalization of product functions, and the price of end products is greatly reduced in exchange for the improvement of efficiency, creating explosions, and further reducing the production cost of products by scale effect, realizing a virtuous circle of production and sales. The price of Xiaomi M1 mobile phone in 1999 and the price of Xiaomi 1st generation bracelet in 79 yuan were absolute "price butchers" with similar core functions in the industry at that time, which laid the foundation for the sales of phenomenal products.

From the perspective of consumption upgrading, the significance of Xiaomi 8080 principle lies in promoting mass consumption upgrading from two dimensions: popularization of high-end products and quality of mass products: the former focuses on lowering the price threshold for users to try (reducing non-core functions & mass production), while the latter focuses on improving product quality (solving and optimizing pain demand). Looking at Xiaomi’s eco-chain product line, products such as mobile phones (early days), smart TVs, bracelets, sweepers and balance cars can be classified as high-end products, while wiring boards, charging treasures, IH rice cookers and mobile phones (now) can be classified as mass products.

3) Ecological chain empowers to expand product boundaries and build a "rice noodle" lifestyle.Xiaomi focuses on functional products, but the product line expansion far exceeds that of ordinary companies. According to product types, it is mainly divided into four categories: ① Smartphone is the lowest core hardware and the starting point of the whole ecological chain; ② Expand mobile phone peripheral products such as mobile power supply, headphones and protective covers around different consumption scenarios of mobile phones; ③ Focus on home intelligent hardware products such as AI audio and video, smart TV, air purifier, balance car, smart desk lamp, etc. according to the IoT layout idea; ④ In addition to intelligent hardware products, develop functional consumables such as towels, bags, pens and mattresses. From intelligent hardware to daily consumables, create a "rice noodle" lifestyle in all directions.

From the perspective of product line layout expansion, Xiaomi adopts the eco-chain investment incubation mode to ensure that the single product development team focuses on four eco-chain entrances and control products: mobile phones, televisions, WIFI routers and AI speakers, and the rest of the eco-chain products set up joint ventures with leading enterprises in the industry (for example, 90-minute luggage cooperates with Kairun, a listed company, and iHealth smart sphygmomanometer cooperates with Jiu ‘an Medical, a medical device listed company), or invest in entrepreneurial teams with deep product and industry resources (for example) The founder of Huami Technology, the parent company of mi band, is the earliest technical expert who used Linux in embedded system in China.

Xiaomi exports a full set of resources such as brand, channel, supply chain and capital, and leads the product ID design, and the front-end ensures that the tonality of product design is unified into a system to consolidate Xiaomi brand awareness; The back end empowers traditional manufacturing, gives full play to the professionalism of entrepreneurs and the advantages of China manufacturing, replicates the successful model of Xiaomi mobile phone, and forms a pan-group and ecological growth model.

(2) Xiaomi mobile phone: the industry dividend is superimposed on the cost-effective revolution to create the ecological cornerstone of Xiaomi.

Just as QQ/ WeChat is the gateway to Tencent and Taobao is the gateway to Ali, mobile phones are the hardware cornerstone of the whole ecosystem (iPhone is the cornerstone of Apple’s ecology), because mobile phones have become the core infrastructure of the mobile Internet economy and the source of traffic connecting users and Internet services: According to CNNIC data, as of 1H2017, the number of domestic mobile phone users reached 724 million, accounting for 96.3% of the total netizens; The national average weekly online time is 26.5 hours. 1H17 The market scale based on mobile Internet (including mobile marketing, games and shopping) increased by 48.7% year-on-year to 584 billion yuan.

Xiaomi’s success first stems from the success of Xiaomi’s mobile phone. The explosive growth of Xiaomi mobile phone, on the one hand, benefited from the transformation of functional machines into smart phones and the rise of e-commerce channels, on the other hand, benefited from the successful application of Xiaomi’s cost-effective explosion strategy and the accurate grasp of the direction of mass consumption upgrading in the era of consumption upgrading.

The rapid replacement of traditional function machines by smart phones is an industry dividend for the rise of Xiaomi mobile phones. The commercial roll-out of 3G(2009) and 4G(2014) networks has greatly accelerated the mobile Internet. The launch of Apple iPhone(2007) and Google’s joint HTC& Samsung (2008) to develop Android smartphones has subverted consumers’ understanding of mobile phones in the traditional functional machine era. After the domestic mobile network accelerated greatly in 2010 (3G was officially rolled out), the wave of smart phones came quickly. According to the data of the Ministry of Industry and Information Technology, in 2011, domestic smartphone shipments reached 95 million units, accounting for 23% of mobile phone shipments in that year; By 2016, smartphone shipments reached a high of 522 million units, accounting for 93.2% of the total mobile phone shipments.

The outbreak of online shopping is the channel dividend for the success of Xiaomi mobile phone. The core distribution channels of mobile phones in the era of functional machines are operators and offline public channels. After 2010, domestic e-commerce began to rise rapidly: at that time, Taobao was deeply rooted in the hearts of young people. In that year, the sales of Double Eleven reached 940 million yuan, which witnessed the powerful explosive power of online shopping for the first time (the sales of the first Double Eleven in 2009 were only 50 million yuan); Two representative platforms, Dangdang and JD.COM, have successively listed/obtained huge financing (Dangdang landed on the NYSE in 2010 and raised $270 million; JD.COM received $1.5 billion in financing in 2011). Driven by the explosive power and capital of online shopping, major platforms started large-scale subsidy expansion, and online shopping entered an explosive growth period.

In addition to the two major bonuses of smart phones and online shopping, the success of Xiaomi’s mobile phone first cut into the two core pain points of high initial price of smart phones and stuck Android system, smoothing out the premium of international big brands and high brands, and filling in the quality worries of domestic shanzhai machines.

In the initial stage, smart phones were limited by supply chain efficiency and high R&D investment. Under the single-machine profitable sales strategy, branded mobile phones were priced in the high-end market. According to IDC statistics, in 2010, the average selling price of Apple’s iPhone series phones was $710, and the average selling price of Android phones reached $441 (3,000+RMB). Although the price of domestic knockoffs is low, there are frequent quality risks. Xiaomi’s pricing of 1999 yuan (Xiaomi series) and 799 yuan (Redmi series) greatly fills the lack of mass consumer-grade mobile phone brands, which is a typical representative of the popularization of high-end products and the quality of miscellaneous brands in the mobile phone market.

In 2016, domestic brands represented by Xiaomi have lowered the average selling price of Android phones to $215; At the same time, the number of models listed in the domestic mobile phone market dropped from 4,745 in 2011 to 1,054 in 2017; The market share of the top five mobile phone brands increased from 56.1% in 2012 to 76% in 3Q17, and the market share of Xiaomi mobile phone increased to 13.7% in the same period (Xiaomi mobile phone did not enter the top five in 2012).

In addition to the price, the initial Android mobile phone was limited in hardware configuration and insufficient in software optimization (the native Android system is similar to a "rough room" and needs fine decoration), and the problem of operation jam was widely criticized. On the one hand, Xiaomi insists on "high price and low allocation" in the hardware layer of mobile phone, and makes up for the inherent deficiency of mobile phone software with hardware performance; On the other hand, before Xiaomi officially released the mobile phone products, the MIUI system based on Android optimization had been iterated at a high speed for one year, accumulating hundreds of thousands of users (breaking a million in January of 12), which was one of the most popular third-party UIs for mobile phone enthusiasts at that time. The dual efforts of software and hardware made Xiaomi mobile phone almost the "best to use" mobile phone at that time, and the famous slogan "I don’t want to run a point" was an intuitive expression of the performance and smooth use of Xiaomi mobile phone.

Specific to the style of play, the success of Xiaomi mobile phone is the best practitioner of the cost-effective explosion product strategy:

1) Product line restraint.Xiaomi followed Apple’s example in the early years and maintained a flagship product strategy every year. In 2013, Xiaomi introduced the low-end product line Redmi series, introduced the business big-screen Note series in 2015, and opened the high-end MIX flagship series in 2016. Up to now, classified by price segment, Xiaomi mobile phone mainly includes four product lines: MIX flagship focuses on high-end (more than 3000 yuan), MI series &Note series (big screen) focuses on mid-end (2000-3000 yuan), and Redmi series focuses on entry market (1000 yuan).

2) "Sufficient materials" for core components.The supply chain of core components of Xiaomi mobile phone adopts the same quality suppliers from Apple and Samsung to ensure the basic quality control of products and the stability of the supply chain. At the same time, Xiaomi is also in the leading group in China in R&D investment. In February, 2017, Xiaomi officially released its first mobile phone chip, Songguo S1, and put it on the market in its new Redmi 5C machine. Xiaomi became the second mainstream mobile phone manufacturer in China to release self-developed chips after Huawei. In November 2017, MediaTek COO Zhu Shangzu joined Xiaomi as a partner in the industrial investment department, and Xiaomi’s independent mobile phone chip research and development investment went up a storey still higher.

3) ID design of "face value is justice".With the rapid iterative development of smart phone industry, there is little difference in performance between brands, especially among flagship phones, so ID design has increasingly become an important factor to distinguish brands from flagship machine. Xiaomi officially launched the MIX full-screen mobile phone in September 2016, which immediately led the full-screen trend of mainstream mobile phone manufacturers in 2017. In December 2017, after being collected by the National Design Museum of Finland, the small MIX series mobile phones were collected by the Pompidou Center of France (listed as the three major museums in Paris together with the Louvre and the Art Museum of Ossetia), and were hailed as "the perfect integration of technology and art, which is an outstanding masterpiece leading the design and technology in the intelligent age".

In March, 2014, Xiaomi mobile phone entered Singapore, and started the internationalization and expansion of Zhang Zhilu. Since then, with the Indian market as the core, Xiaomi mobile phone has effectively replicated its cost-effective explosion strategy in China in major developing countries, and overseas markets have blossomed in an all-round way:

According to India’s Economic Times India report, FY2017 (as of the end of March) Xiaomi’s revenue in India reached 83.79 billion rupees (about 8.44 billion RMB), a year-on-year increase of over 700% and achieved profitability. According to IDC data, the market share of 3Q2017 Xiaomi mobile phone in India climbed to 23.5%, which tied with Samsung as the largest mobile phone brand in India. In addition, Xiaomi has gained a firm foothold in Southeast Asian markets such as Indonesia and Vietnam, Eastern European markets such as the Czech Republic and Ukraine, and Middle East markets such as Israel and the United Arab Emirates. The market share of Xiaomi’s mobile phones in 14 overseas countries and regions has entered the top five.

(C) Xiaomi ecological chain: layout IoT, bamboo forest ecology copied from 1 to N.

In 2014, when the mobile phone business was in full swing, Xiaomi began to invest in incubating Xiaomi eco-chain enterprises with mobile phone peripherals and intelligent hardware products as the core. According to the data of Tianyancha, in 2014, Xiaomi’s foreign investment increased to 40 (only 4/8 in 2012/2013). By the end of 2017, Xiaomi’s accumulated foreign investment reached 185, focusing on the early financing of Angel Wheel (53) and A Wheel (56) in the fields of intelligent hardware (46), culture and entertainment (32) and game services (21), and comprehensively arranging IoT.

According to the official disclosure, by the end of 2016, there were 77 Xiaomi eco-chain enterprises, of which 30 released products, 16 companies had an annual income of over 100 million, and 3 companies had an annual income of over 1 billion, including Huami Technology (mi band & Watch), Zimi Technology (Xiaomi Mobile Power Supply), Wanmo Acoustics (Xiaomi Headphones), Power Future (Xiaomi Wiring Board) and Runmi Technology (90 Suitcases).

For Xiaomi, the core value of the vigorous development of eco-chain enterprises lies in maintaining and strengthening Xiaomi brand awareness through continuous promotion, building Xiaomi lifestyle through product chain, and then building Xiaomi ecological circle.

1) The success of the mobile phone market has established a basic user disk for Xiaomi’s ecosystem. However, compared with the high user stickiness built by Apple’s mobile phone with absolute product strength and IOS system specificity, Xiaomi’s mobile phone needs to face the competition from many manufacturers in the Android camp. Under the background that the competitiveness of a single product cannot be absolutely ahead, it needs to rely on eco-chain products to strengthen the user’s stickiness to the ecosystem;

2) The mobile phone is a durable consumer product, and under the rhythm of the main product of "one flagship every year", it is difficult for Xiaomi to maintain a sustained brand popularity by relying solely on mobile phones, and the exposure and release of products of eco-chain enterprises has greatly broadened the Xiaomi user base while maintaining the brand popularity (according to the Xiaomi Eco-chain Battlefield Notes, as of 2016, only about one third of Xiaomi eco-chain product users are Xiaomi mobile phone users, and the rest are Apple).

3) In addition to the core entrance of mobile phones, the IoT boom represented by smart homes is in the ascendant. The deep cultivation of Xiaomi eco-chain enterprises in the field of intelligent hardware is undoubtedly the ticket for Xiaomi’s leading peers to the IoT era.

In 2017, the revenue of Xiaomi Eco-chain enterprises exceeded 20 billion yuan, doubling year-on-year, and has already formed a new product growth point outside the mobile phone. Taking the data of Xiaomi Tmall flagship store in November 2017 as an example, the total sales volume of Xiaomi mobile phones in stores has dropped to 23.5% (the sales amount accounts for 43%).

On the day of the Double Eleven, Xiaomi TV (32/43/49/55-inch same-foot segment Tmall sold first), Xiaomi notebook (Tmall notebook sold first), Xiaomi air purifier (Tmall/JD.COM/Suning three platforms first), mi band (Tmall/JD.COM/Suning three platforms bracelet category first), No.9 balance car (No.

In terms of capital market operation, many Xiaomi eco-chain companies have/intend to land in the capital market. By the end of 2017, Runmi (parent company Kairun shares) and Qingmi (parent company power future) have landed on A shares and New Third Board respectively; Chuangmi (parent company Longqi Technology) and Huami Technology plan to IPO in A shares and US stocks respectively; Wanmo Acoustics acquired a total of 15.27% equity of the listed company in cash of 995 million yuan and became its controlling shareholder.

Xiaomi Eco-chain Company is neither a simple OEM/ODM foundry company nor a loose alliance formed by equity investment, but a vertical product company that exports all aspects of supply chain, capital, brand and channel support, replicates Xiaomi product logic from 1 to n, and rapidly extends Xiaomi brand product line. Specifically, Xiaomi mainly provides seven major supports for eco-chain companies:

1) Brand support. Xiaomi opens two brands of "Mijia" and "Xiaomi" to the products of eco-chain companies that meet the requirements. The former is mainly aimed at smart home, consumer hardware, and products oriented to "art in life"; The latter is mainly aimed at technology and geek products.

2) Supply chain support. Xiaomi gives full play to its accumulated credibility and bargaining power in the electronic industry chain, and provides endorsements for eco-chain companies.

3) Channel support. Open omni-channel sales support such as Xiaomi.com on PC side, Xiaomi Mall on mobile side, Mijia Youpin and Xiaomi House offline, and provide crowdfunding channels for new product research and development.

4) Investment and financing support. Xiaomi & Shunwei Fund leads the investment (usually holding 10-30% of the shares), and at the same time, according to the development stage, Xiaomi invites first-line investment institutions to participate in the financing roadshow of eco-chain companies in batches.

5) product definition. Xiaomi and Eco-chain Company have deep cooperation in product definition, and all products on Xiaomi platform need to be jointly decided by both teams;

6)ID design. Xiaomi guides eco-chain enterprises in design, and reserves one vote of veto in the ID department of eco-chain companies to ensure that the design styles of "Mijia" and "Xiaomi" brand products come down in one continuous line and their values are unified.

7) Quality requirements. Xiaomi’s output quality management requirements require that all eco-chain products must pass Xiaomi’s internal testing and screening when landing on all platforms of Xiaomi.

In terms of product pricing and sales, "Xiaomi" and "Mijia" brand products must abide by the exclusive cooperation agreement between the two parties (self-priced sales of self-owned brand products of eco-chain enterprises): 1) Xiaomi and Mijia (including other channels operated or licensed by Xiaomi, such as Xiaomi Tmall flagship store and offline Xiaomi specialty store) are the only exclusive sales channels of eco-chain products; 2) Xiaomi purchases the products in full at the product manufacturing cost price (including raw materials, packaging and transportation, depreciation of labor and special equipment, etc.); 3) Xiaomi and Eco-chain Company divide the product sales profit (generally 50:50); 4) Product terminal pricing is jointly decided by Xiaomi and eco-chain enterprises.

Taking Huami Technology (mi band manufacturer) as an example, we illustrate the operating mode of Xiaomi Eco-chain enterprise.

Huami Technology was established in January 2014. The founder is Huang Wang, a continuous entrepreneur of technical intelligent hardware who graduated from China University of Science and Technology (once worked for Huawei, and was the first technical expert to use Linux in embedded systems in China). The main products are mi band (the core item) and Xiaomi weighing scale, and smart wearable products are produced and sold under his own brand Amazfit. According to the disclosure in the prospectus, Xiaomi holds 19.3% equity of Huami Technology through its fund People Better limited, and Xiaomi’s related party Shunwei Capital holds another 20.4% equity.

The core product of Huami Technology is mi band, and its operation completely follows the product operation idea of Xiaomi Migao’s cost-effective explosion: 1) In terms of functional design, mi band focuses on the three core functions of step counting, alarm clock and sleep monitoring, and removes secondary functions such as call, touch and music playback; 2) Cancel the screen (added after the second-generation product technology upgrade) to reduce power consumption, achieve 30-day long battery life, and solve the pain point of frequent charging of peer products; 3) Pricing in 79 yuan (the second generation product is priced at 149 yuan), which is much lower than that of peers with a price of more than 1,000 yuan, greatly reducing the cost of early adopters. At the same time, colorful wristbands are provided for young users to change colors.

Financial data confirms the success of Huamei’s product strategy of high price explosion. Under the strategy of high cost-effective explosive products, we rely on the large-scale production and sales of single products to improve operational efficiency and achieve large-scale profitability with "low net interest rate+high turnover rate". The first three quarters of 2017:

1) The shipment of Huami bracelet reached 11.6 million, surpassing Fitbit to become the world’s largest smart wearable brand; Operating income increased by 37.4% year-on-year to 1.296 billion yuan (the proportion of revenue from Xiaomi decreased from 92.1% in 2016 to 82.4%); The net profit was 95 million yuan, a year-on-year loss; In the same period, Fitbit revenue decreased by 34.5% year-on-year to $1.04 billion, with a net loss of $230 million.

2) The overall gross profit margin of Huami reached 25.3%, which was significantly higher than that of 17.7% in 2016, mainly due to the increase in the average sales unit price of products (the proportion of second-generation and private brand products in mi band increased) from 87.4 yuan to 111.7 yuan, and the scale effect of the supply chain was highlighted after the sales of single products increased significantly, but compared with Fitbit’s gross profit margin of 42.3% in the same period, the characteristics of Huami bracelet with high cost performance were still obvious.

3) The advantages of cost and turnover are the core of Huami’s profit. The R&D expense ratio of Huami is 8.4% (equivalent to the level of Fitbit in 2015), and the sales expense ratio/management fee rate is only 2.3%/6.4%(VS Fitbit is 25.6%/9.5% in the same period); At the same time, the turnover days of Huami inventory is only 39.9 days (annualized), which is much better than Fitbit’s performance of 61.3 days, thus achieving a net interest rate of 7.3% and a ROA (annualized) of 12.3% with a gross profit margin of 25.3%, and the large-scale profitability began to stand out.

New Retail Xiaomi: Omni-channel Strategy for Winning Efficiency

New retail is Xiaomi’s channel strategy, which seeks to improve the efficiency of product circulation. Xiaomi was born in the Internet, and fully enjoyed the channel bonus of online low traffic cost in the early stage of growth. In addition, the number of SKUs under the explosion strategy is extremely limited. From brand image building to sales channels, focusing on the younger generation, the Internet is undoubtedly a more efficient choice. After 2016, the traffic dividend faded and the brand competition intensified, and the Internet channel became more and more crowded. The expansion of the eco-chain product line, on the one hand, makes the brand positioning of Xiaomi gradually expand from "Internet geek with high cost performance" to "national science and technology life" brand; On the other hand, smart new products continue to be launched, and the demand for offline physical experience is getting stronger and stronger, and the comprehensive cost-effective advantage of physical channels reappears.

No matter what the presentation form is, the new retail is the reconstruction of the three retail elements of people, goods and markets, and the essence behind it is the omni-channel integration and data operation promoted by technology, thus achieving a significant improvement in operating efficiency. The promotion of Xiaomi’s eco-cost-effective product strategy not only needs to focus on the core pain points in the production process with the "8080 principle" to create explosions, but also needs to optimize the circulation and promotion links to achieve efficient operation of the whole product link. From the focus line to the omni-channel layout, Xiaomi consistently pursues the ultimate efficiency.

(A) from the Internet, reputation is king of national science and technology brand of life.

Xiaomi was born and rose on the Internet, and fully enjoyed the online traffic dividend. It is also one of the few models that successfully landed and turned into an omni-channel national brand. From the perspective of brand building, the Internet thinking of "focus, extreme, word of mouth and fast" put forward by Lei Jun in his early years is the brand building and communication idea that Xiaomi’s word of mouth is king: focus and extreme are product goals; Fast, is the code of conduct; Word of mouth is the core of Internet thinking.

In the shaping of good word-of-mouth, good products are the engine, which is the first in establishing word-of-mouth, and all brand marketing is the second. Social media is the accelerator of word-of-mouth communication, which promotes the viral spread of brand image on the Internet. Equal user relationship is the relationship chain of word-of-mouth communication, making friends with users, allowing users to participate in product discussion, design and demand collection, and becoming the "tap water" of products.

Li Wanqiang, vice president of Xiaomi, described the process of brand building of Xiaomi in detail in "Sense of Participation", which can be summed up as three strategies: "making explosive products, being fans and being self-media" and three tactics: "opening up participating nodes, designing interactive ways and spreading word-of-mouth events".

In terms of strategy, 1) "making explosive products" is a product strategy, that is, we should focus on the product scale stage, achieve the first market segmentation, and gather resources to form scale effect; 2) "Being a fan" is a user strategy, that is, to seek the transformation from weak user relationship (purchase) to strong user relationship with stronger trust ("tap water") and become a fan of products and even brands; 3) "Being self-media" is a content strategy, that is, making the enterprise itself an information node of the Internet, encouraging employees and users to become product spokespersons, and guiding users to participate in interaction and share diffusion.

Tactically, 1) "open participation nodes" means opening all links of products, services, sales and brand promotion, looking for nodes that benefit both parties, so that users can deeply participate in them; 2) "Design interaction mode" means following the design idea of "simple, beneficial, interesting and real" to facilitate users to participate in interaction; 3) "Spreading word-of-mouth events" means screening a group of "fans" with high product recognition in advance, fermenting the sense of participation on a small scale, making the content generated based on interaction into topics and events that can spread, and making word-of-mouth fission and spread.

The "orange Friday" development model of Xiaomi’s early MIUI system is not only a typical example of the "three three" rule. With 100 core official engineers, MIUI has established a development team covering 100,000 forum users to realize a new experience of refreshing every Friday. 1) Open participation nodes: except for the engineer’s code writing part, product requirements, testing and release are open to users to participate, Xiaomi iterates the system according to users’ opinions, and users get the functions and products they want; 2) Design the interactive mode: based on the forum discussion and feedback, collect the requirements, and regularly release the system update package every Friday; 3) Spreading word-of-mouth events: In addition to MIUI’s encouraging sharing mechanism, Xiaomi also filmed the micro-film "Sponsor of 100 Dreams" for the first 100 users who participated in the measurement, amplifying the "sense of participation".

In 2014, the sales scale of Xiaomi official website reached 35.14 billion yuan, and the market share of e-commerce reached 3% in that year. The scale of B2C e-commerce was second only to Tmall and JD.COM, ranking the third largest e-commerce platform in China; In 2017, the sales scale of Xiaomi Tmall flagship store reached 2.46 billion yuan in a single day, occupying the Tmall Double Eleven brand store king for many years in a row and being the first Internet brand.

After 2015, the online traffic dividend tends to decline, and after years of popularization of smart phones, the incremental demand has shifted from the first and second lines to the third and fourth lines and even the township-level market, while the e-commerce that Xiaomi relies on to grow has not yet dominated the low-line market, and the short board missing offline has begun to stand out. In September, 2015, the first Xiaomi House under Xiaomi Line opened in Beijing Contemporary Mall (previously, "Xiaomi House" was only positioned as an after-sales service and maintenance outlet), and Xiaomi began to enter offline retail.

In response, in July 2016, Xiaomi changed its tradition and invited three popular stars, Wu Xiubo, Liu Shishi and Haoran Liu, to endorse the red rice mobile phone, highlighting the positioning of Redmi’s "national mobile phone"; In October of the same year, Xiaomi launched the Note2 mobile phone with a big business screen, and invited Tony Leung Chiu Wai to speak for it. After entering 2017, with the omni-channel transformation and the positioning of national mobile phones, Xiaomi further invited Wu Yifan and SNH48 to speak for their mobile phones, fully enabled traffic stars of all ages, and sponsored popular variety shows such as "Qi Pa Shuo", "Hip-hop in China" and "Our Travel". In addition, the eco-chain product line and Xiaomi House stores were quickly rolled out, and Xiaomi was fully launched by the Internet.

According to GFK data, in July 2017, the offline sales of Xiaomi mobile phones accounted for 41%; Aurora big data shows that in 3Q2017, among Xiaomi mobile phone users, young users aged 16-25 accounted for only 29.6%, main users aged 26-35 accounted for 57.2%, and users over 36 accounted for 13%; At the same time, female users accounted for 35.8%. In addition, among the users of Xiaomi’s ecological chain, Xiaomi’s mobile phone users only account for about 1/3, and Xiaomi has completely changed from positioning young people’s Internet mobile phone brands to national technology life brands.

(2) E-commerce Xiaomi: quality e-commerce, a new generation of e-commerce platform.

In April, 2016, Netease launched the e-commerce platform Netease YEATION. The front end relied on the entrance diversion of Netease departments, such as Netease Mailbox and Youdao Cloud, and the back end skipped the traditional distribution link and directly docked with big brands’ foundries. The platform endorsed the product quality and focused on the high quality and cost performance of "good life, not so expensive", which was a great success. According to publicly disclosed data, as of September 2016, Netease YEATION released a total of 30 million registered users for half a year, with a monthly flow of 60 million yuan; Ding Lei, CEO of Netease, set a "small goal" for Netease YEATION to reach 7 billion yuan/20 billion yuan in 17/18 in the earnings conference call at the beginning of 17 years.

Since 2017, quality e-commerce platforms (or brands) have been launched one after another, including Xiaomi’s products (born out of Xiaomi’s smart home control platform "Mijia App"), Ali’s Taobao Heart Selection, Suning’s polar products, JD.COM’s Beijing-made products, etc., and become an absolute hot spot in the market. Although the specific operation modes are different, we believe that the main focus of quality e-commerce is mass consumption upgrade, the core keyword is quality-oriented high cost performance, and the realization method is platform folding supply chain docking upstream factories, and relying on platform credit endorsement quality.

The basic meaning of selling is to meet consumers’ consumption demand, and the changes of core consumption demands of main consumer groups in different social development environments will promote the evolution of corresponding dividend formats. The particularity of the domestic market lies in the huge difference in regional development level, which makes different formats parallel at the same time dimension. Judging from the overseas mature markets and domestic development experience, offline retail has basically gone through the process of free market, hypermarket-department store (such as Wal-Mart), outlet (strictly speaking, outlet is a variety of department store), and gradually evolved into selected stores (such as Costco Costco Costco and Muji).

The logic of market operation has correspondingly undergone a transformation from product-oriented (material scarcity) to channel-oriented (information asymmetry), and then to user-oriented (meeting the diversified needs of users such as cost performance and experience). During this period, the control of channels on the supply chain has been continuously improved, and channels have been deeply involved in the supply chain to improve efficiency and meet the increasingly critical product needs of users.

Different from the traditional e-commerce form, we believe that quality e-commerce is essentially the evolution of online e-commerce format, and its direction corresponds to the trend of offline dividend format change: the migration of C2C Taobao to B2C Tmall & JD.COM is the evolution of e-commerce low-price drive to brand & service drive; The rise of quality e-commerce is a process of e-commerce quality-selection and cost-effective drive migration based on one-stop shopping of B2C integrated e-commerce.

At present, it is the initial stage of the outbreak and growth of the quality e-commerce platform, which has yet to be expanded from the niche to the mass. According to Aurora Big Data, in October 2017, the number of monthly users of quality e-commerce was about 5.73 million (only counting the number of users of Netease YEATION, Mijia Youpin and Necessary three independent apps), which increased by 170% year-on-year, accounting for only 0.58% of the total mobile Internet users, about one-tenth of the 580 million monthly users of mobile phone Taobao (12M17); From the perspective of user distribution, the proportion of quality e-commerce users in first-and second-tier cities reached 63.6%, which was much higher than the proportion of users in first-and second-tier cities as a whole among netizens in the same period of 37.6%.

Xiaomi’s Mijia Youpin e-commerce platform was originally an e-commerce module under Xiaomi’s smart home control platform "Mijia" App. In April 2017, Mijia Youpin (now renamed "Youpin") independent App was officially launched, and the Xiaomi system quality e-commerce platform went to the front desk. Product e-commerce focuses on Xiaomi and Mijia eco-chain products, and absorbs high-quality third-party brands to settle in, forming a quality e-commerce platform with intelligent hardware and technology products as the mainstay and full category coverage. Compared with Netease YEATION, Mijia has the following advantages:

1) Anterior drainage. Mijia Youpin started with "rice flour", with online traffic resources of Xiaomi intelligent software and hardware, and store experience promotion resources with Xiaomi House as the core (opening a hotel in YEATION in conjunction with Atour is also an expansion of offline experience resources, but the short-term quantity is extremely limited);

2) Back-end supply chain integration. There are products that focus on Xiaomi and eco-chain enterprise intelligent hardware products, which are unparalleled in the supply chain resources of scientific and technological hardware products in China. And after accumulating sticky user resources with high-priced hardware, select third-party brand merchants to expand low-priced products such as daily shopping, home furnishing, catering, etc. to achieve full category coverage, and the expansion difficulty is relatively small (as an analogy, JD.COM also started with low-frequency consumption, and started with 3C with high customer list, which was originally less difficult than Dangdang with low customer list books);

3)IoT "remote control e-commerce" function. Xiaomi IoT ecosystem is leading in China, and its potential application has great imagination. As far as e-commerce sales are concerned, the precise push and one-click purchase that Mijia intelligent platform can achieve by monitoring the accumulated big data in real time is far from being comparable to the general platform. Related recommendation (for example, Xiaomi humidifier monitors the poor water quality of users and pushes water purifier products; Xiaomi rice cooker recommends brand rice according to users’ preferences), consumables purchase (for example, air purifier & automatic recommended purchase when the filter element of water purifier runs out), and overall collocation (the design style of Xiaomi ecological products is unified, and all of them can be controlled by Mijia App), etc. The potential "remote control e-commerce" system of Xiaomi Ecology has great development potential.

(C) the new retail millet: channel integration, efficiency jump.

In September 2015, Xiaomi’s first offline direct sales store "Xiaomi Home" opened in Beijing Contemporary Shopping Mall, and Xiaomi officially entered the offline retail market. After exploring the experiment in 2016, Xiaomi put forward the goal of 1,000 stores in three years at the beginning of 2017, and began to rush to accelerate the expansion. In the whole year, 235 stores were opened to 287 stores, which became one of the most eye-catching offline new retail formats in 2017.

We believe that after the 8090 generation rose to be the main consumer group, the change of consumption habits brought about the reconstruction of the three retail elements of people, goods and markets, promoted the omni-channel integration and digital operation, improved the user experience, and brought about a significant improvement in operational efficiency.

1) The change of "people" is the core factor to promote industry change. The generation of 8090 has grown into a new main consumer group, thus giving birth to industry changes, and new brands, new ideas, new services, new marketing and new formats that meet their needs have gradually emerged; At the same time, it also puts forward new requirements for retail employees, from the past simple commodity sales to service users;

2) The change of "field" means the transformation and innovation of retail format to meet the needs of users for consumption anytime and anywhere and omni-channel integrated operation (such as unified inventory management with electronic price tag as standard in stores; Hanging system store picking support online operation); At the same time, it is also necessary to combine omni-channel data accumulation to guide site selection, dynamic line design and combination of formats and categories to promote the digitalization of offline user behavior;

3) the change of "goods" lies in returning to the essence of retail efficiency, guiding the selection of goods by data, improving the efficiency of supply chain, and screening quality and branded goods in line with the trend of consumption upgrading; And achieve omni-channel inventory access, providing unified inventory management for front-end formats.

Xiaomi’s new retail core pursuit is omni-channel coverage of users, which promotes the significant improvement of store operation efficiency;

1) The offline channel is mainly direct-operated Xiaomi Home, and at the same time, two types of franchisees are opened, namely, Xiaomi Specialty Store (franchisee site selection and construction, Xiaomi operation) and Xiaomi Home Authorized Store (franchisee site selection and construction, Xiaomi provides guidance), and settled in Suning and other offline mainstream electrical chain stores;

2) Online channels are dominated by e-commerce platforms with products (including the entrance of Mijia platform) and Xiaomi Mall, and at the same time, they are stationed in mainstream e-commerce platforms such as Tmall, JD.COM and Suning.cn;

3) All categories are covered online and offline, but offline stores select traffic explosions and new products, emphasizing experience and efficiency; Online, the whole line of products is covered, emphasizing one-stop satisfaction.

According to official public data, the typical store area of Xiaomi Home is about 200-500 square meters (Shenzhen flagship store opened in November 2017 is about 650 square meters), and the floor efficiency of the store reaches about 270,000 yuan/square meter/year, which is much higher than the level of ordinary offline chain stores of 10-50,000 yuan/square meter/year, and is second only to Apple’s official experience store in the world (about 400,000 yuan/square meter/year). Apple and Xiaomi are both star product companies involved in the retail sector ("manufacturing retail companies"), and the economic effect of brand fans built by the strong competitiveness of their products is the basis for their success. However, comparing the two phenomenal retail stores of Apple and Xiaomi, there are some differences in their operations:

1) Store positioning and expansion strategy.Apple retail stores are located as product experience, image promotion and after-sales service centers, with a large store area (1,000-3,000 square meters). They are located in core business districts and large shopping centers, and the number of stores and SKUs of store products are limited. As of 2017, there are about 500 official retail stores in the world, of which only 41 have opened stores in China for ten years (the first store was Sanlitun store opened in 2008).

Store products are mainly Apple core products such as mobile phones, computers and watches, and related peripheral products such as headphones and keyboards; Xiaomi Home is also positioned to promote product experience, but its sales attributes are stronger (the store does not support after-sales service), and its store area is smaller (200-500 square meters, Shenzhen flagship store is 650 square meters). Compared with fast fashion brands, the site selection focuses on shopping centers in the core-community business district, with intensive stores (295 stores have been opened on New Year’s Day in the past 18 years; Only 15 stores have been opened in Beijing), and the number of SKUs in the stores is about 200-300, covering the full range of hot-selling explosions and new products of Xiaomi and Eco-chain Company.

2) product pricing and profit strategy.Apple attracts "fruit powder" with absolute product innovation, leading the industry, high brand premium, high-end pricing of all series products, and strong profitability of hardware itself (the proportion of software service revenue is increasing, but the proportion is still limited, FY2017 is 13.7%). FY2017, the gross profit margin of overall hardware sales of Apple products is 29%, and the average single-machine profit of mobile phones reaches 151 US dollars (3Q17); Xiaomi products are based on high cost performance, pursuing to build an ecosystem with intelligent hardware, and then realizing user value with services. The pricing of the whole series of products is close to the people, and the profitability of hardware items is limited. The unit price profit of core mobile phone products is only 2 dollars (3Q17), and the gross profit margin of store products is only 8-10%.

Lei Jun, the founder of Xiaomi, disclosed Xiaomi’s new retail core play in an exclusive interview in October 2017, that is, according to the formula of retail = flow x conversion rate x customer unit price x repurchase rate, retail (flat efficiency) was disassembled into four steps and eight strategies, and each step was done to the extreme:

1) flow.Traffic is passenger flow, and the promotion depends on the location of stores and the combination of goods. The location of Xiaomi House is mainly located in shopping centers in the core or community business districts of first-and second-tier cities, and fast fashion and leisure brands such as Uniqlo, Starbucks and MUJI, which are close to the target customers, set up stores on the benchmark and drain each other. At the same time, we pay attention to the collocation of consumption scenes in the store product sampling. The products cover 200-300 SKUs in 20-30 categories, and are updated in time (even on the leading line) to ensure the "shopping" of the store.

2) conversion rate.The core of improving the conversion rate of passenger flow to store consumption is that the products are attractive enough. On the one hand, Xiaomi’s own brand gene emphasizes the ultimate explosion, which is known for its cost performance, and the product itself has enough consumer appeal. On the other hand, the selection of SKUs in stores is based on the accumulation of online sales data, and 200-300 SKUs in stores are based on the secondary selection of 20,000 SKUs of quality e-commerce, which promotes the transformation of high consumption of store passengers.

3) Customer unit price.The increase of customer unit price is not to raise the price of single product, but to achieve it by increasing consumption. The appearance design value of Xiaomi ecosystem products is unified, and the technical functions are interrelated (which can be controlled by Mijia App or Xiaomi AI speaker network), and the proportion of joint sales and even overall arbitrage is high. In addition, offline stores naturally have the advantage of experience, coupled with offline synchronization of new products online, and experience the charm of Xiaomi products in kind.

4) Repurchase rate.The improvement of repeat purchase rate is not only the result of strengthening brand awareness, but also the need to provide convenient purchase channels. Xiaomi products consistently adhere to the concept of high cost performance, and the online content and offline store three-dimensional communication with word of mouth are king, shaping Xiaomi Migao’s cost-effective national science and technology life brand awareness. Through the omni-channel layout, users can consume at any time and place, and at the same time, the online registration experience of consumer guide users in the store is used, and the offline selected explosions are used to drain the full range of Xiaomi ecological products with richer online experience for users.

In December 2017, we conducted a grassroots survey of Xiaomi Home Shanghai Joy City Store and Shanghai Wujiaochang Store, and measured the operation of Xiaomi Home based on the survey data of first-hand stores. Among them, Joy City Store covers an area of about 500 square meters (including warehouse and office) and its business area is about 400 square meters. It is located on the third floor of Joy City in Jing ‘an, Shanghai. The store opened in May 2016. It is the first store of Xiaomi House in Shanghai and one of the six benchmark stores with annual sales exceeding 100 million. Wujiaochang Store opened in November, 2017, with an area of about 250 square meters (including warehouse) and a business area of about 200 square meters. It is located in B1 Building, wanda plaza, Wujiaochang, adjacent to Wujiaochang University District. We conducted a half-hour grass-roots investigation on the store in the afternoon on weekdays, and recorded the operation of the store from the dimensions of passenger flow, transaction, goods and clerk.

1) passenger flow.Neither of the two stores is located in a prime location on the first floor, but the passenger flow is far superior to the surrounding stores, and the passenger flow composition obviously breaks through the typical user impression of Xiaomi’s "young men aged 18-30". During our observation for half an hour: ① Joy City Store has accumulated 61 customers, and the number of customers staying in the store is maintained at around 50; The ratio of male to female customers entering the store is close to 2:1(39:22), mainly young people, but also including 5 elderly people and 8 foreign customers; ② Wujiaochang Store has accumulated 58 people into the store, and the number of customers staying in the store is maintained at more than 30; The ratio of male to female is also close to 2:1(38:20), including two elderly people and three foreign customers.

2) Deal.The turnover rate (more than 10%) of passenger flow in Xiaomi’s lower store is much higher than that of online website, and the joint sales of Xiaomi ecosystem products effectively drive the increase of customer unit price. Also in the half hour we observed: ① Joy City Store has accumulated 17 transactions, and the transaction conversion rate reached 28% (based on the number of customers entering the store); The customer’s unit price is about 302 yuan. In addition to the mobile phone, the products sold include charging treasure & headphones and other mobile phone peripherals, intelligent hardware such as sweeping robot & desk lamp, and daily necessities such as backpacks & suitcases. ② Wujiaochang Store has accumulated 9 transactions, the transaction conversion rate is 16% (based on the number of customers entering the store), and the customer unit price is about 469 yuan. Considering that Wujiaochang Store has only been opened for 2 months, the subsequent stores are mature and have location advantages (close to the university area), and there is a lot of room for improvement in store passenger flow and transaction.

3) commodity SKU.The SKU of Xiaomi Home Store is mainly based on Xiaomi and Mijia brand eco-chain products, and also includes a few eco-chain self-owned and third-party brand products, covering most products of Xiaomi technology lifestyle, but it is more selected than online. According to our on-site inventory: ① There are about 250 SKUs from Joy City stores, including 48 mobile phones (including the same model) and 8 TVs; ② Wujiaochang Store has about 180 SKUs, including 32 mobile phones and 8 TVs. New products such as Xiaomi MIX2 mobile phone, Xiaomi Kongjing 2S, AI audio and video are all synchronized, and the product prices and promotions are synchronized with online (for example, the store synchronized online to buy Xiaomi MIX2 mobile phone to send AI speakers).

4) shop assistant.Xiaomi Home Store does not undertake the after-sales service function of Xiaomi (there are also official and authorized service outlets), and there are many shop assistants, but their main work is product function introduction and shelf tally, and they rarely take the initiative to promote it. According to our on-site inventory: ① There are 17 on-site clerks in Joy City Store, including 2 cashier, 15 in-store service and tally, and several people in the warehouse who work in two shifts, with more than 40 employees in the whole store; ② There are 11 shop assistants in Wujiaochang Store, including 1 cashier, 10 in-store service staff and about 30 employees.

According to the field grassroots research, we calculate the annualized single store model of Xiaomi House, and the main assumptions include:

1) The business hours of the store are 12 hours from 10: 00 am to 10: 00 pm, in which the peak passenger flow at 18:30-20:30 pm is about 3 times as usual, and the passenger flow at weekends and holidays is 3 times as much as that on weekdays;

2) Taking mi band as an example, according to Huami’s prospectus, the gross profit margin of mi band’s sales in 2016 was 17.5% (Xiaomi and Huami shared the profits 50-50), and the gross profit margin increased to 24.8% after the scale of 1-3Q17. Considering that mi band is a mature star product, and its gross profit margin is higher than the overall level, combined with grassroots research, it is estimated that the average gross profit margin of store products is about 8-10%, taking 9%;

3) According to DTZ data, in 2017, the rent of the first-floor high-quality retail property in Shanghai was about 40 yuan/day/square meter, and the average listing rent of shopping centers and department stores in SouFun Shanghai was 15 yuan/day/square meter. Considering that Xiaomi House is mostly located in the underground or high-rise of shopping malls and the brand effect of Xiaomi, it is conservative to take the store rent as 25 yuan/day/square meter;

4) According to Zhaopin’s recruitment data, the average salary of waiters in Shanghai in 2017 was 4,050 yuan/month, and the recruitment salary of Xiaomi Home Store Manager was 140,000-210,000 yuan (Beijing). Considering the staff structure of Xiaomi Home Store and combining with grassroots research, the average salary of employees was conservatively taken as 6,000 yuan/person/month.

Based on the above grassroots survey data and main assumptions, we estimate:

① The mature store of Xiaomi Home (Joy City Store) has an annual passenger flow of 960,000 person-times, annual sales of 104 million yuan and annual floor efficiency of about 259,000 yuan (in terms of operating area); Gross profit is about 9.3 million yuan, after deducting 4.5 million yuan of rent, 3.2 million yuan of labor costs and 1 million other expenses (water and electricity, cargo damage, etc.), the annual operating profit is about 600,000 yuan.

② The annual passenger flow of Xiaomi Home New Store (Wujiaochang Store) is about 930,000, the annual sales is about 57.3 million yuan, the annual floor efficiency is about 286,000 yuan, and the gross profit is 5.2 million yuan. After deducting 2.3 million yuan of rent, 2.2 million yuan of labor and 500,000 other expenses, the annual operating profit is about 200,000 yuan. Considering the increase in passenger flow and conversion rate after the store matures, there is still much room for improvement in store sales and profitability.

③ According to the data disclosed by Xiaomi Home in official website, in 2017, Xiaomi Home opened 235 to 287 new stores, covering 29 provinces and 170 cities. In the whole year, the cumulative number of customers entering the store reached 67.13 million, including 4.59 million buyers. The annual sales of six stores exceeded 100 million, and the average floor efficiency of a single store reached 270,000/m2/year. Our grassroots research and calculation basically confirmed the official disclosure data of Xiaomi, and Xiaomi House is indeed a sample of new retail stores under the phenomenal level!

Internet Xiaomi: hardware architecture platform, service realization and profit

As mentioned above, we think that from a strategic point of view, Xiaomi is an eco-company with hardware-based infrastructure similar to Apple, in which mobile phone is the core hardware entrance, and it occupies users’ cognition by means of product matrix, strengthening the attraction of Xiaomi brand to "rice noodles"; From a tactical point of view, Xiaomi practices a cost-effective boutique strategy similar to MUJI and Costco, focusing on consumption upgrading from the two dimensions of high-end product popularization and mass product quality, and achieving a national science and technology life brand with word of mouth as the king. The omni-channel layout of online quality e-commerce and offline Xiaomi Home will optimize the product circulation and promotion links, realize the efficient operation of the whole link of products, and create a new retail format with phenomenal level and efficiency.

In Xiaomi’s "Iron Triangle" business layout, the success and rapid expansion of "Hardware Xiaomi" and "New Retail Xiaomi" have verified the feasibility of Xiaomi’s ecological strategy with hardware, while "Internet Xiaomi" is not only the connector of Xiaomi’s ecosystem, but also the core profit source for realizing users of Xiaomi’s services in the future. At the present time, we believe that the channels for realizing Xiaomi’s services mainly include: e-commerce (income from self-operated and third-party brands), finance (Xiaomi Jinfu), entertainment (Xiaomi Mutual Entertainment & Film Industry) and cloud computing (Jinshan Cloud).

1) e-commerce.The e-commerce platform with products as the core is not only Xiaomi’s own channel layout, but also the direct channel for Xiaomi to realize ecological user resources. Just like the platform road of self-operated B2C e-commerce, represented by JD.COM, the eco-chain product "rice flour" with the gathering of quality e-commerce is a young generation with strong e-commerce consumption habits and spending power. The presence of third-party brand merchants not only enriches the category structure of quality e-commerce, but also directly brings paid brand sellers to Xiaomi.

At present, Xiaomi’s e-commerce platform is still dominated by its own brand products. With reference to the development history of JD.COM, the revenue from services such as advertising and payment is expected to increase rapidly after the merchants of third-party platforms increase their volume (in 2016, the proportion of GMV of Beijing’s third-party platforms reached 43.4%, and the contribution of gross profit accounted for 56.9%).

Different from general e-commerce, Mijia smart home control platform has built a comprehensive platform of "hardware-technology platform-e-commerce platform-consultation platform-user sharing": the technology platform built by intelligent hardware connection is embedded with e-commerce and information functions, and users can control the hardware with Mijia App, and at the same time, they can purchase related products and share their feelings and suggestions (UGC content) with one click; The accumulation of user purchase and hardware usage data is further reversed, which makes the platform make accurate portraits and product recommendations for users (not only the preferences of related products, but also the accurate reminder and one-click purchase of consumable products), which is the next generation of "remote control e-commerce" that is closer to users and better understands users.

2) Entertainment.Entertainment is the layout of Xiaomi’s ecological content. At present, it mainly includes two platforms: Xiaomi Mutual Entertainment and Xiaomi Film. Xiaomi’s mutual entertainment is mainly based on the layout of entertainment channels, focusing on the layout of three major areas: games (such as Xishanju, Palm Fun, Fun Fun and Mutual Entertainment, etc.), information (a little information, more reading, etc.) and entertainment (Youku Tudou, Iqiyi, etc.); In addition to investing in Huace Film, Xinshengtang and other film and television content companies, Xiaomi Film also participated in the film announcement by itself. In April 2017, the first film invested by Xiaomi Film was released in Shock Wave 2, with a cumulative box office of over 400 million RMB (according to the statistics of China Box Office Network).

Game distribution is the most direct way to realize the Xiaomi entertainment sector. According to Xiaomi’s official disclosure, as of 9M2017, the cumulative download volume of Xiaomi’s official app store application reached 106 billion times; In 2016, the download volume of Xiaomi channel games reached 2.24 billion times, a year-on-year increase of 58.9%; The share of Xiaomi game developers reached 2.2 billion yuan, a year-on-year increase of 100%.

3) finance.Xiaomi already owns financial business licenses such as banking (co-sponsoring the establishment of Sichuan New Network Bank, holding 29.5% of the shares), third-party payment (acquiring 65% of Jiefu Ruitong’s shares), Internet securities (leading Tiger Securities’ A round of financing), small loan & wealth management (Xiaomi Finance), insurance (Xiaomi Insurance) and crowdfunding (Shanghai Michoujinfu), and related businesses have started to increase in volume in 2017.

According to the data of China E-banking Network, as of the beginning of November 2017, the accumulated lending scale of Xiaomi’s consumer loans has exceeded 30 billion yuan, with a loan balance of about 10 billion yuan, serving more than 1 million customers. In May 2017, Xiaomi’s loan of 3 billion rack ABS was approved on the Shanghai Stock Exchange (it can be registered and issued many times within the quota), becoming the third Internet finance company to be approved for rack ABS after Ali and JD.COM.

4) Cloud computing.Cloud computing is an Internet infrastructure. Besides meeting its own business needs, the service output of redundant computing power has become the consensus of various Internet giants. In December 2012, Xiaomi began to lead Jinshan Cloud. In December 2017, Jinshan Cloud completed 520 million US dollars of financing, and its post-investment valuation reached 2.12 billion US dollars, making it the largest single financing in the domestic shared cloud field. According to IDC data, in 1H2017, Xiaomi Jinshan Cloud reached 6.5% in the domestic public cloud market, making it the third largest domestic public cloud service provider after Alibaba Cloud and Tencent Cloud.

According to official website of Jinshan Cloud, Jinshan Cloud has 19 large data centers, more than 80,000 servers, 600 global CDN nodes and 20T CDN broadband. Service customers include Xiaomi Mutual Entertainment, WPS, Thunder, Today Headline, Mango TV, Aauto Quicker and other leading companies in the field of Internet segmentation inside and outside Xiaomi system.

Investment suggestion: the rise of manufacturing retail, pay attention to Xiaomi eco-related companies.

We believe that,Xiaomi is an Internet eco-giant company with the same latitude as Alibaba, Tencent, Apple and Amazon, all of which have fist drainage products and diversified service realization channels.Among them, Xiaomi is the closest to Apple in terms of strategy, and both are ecosystems with intelligent hardware as the core architecture. In addition to the core entrance of mobile phone, the IoT intelligent hardware system with Xiaomi ecological chain mode layout is unparalleled in China, occupying the "rice noodle" mind with product matrix.

At the same time, tactically, it focuses on cost-effective quality consumption upgrade. Compared with Apple, Xiaomi is an intelligent ecosystem with more complete product layout and more affordable prices. At the same time, the omni-channel new retail layout of Xiaomi’s efficient operation has already built a Xiaomi Home store with off-line phenomenal efficiency and a high-quality e-commerce platform with great online potential. In the future, it is expected to rely on the Mijia platform to build a next-generation "remote control e-commerce" that is closer to users and better understands users.

Based on the services such as e-commerce, finance, entertainment and cloud computing built by the "rice flour" ecology, Xiaomi now has a quick way to realize profits. It should be pointed out that Xiaomi’s layout in the three major areas of IoT hardware, new retail channels and Internet-Internet of Things services and the positioning of the national-level scientific and technological life ecosystem have great potential for the future development of the number of ecological users and product boundaries, and the corresponding profitability and volume will also require us to re-examine.

From an investment perspective, in addition to Xiaomi’s own growth potential, we suggest looking for investment opportunities from two dimensions:

1) The success of Xiaomi’s new retail model, on the one hand, verifies the huge space for improving the efficiency of traditional offline retail channels, injects Internet genes, integrates omni-channel and digital operations, and promotes the reconstruction of people, goods and fields. The offline channel reform is expected to bring surprises; On the other hand, in addition to front-end drainage and business innovation, Xiaomi Migao’s product strategy of cost-effective explosion also reflects the demand for consumption upgrading with the quality of a new generation of consumers as the core. The "manufacturing retail" company that controls the back-end supply chain resources will be the main theme of the times, and it is suggested to focus on the reference significance of this trend in the new retail reform of the industry.

2) Just like Apple Industrial Chain Company driven by Apple and Ali Industrial Chain related companies driven by Alibaba, Xiaomi, as an eco-giant company in the future, its growth is bound to benefit the upstream and downstream companies in the industrial chain. Starting from this main line, it is suggested to focus on the impact of Xiaomi model on retail industry ecology and listed companies in Xiaomi ecological chain.

Risk warning

1. The decline of Xiaomi’s mobile phone business: competition in the smart phone industry has accumulated, and Xiaomi’s domestic market is facing competition from international brands represented by Apple and Samsung and domestic brands represented by Huawei, oppo and vivo. The mobile phone business has the risk of decline due to intensified competition and insufficient innovation;

2. Risk of Xiaomi’s eco-chain product line expansion: Xiaomi’s eco-chain enterprises are not directly controlled by Xiaomi, and the product quality control ability of related companies and the expansion of new products will greatly affect the expansion of Xiaomi’s own product line. In addition, with the expansion of eco-chain company’s own brand products, there is a lower-than-expected risk in the expansion of Xiaomi’s eco-chain product line;

3. Intensified competition in new retail: New retail is a hot spot in the market, and Internet companies represented by Alibaba, Tencent and JD.COM have all started to lay out offline business. Coupled with the competition of traditional offline retail companies, the expansion of Xiaomi’s new retail stores is not up to expectations;

4. The liquidity of Xiaomi eco-users is lower than expected: the overall consumption power of Xiaomi eco-users is weaker than that of Apple. User brand loyalty, willingness to pay, etc. still need time to verify, and there is a lower-than-expected risk in realizing user value. (Editor: Hu Min)

Important principles to be grasped in building a modern industrial system

　　Modern industrial system is the material and technical foundation of modern countries. Report to the 20th CPC National Congress of the Communist Party of China put forward the important task of building a modern industrial system. The first meeting of the 20th Central Committee of Finance and Economics emphasized the "five persistences" in accelerating the construction of a modern industrial system, namely, persisting in focusing on the real economy, striving for progress steadily and step by step, persisting in the three-time industrial integration and development, persisting in promoting the transformation and upgrading of traditional industries, and persisting in open cooperation. This is an action guide for building a modern industrial system with integrity, advancement and safety in the future.

　　To build a modern industrial system, we must first accurately grasp the era connotation of this concept. On the whole, the modern industrial system should have at least three main characteristics. One is integrity. Integrity not only refers to the complete industrial categories, but also refers to the complete production capacity of high-end products within the industry. In addition, integrity also refers to adapting to the characteristics of China’s huge population, and the labor-intensive industries are fully developed and can provide sufficient jobs. The second is the advanced nature. Advanced nature not only refers to the high level of production technology and management, but also refers to the strong industrial competitiveness, which can support industrial upgrading under the current situation of two-way extrusion of developed and developing countries in China. In addition, it can also provide high-level factor returns and effectively promote common prosperity. The third is security. Safety means not only being able to achieve a high level of self-reliance without highlighting shortcomings and weak links, but also that key resources such as grain, energy and minerals can meet development needs, and that the industrial system should be environmentally friendly and take the road of sustainable development. Generally speaking, the three characteristics of "integrity, advancement and safety" fully reveal the important connotation and development requirements of modern industrial system.

　　According to the era connotation of modern industrial system and the current situation of industrial development in China, we need to grasp five important principles to accelerate the construction of modern industrial system supported by real economy.

　　First, insist on focusing on the real economy and prevent it from being divorced from reality. It is the key to build a modern industrial system to optimize the allocation of production factors and allocate high-quality production factors to the most critical industries. The nature of capital is to flow to the place where the highest return can be obtained, and its sensitive sense of smell can always compare the average profit rate of different industries. This natural profit-seeking, that is, "from the real to the virtual" or "from the virtual to the real" flow valve. It is the real economy that really creates wealth for the society, creates more jobs and opens up the track of scientific and technological innovation. The real economy is the foundation of the country and is of great significance to maintaining long-term economic prosperity and social stability. China started from the real economy, and it also depends on the real economy to move towards the future. At any time, we can’t "break away from reality". The most fundamental thing is to make the real economy grow stronger and make the manufacturing industry, especially the advanced manufacturing industry, profitable and promising.

　　To prevent the reality from becoming illusory, we must first effectively improve the benefits of the real economy and enhance its attractiveness to factors such as funds and talents. Manufacturing industry is the main industry participating in international competition and the core of the real economy. In order to comprehensively improve the efficiency level of manufacturing industry, we should not only attach importance to the "addition" policy, support and guide enterprises to strengthen innovation, develop with specialization and novelty, and enhance the differentiation of products and services, but also combine the "subtraction" measures, especially to guide low-quality and inefficient enterprises to withdraw from the market in time, shape a reasonable competitive market structure, and supplement it with the policy of expanding demand to improve pertinence and directness. Secondly, while strengthening "reality", we must also make up "emptiness". In the financial field, it is necessary to improve the diversified and efficient financial service system and guide finance to better play its role in serving the real economy. It is necessary to further deepen systematic, institutional and rule-of-law reforms, gradually and steadily solve the obstacles that affect the stability and healthy development of the capital market, so that abundant social funds can be more effectively invested in the real economy and provide more solid industrial support for high-quality development.

　　Second, we should persist in striving for progress steadily and step by step, and we should not be greedy for foreign countries. Building an advanced modern industrial system does not mean that all localities should develop high-tech industries at the same time. Emerging industries, high-tech industries and major projects are growing rapidly and have good development prospects, which have a great pulling effect on the local economy, and often become the focus of attention in various places. However, it is also easy for all places to rush headlong into the herd and compete excessively, and a few places succeed, while most places invest a lot but fail to achieve benefits. Although some places or cities have succeeded in developing high-tech industries by leaps and bounds, they do not have simple replication, and blindly launching projects without considering the actual situation may produce fallacy of composition. To implement the requirements of striving for progress steadily and step by step, the core is to give full play to the different roles of the market and the government in industrial development. Local governments need to formulate industrial development plans to clarify and guide the upgrading and development of local industries, but the focus should be on constantly improving market supervision, strengthening services to enterprises, strengthening planning guidance and shaping a better business environment. Enterprises are the main body of investment decision-making and self-financing. The government can’t take the place of independent decision-making by enterprises, and it can’t attract projects with so-called preferential subsidies for "assessing performance".

　　The third is to adhere to the integration and development of three industries and avoid separation and opposition. There is an inherent balance among the three industries, so we can’t unilaterally emphasize the development of any one industry. China is a unified big market, where goods and services circulate efficiently and help each other, and the industrial development of each region should mainly follow the principles of comparative advantage and efficiency priority. From various places, we should neither unilaterally pursue the proportion of tertiary industry and simply implement "retreat from two to three", nor unilaterally emphasize the proportion of manufacturing industry and inhibit the development of service industry. At present, we should pay more attention to the new trend of the integration and development of various industries. With the rapid development of the new generation of information technology and digital technology, its empowerment effect on various industries is more significant, and the traditional boundaries between many industries are also blurred. For example, in many typical manufacturing enterprises, the value-added from R&D, design, brand image, after-sales and other service links has greatly exceeded the manufacturing link. The deep integration of modern service industry with advanced manufacturing industry and modern agriculture has become an important direction of industrial upgrading. In guiding industrial development, all localities should fully consider the inherent requirements of the integrated development of local pillar industries, upstream and downstream industries and related industries, and reserve sufficient space and resources for the development of related industries.

　　Fourth, we should persist in promoting the transformation and upgrading of traditional industries and should not simply quit as "low-end industries". Traditional industries are the base of modern industrial system, and the transformation and upgrading of traditional industries are directly related to the overall construction of modern industrial system. In the process of building a modern industrial system, China must always attach importance to the development of traditional industries. This is the requirement of maintaining and enhancing China’s industrial competitiveness. At present, China’s traditional low-cost advantages are weakening, and the establishment of competitive advantages such as technology and brand is not achieved overnight. The complete industrial system and strong supporting capacity are important sources of China’s industrial international competitiveness for a long time. The simple withdrawal of traditional industries will directly damage China’s industrial integrity, reduce its supporting capacity and ultimately weaken China’s international competitiveness. At the same time, the new round of scientific and technological revolution and industrial transformation has also brought new opportunities to improve the efficiency and international competitiveness of traditional industries. Many traditional industries can become advanced manufacturing industries after transformation and can have a longer development period. To promote the transformation and upgrading of traditional industries, we should continue to increase support for the digital intelligence and green transformation of traditional manufacturing industries, and solve the problems of low profit margin and weak self-upgrading ability of traditional industries; In the process of promoting industrial transformation and upgrading, local governments should attach great importance to the development of traditional industries with cluster effect, provide support and guarantee for the development of these traditional industries, and prevent simplification from retreating.

　　The fifth is to adhere to open cooperation and not build a car behind closed doors. Persisting in opening to the outside world is an important experience of China’s rapid economic development in the past. Through "bringing in" and "going out", China not only introduced important capital and technology, but also participated in competition and learning in the global market, which promoted the product quality and competitiveness. Continuous open cooperation is an inherent meaning of building a modern industrial system and an inevitable requirement for achieving high-quality development. It should be clearly seen that the key core technologies can’t wait or not, and the key links of the industrial chain and supply chain must be mastered by China itself, but we can’t take the old road of closed development. Only by adhering to a high level of opening to the outside world and always keeping the domestic market fully open to domestic and foreign enterprises can we deeply participate in the global industrial division and cooperation, maximize the absorption of foreign advanced achievements, accelerate the pace of innovation, give full play to China’s super-large-scale market advantages and strive for a better external environment, and also better expand the potential of external demand, promote industrial upgrading and better build a modern industrial system.

　　(Author Xu Zhaoyuan is the deputy director and researcher of the Industrial Economics Research Department of the State Council Development Research Center. Source: Economic Daily)

Foshan Roewe RX5 price reduction carnival at the end of the year! Discount 25,000, limited time special offer.

[car home Foshan Preferential Promotion Channel] is currently carrying out preferential promotion activities in Foshan, with a maximum preferential margin of 25,000 yuan, and the minimum starting price has been reduced to 74,900 yuan. If you are interested in this model, you may wish to click the "Check Car Price" button in the quotation form to get a higher discount.

佛山地区荣威RX5年末降价狂欢！优惠2.5万，限时特惠

The exterior design of Roewe RX5 is mainly fashionable and dynamic, and the overall lines are smooth and powerful. The front face adopts a family-style design language, including a large-size air intake grille. The chrome decoration inside the grille makes it more exquisite, and at the same time, it blends with the sharp headlights on both sides, showing a strong visual impact. The side lines of the car body are simple and full of tension, and with the suspended roof design and dynamic waistline, the whole car looks younger. The overall style is both atmospheric and energetic, which meets the aesthetic needs of modern consumers for SUV models.

佛山地区荣威RX5年末降价狂欢！优惠2.5万，限时特惠

Roewe RX5 has a body size of 4655*1890*1664mm, a wheelbase of 2765mm, a front tread of 1590mm and a rear tread of 1584 mm.. The lines on the side of the car are smooth and dynamic, showing a strong sporty atmosphere. Tyre size is unified as 215/60 R18, and the equipped rim is simple and powerful, which improves the overall visual effect and driving stability.

佛山地区荣威RX5年末降价狂欢！优惠2.5万，限时特惠

The interior design of Roewe RX5 is simple and fashionable, and high-quality materials are used to create a warm and comfortable driving space for passengers. The leather steering wheel feels delicate, supports manual adjustment up and down, and is flexible and convenient to operate. The 12.3-inch central control screen integrates the functions of multimedia system, navigation, telephone, air conditioning and skylight control, and supports voice recognition control system, providing convenient operation experience for drivers. A USB interface is arranged under the center console, which is convenient for front and rear passengers to charge. The leather seat is comfortable and breathable. The main seat supports front-back adjustment, backrest adjustment and height adjustment (2-way). The auxiliary seat has the functions of front-back and backrest adjustment. The rear seat can also be laid down in proportion to expand storage space. The overall interior style pays attention to practicality and comfort to meet the diverse needs of vehicles.

佛山地区荣威RX5年末降价狂欢！优惠2.5万，限时特惠

Roewe RX5 is equipped with a 1.5T turbocharged engine with a maximum power of 138kW and a maximum torque of 300N·m, with excellent power performance. Matching it is a 7-speed wet dual-clutch gearbox, which can provide a smooth and fast shift experience.

We once again feel the charm of Roewe RX5. He is satisfied with the styling and dynamic performance of the Roewe RX5, especially impressed by the front face design and the light source. When referring to the power, he said that "you can go out with a little strength under your feet". This driving experience undoubtedly adds more confidence and beauty to his life.

Create an extraordinary dark blue car! Less than 175,900

For most office workers, the first demand for buying a car is to travel instead of walking, and considering practicality, many of them can meet this requirement. For most people, it is only the beginning to mention cars from 4S shops, and the cost of car maintenance in the later period is the big deal. So what I said today can help us save some money in the future. Let’s take a look at its performance.

First of all, from the appearance, the front face of the dark blue G318 looks more comfortable and looks very cute. Coupled with the rounded headlights, it is full of elegance. Coming to the side of the car, the car adopts avant-garde lines, and the body gives people a very cool feeling. With large-sized thick-walled tires, smooth lines run through the whole side of the car. In the design of the rear end, the overall shape of the deep blue G318 rear end echoes the front end, and the taillights present a fashionable and simple design style, which looks very fashionable as a whole.

When I came into the car, the interior adopted an eye-catching design, which highlighted the layered effect. The steering wheel design of the car is very eye-catching and has a good grip. From the central control point of view, the design of the center console is reasonable, which makes the interior design quite layered and has a certain sense of science and technology. Let’s take a look at the dashboard and seats again. The car is equipped with a round and lovely dashboard, which is very eye-catching. The seat is wide and thick, and the overall comfort is good.

Do you have the urge to buy a car after reading the whole article? Let me make a summary. Many people buy SUVs because of their stronger passability. The car is practical and fully equipped, and it is a good helper for home travel.

Chinese modernization is a coordinated modernization of ＂five civilizations＂

　　[In-depth study and implementation of Socialism with Chinese characteristics Thought of the Supreme Leader in the New Era]

　　　Author: Qin Xuan (Dean of New Era Socialism with Chinese characteristics Thought Research Institute, Supreme Leader of China Renmin University)

　　Realizing modernization is an important historical task shouldered by our party since its founding. After arduous exploration and unremitting struggle of revolution, construction and reform, the Party led all the people of China, and finally completed the industrialization process that developed countries have gone through for hundreds of years in decades, creating a modernization miracle that attracted worldwide attention, creating a Chinese-style modernization road and a new form of human civilization, thus expanding the way for developing countries to modernize, providing new choices for those countries and nations in the world who want to accelerate their development and maintain their independence, and contributing China wisdom and China’s plan to solving the world modernization problem.

　　Human civilization is an organism composed of "five civilizations"

　　Marxist historical materialism holds that human society is an organic whole with complex structure composed of basic elements such as productive forces, relations of production, economic base and superstructure, in which all factors are interrelated and interact with each other, promoting the movement, change and development of the whole social organism. Specifically, human society is a tight organic whole composed of economic, political, cultural, social and ecological factors. The social civilization of human beings is the progressive state and positive achievements of human beings in understanding and transforming the objective world and the subjective world, including five civilizations: material civilization, spiritual civilization, political civilization, social civilization and ecological civilization. Among them, material civilization refers to the state and achievements of development and progress in the economic field, and it is the progressive state and positive material achievements of human beings in transforming the objective material world, which is composed of production mode civilization and lifestyle civilization; Spiritual civilization is the progressive state and positive achievement of human understanding and transforming the subjective spiritual world, and refers to the state and achievement of development and progress in the cultural field, which includes ideological and moral construction and educational, scientific and cultural construction; Political civilization refers to the progressive state and achievements in the political field, and it is the progressive state and positive achievements of human beings in transforming political society, including political system civilization and political behavior civilization. Social civilization refers to the progress and achievements in the social field, and it is the progress and positive achievements of human beings in understanding and transforming society, including social life civilization, social relations civilization, social consciousness civilization, social environment civilization and social management civilization.Ecological civilization is a progressive state and positive achievement of human beings in understanding and coordinating the relationship between man and nature. It includes not only the practical achievements of human beings in protecting and improving the ecological environment in the process of developing material civilization, but also the improvement of the harmony between man and nature and the enhancement of people’s ecological concept.

　　In the process of the evolution of human civilization, the "five civilizations" complement each other and are dialectically unified. They are relatively independent and different, but also interdependent, interactive, interpenetrating and transforming. Among them, material civilization is the foundation and provides necessary material conditions for the development of other civilizations; Political civilization is the guarantee, which provides political guarantee, institutional support and legal guarantee for other civilizations. Spiritual civilization is the soul, providing ideological guarantee, spiritual motivation and intellectual support for the development of other civilizations; Social civilization is the condition, which provides social order foundation, social development guarantee and social organization support for the development of other civilizations; Ecological civilization is the premise, which provides ecological foundation, environmental conditions and rich resources for the development of other civilizations. The internal tension and contradictory movement formed by these five civilizations promote the progress of the whole civilization of human society. If the development of a certain civilization element lags behind, it will restrict other civilization elements, cause the disorder of organism operation and affect the healthy development of the whole society.

　　Marxist classical writers believe that social comprehensive production is a systematic and holistic production formed by the interaction of various social factors, which inevitably requires the coordinated development of the "five civilizations". Before the capitalist society, the degree of social civilization was not high because of the backward social productive forces and the low material civilization seriously restricted the progress of other civilizations. However, in capitalist society, due to the insurmountable antagonistic contradictions between productive forces and production relations, economic base and superstructure, people and nature, people and society, and people and people have formed sharp opposites. Due to the inherent contradictions that cannot be overcome by themselves, capitalist social organisms will eventually die out due to multiple accompanying crises such as economic crisis, political crisis, cultural crisis, social crisis and ecological crisis. Socialism will replace capitalism because socialist society is an all-round development society, which can coordinate the relationship between man and nature, man and society, and man and man, and promote the coordinated development of material civilization, political civilization, spiritual civilization, social civilization and ecological civilization.

　　　The coordinated promotion of "five civilizations" is a distinctive feature of the Chinese modernization road.

　　Looking at the historical process of world modernization vertically and comparing the development level of modernization in other countries horizontally, we can easily find that Chinese modernization has both the universal characteristics of world modernization and the distinctive characteristics of China.

　　General Secretary of the Supreme Leader stressed that the modernization of our construction must have China characteristics and conform to the reality of China. China’s modernization is a modernization with a huge population, the common prosperity of all people, the coordination of material civilization and spiritual civilization, the harmonious coexistence of man and nature and the peaceful development path, which is the direction that China’s modernization must adhere to. At the celebration of the centenary of the founding of the Communist Party of China (CPC), General Secretary of the Supreme Leader clearly pointed out: "We adhere to and develop Socialism with Chinese characteristics, promote the coordinated development of material civilization, political civilization, spiritual civilization, social civilization and ecological civilization, and create a new road of Chinese modernization and a new form of human civilization." This shows that the coordinated promotion of the "five civilizations" is a very distinctive feature of the Chinese modernization road.

　　Since its establishment, the Communist Party of China (CPC) has been exploring the modernization road of all-round social development under the guidance of Marxism. In January 1940, Comrade Mao Zedong clearly pointed out in "On New Democracy": "We communist party people have struggled not only for the political revolution and economic revolution in China, but also for the cultural revolution in China for many years; The purpose of all this is to build a new society and country of the Chinese nation. In this new society and country, there are not only new politics and economy, but also new culture. " After the founding of New China, in the process of exploring Chinese-style modernization, the Party has constantly improved the overall layout of Socialism with Chinese characteristics, from putting forward the "four modernizations" to realizing material civilization, to grasping both material civilization and spiritual civilization, to coordinating and promoting the construction of material civilization, political civilization, spiritual civilization, social civilization and ecological civilization, and from grasping the all-round development of society to promoting the all-round development of people, the Party has always regarded modernization as an all-round modernization. Gradually formed the idea of coordinated development of "five civilizations", and organically combined economic, political, cultural, social and ecological system reforms under this guidance, forming the overall layout of coordinated promotion of "five civilizations". The formation of the coordinated modernization layout of the "five civilizations" shows that the Communist Party of China (CPC) people have a clearer understanding of the modernization laws of human society.We have a clearer idea of what kind of modern power to build and how to build a socialist modern power.

　　After more than 70 years since the founding of New China and more than 40 years of reform and opening-up, especially 10 years since the 18th National Congress of the Communist Party of China, the Communist Party of China (CPC) has always insisted on promoting the development of material civilization with economic construction as the center, political civilization with political construction as the guarantee, spiritual civilization with spiritual and cultural construction as the inner soul, social civilization with social construction as the necessary condition, and ecological civilization with ecological civilization as the solid cornerstone. It has achieved a historic leap from economic development to coordinating the development of socialist material civilization, political civilization, spiritual civilization, social civilization and ecological civilization, formed a development pattern of economic prosperity, political democracy, cultural prosperity, social equity and good ecology, created a Chinese-style modernization road and a new form of human civilization, solved many problems in the development of human society, and abandoned the old modernization road of western capital-centered modernization, polarization modernization, materialism expansion modernization and foreign expansion and plunder.

　　Coordinated promotion of "five civilizations" is the fundamental way to build a socialist modern power.

　　The 19th National Congress of the Communist Party of China drew a grand blueprint for the second century and put forward that "China should be built into a strong, prosperous, democratic, civilized, harmonious and beautiful socialist modernization power". By that time, China’s material civilization, political civilization, spiritual civilization, social civilization and ecological civilization will be comprehensively improved, the national governance system and governance capacity will be modernized, and it will become a country with leading comprehensive national strength and international influence. The common prosperity of all people will be basically realized, and our people will enjoy a happier and healthier life. The Chinese nation will stand among the nations of the world with a more high-spirited attitude. " In order to build China into a prosperous, strong, democratic, civilized, harmonious and beautiful socialist modernization power in the middle of the 21st century, we must continuously promote the coordinated development of the "five civilizations" and realize the comprehensive promotion of the "five civilizations".

　　In terms of material civilization construction, we should adhere to Socialism with Chinese characteristics’s basic economic system, always take economic construction as the center, achieve high-quality development with innovation as the first driving force, coordination as the endogenous feature, green as the universal form, opening up as the only way, and sharing as the fundamental purpose, promote quality change, efficiency change and dynamic change of economic development, focus on solving the outstanding problems of insufficient development imbalance on the basis of continuous development of productive forces, and ensure that all people have more sense of gain and happiness in economic construction.

　　In the construction of political civilization, we should adhere to the organic unity of the party’s leadership, the people being the masters of the country and governing the country according to law, strengthen the construction of socialist democratic politics, unswervingly follow the road of political development in Socialism with Chinese characteristics, promote the development of socialist deliberative democracy, promote people’s democracy in the whole process, promote a more sound democratic system, enrich democratic forms and broaden democratic channels, enable the people’s subjectivity to be implemented in the political and social life of the country, and enable all aspects of systems and state governance to better reflect the people’s will, protect people’s rights and interests, and inspire the people.

　　In the construction of spiritual civilization, we should adhere to the guidance of Marxism, firmly grasp the leadership of ideological work, build a socialist ideology with strong cohesion and leading force, vigorously cultivate and practice socialist core values, strengthen the construction of advanced socialist culture, promote the creative transformation and innovative development of China’s excellent traditional culture, stimulate the creative vitality of the whole nation’s culture, better build China spirit, China values and China’s strength, and consolidate the common ideological foundation of the United struggle of the whole party and people of all nationalities.

　　In terms of social construction, we will persist in strengthening social construction with the focus on safeguarding and improving people’s livelihood, and continue to exert our efforts to provide education for young children, education for learning, income from labor, medical care for the sick, security for the old, housing and support for the weak, so as to make people’s sense of well-being, happiness and security more substantial, secure and sustainable. By promoting the modernization of social governance system and governance capacity, we will continuously improve the civilization of the whole society and promote a more harmonious and orderly society.

　　In terms of ecological civilization construction, we should adhere to Lucid waters and lush mountains are invaluable assets’s idea, adhere to the integrated protection and systematic management of mountains, rivers, fields, lakes, grass and sand, protect the ecological environment like eyes, treat the ecological environment like life, integrate ecological civilization construction into economic construction, political construction, cultural construction and social construction, and more consciously promote green development, circular development and low-carbon development, and adhere to the road of civilized development with production development, affluent life and good ecology.

　　In coordinating and coordinating the "five civilizations", we must always adhere to the Party’s overall leadership over modernization, adhere to the people-centered development idea, adhere to the systematic concept, coordinate the two overall situations at home and abroad, face the major social contradictions, conscientiously implement the new development concept, strengthen forward-looking thinking, overall planning, strategic layout and overall promotion, and unify the construction of "five civilizations" into the great practice of building a socialist modern country. It is reflected in the principles and policies, strategies and tactics, policy measures and work arrangements of China’s development, avoiding the abnormal development of sacrificing one or several civilizations in exchange for the development of other civilizations, and ensuring the overall promotion and coordinated development.

Chengdu Auto Show is a real shot of Tengshi Z9GT, a 300,000-class luxury and personalized choice？

At the 2024 Chengdu Auto Show, Hall 9 of BYD Haohengbao, its subsidiary, Equation Leopard, Wangwang brand, BYD Ocean and Dynasty models all gathered together. Hall 9 is also one of the most popular pavilions in this auto show, and a variety of heavy and popular new cars have attracted the audience to punch in.

Among them, the Tengshi Z9GT in the C position of Tengshi booth is also surrounded, showing its popularity! According to Brother Gu, Tengshi Z9GT is a brand-new flagship new car, which integrates performance and luxury. The pre-sale price range is 339,800-419,800 yuan. The new car will be on the market soon. With the Chengdu Auto Show, we can see how powerful this GT model equipped with a brand-new technology platform is!

Tengshi Z9GT adopts a brand-new design concept-elegance in motion, with slender side, short front and rear suspension and long wheelbase, which makes it look very elegant and dynamic. It is said that this car has the design aesthetics of standard Paramera. Although it has a slender body, the turning radius of Tengshi Z9GT is only 4.62m, and the body of 5m 2 is more flexible than A0 class car, so there is no pressure for city driving.

The front of the car is in a dive posture, and the sharp and narrow headlights and the muscle lines on the hood strengthen the sense of strength of the front of the car. The taillights create an extended visual effect, and Tengshi Z9GT also uses the design of double tails to further reduce the drag coefficient of the car body. The design including the rear bumper is also very layered, which increases the recognition of the tail. The tail is marked with the logo "E" of Easy Tripartite Technology, which can be regarded as BYD’s confidence in its own technical strength.

Tengshi Z9GT’s car has realized the integration of technology and luxury. On the one hand, the car is wrapped in a large area of leather material, giving a good touch. On the other hand, it is a large-sized central control panel, LCD instrument, co-pilot screen, etc., which creates a better intelligent cockpit atmosphere.

In terms of configuration, it is known that Tengshi Z9GT provides 128-color ambient light, intelligent cold and warm dual-temperature refrigerator, privacy glass, electric side window sunshade, headrest audio, etc., and the interior space is comparable, which is expected to bring a comfortable experience beyond luxury cars of the same class.

It is worth mentioning that Yi Sanfang has created a number of world-first and world-leading functions based on four core technologies: three-motor independent drive technology, rear-wheel dual-motor independent steering technology, VMC vehicle motion control technology, and CTB battery body integration technology. In other words, Tengshi Z9GT can realize the functions of compass U-turn, easy three-way parking, low-attached pavement stability enhancement system, intelligent crab walking and so on.

Write it at the end

After the success in the field of MPV and SUV, Tengshi is about to open up a new GT track. Tengshi Z9GT has conquered users who are unwilling to be mediocre with its elegant and sporty appearance. Internally, it is based on luxury, technology, and easy tripartite technology to achieve a flagship GT with strong comprehensive strength. At present, 300,000-level optional new energy luxury GT models are few, and Tengshi Z9GT takes the lead and is expected to win new market segments! (Text /MANGO)

标签归档西安桑拿会所

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