Service Market for enterprises, Another golden age for China Internet Market
In the year of 2000, Yaxin, a To-B enterprise service vendor, was successful to list in NASDAQ in USA, in the meanwhile, Baidu, AliBaba, Tencent, they just start their internet business in the very beginning stage. At that time, China step into the development of internet business, these 3 younger companies rode the wind of development boat to enter the golden age to To-C business. Just past a decade, they become the famous three swordsmen in China internet market in the name of BAT, however, YaXin, the enterprise service vendor, is already fading in the memories of people.
When the time to the year of 2018, China internet market development just past 2 decades, but the market sharing battle is going into the critical moment. Enterprise service, Big Data, AI, which is the key to win this battle. Enterprise service is also be the one of the most dynamic industry since the year of 2018 ever. To-B business for enterprise service market, it is the time to turn back the light spot in the market.
Enterprise service field went through from none body asking to be the apple of eyes, the wild differential treatment contributes to the market environment changing.
First of all, the number of medium and small companies increase the related service needs by themselves boost.
By the end of 2017, the members, listed in medium, small and micro enterprises in China’s directory, had already reached at 73.281 million, with the average of 19 percent per a thousand people. For advance the development of medium, small and micro enterprises, our state council carry out multiple new policies to reduce the operation running cost and support them development in many aspects, such as reduce the registration cost, changing the registration system as the Capital subscription registration system, relax the restriction of company registration conditions, other lower the business running operation cost from government and society aspects.
In such circumstances, medium and small-scale enterprises boost since ever, therefore, new companies opening request bring a series service demands, e.g. company decoration, brand registration, finance requirement, administration issue, law supporting, etc. thus, it accelerates the development of the enterprise service business.
The benefits from the boost population is decreasing, so as to bring the new issue from enterprise which directly increasing the cost of human resources.
With the past 20 years of the development of China internet market, the benefits from the boost population in To-C business is gone already, however, there is new issue pop up at this moment, they must face the higher and higher cost in human resources. On the contrary, many of them don’t have enough capital to deal with that, due to this spending part occupied the most flow cash quota. Therefore, how to balance this issue and cut down the cost expenditure, to ensure no impact on normal business and company development, this is what is the enterprise service vendor doing, such as to provide the non-core business solution, leasing business, and sharing service, to conquer this problem.
The transformation of light asset operation for enterprise promotes the development of leasing business in the enterprise service field.
How to lighten the enterprise asset is the major direction for them development in near future. As it was, all non-core business can be outsourced to a 3rd party, e.g. finance working, administration job, legal issue, and other unnecessary soft services, which all can be provided by enterprise service vendor. In the hardware aspect, e.g. office computers, office furniture, printer etc. it is easy way to use leasing service to set up. This way helps these companies to reduce the expenditure and concentrating more money at them core business, instead of spending capital investment at non-core business.
These characteristics of medium and small-scale company create a greater demand for enterprise services.
Because of short time for these new opening enterprises to develop, they have no clear about themselves business model, and neither formed by a mature operation management system, particularly for IT system and other related departments which need to invest fixed costs, e.g. finance, legal and so on. Due to the uncertain factors from themselves business in the beginning stage, they willing to have them by 3rd party enterprise service company, rather than spend a lot of investment on these departments’ construction. In additional, the younger entrepreneurs have a high degree of acceptance for the internet, they used to use Apps tool, access internet website, especially mobile internet. It is an economical way to set up them by enterprise service company, to speak of, iCould enterprise service is one of the most economic method.
Across the Pacific, learning from US, enterprise service field will be the next billionaire business market.
Looking around the world, there are about 1,500 companies with a global market value of over $5 billion. Compared with China and the United States economy, all the top companies in the industry almost at 1:1 ratio.
In the internet field, the United States has Google, Amazon, Facebook, China has Alibaba, Tencent, both of them all have the market value more than 500 billion US dollars. In the energy industry, the United states has ExxonMobil, Chevron, China has Sinopec, PetroChina and State Grid. The same situation in the real estate industry, banking and so on. On the contrary, in To-B field, the United states has SAP, IBM and other more than 500 companies which market value more than $50 billion company, but China has only 3 companies in this field.
In the domestic, To-B, an enterprise service market, is still a virgin land, it will have more participates and competition in near future.
In this competition, how to stand out among the peers? How to take the opportunity in the competition, to create enterprise service scenario and provide a better service for enterprises, this is the question need to think through by enterprise service vendors.
How to break through this battle?
Supply chain integration and product standardization.
No matter To-B or To-C enterprises, be the one outstanding in the industry, the first of all is to do a good job in service. Tips as the following:
Select high quality supplier.
To many medium and small-scale enterprises, to let a service vendor to provide a package service instead of themselves is the simple and convenient running way. Because they already did the selection and filter process from the supplier chain in the market, eliminating the poor quality and unprofessional service companies. To be a best service vendor, it must put themselves, especially invest in manpower and material resources, into the supply chain, and integrate the whole service supplier chain.
First, unify service process, and make a service quality standards.
Service vendor also need to know the characteristic of downstream firm, pricing information and types of service. To meet the different users’ requirements, they have to sort out and unified service process, to make sure these firms provide service reach the standard. At last, vendor should improve the quality control system, and respond the request from users in time and send professional person to fix these issues.
At present, the overall level of information technology in China’s medium and small-scale enterprises is not popularization and acceptability. According to the latest data from informatization industry situation and development trend analysis report in medium and small-scale enterprises in 2016, there is only 10% of them to use EPR and CRM system solution, 6% of them to use SCM system solution. When we are in the advanced informatization stage, most of medium and small-scale enterprises still use the manual work rather than using Big Data, Enterprise iCould service, to deal with the routine work in financial management, HR management etc. Regarding to the authority data survey, more than a half of them willing to improve their capacity and product and service quality by using 3rd party service vendor to lift informatization in all aspects.
Therefore, many medium and small-sized enterprises need information services, and software system development services. To provide high quality information services, it is an essential ability for a good enterprise service vendor.
Nowadays, most of the medium and small-scale enterprise owner spend more time on the core business, so that when non-core business request pop up, they want the service vendor to support them by one-stop service, for a example, when a new company opening, they may need to decorate the office, rent green plant, rent computer and printer, and clean-keeping issue, etc. If find and contact them with many companies, it will be not easy to settle these issues. Just having a hypothesis, if service vendor has a such a platform, can combine these businesses from online and offline, for those small company owners, they just need to contact with one person to settle all the issues, that will save a lot of time and energy on these non-core businesses. Furthermore, one-stop service solution can save more money and investment for a small company.
Except one-stop service solution, scenario service is the most active demand for those small companies, because scenario service will be customized for different enterprises from their various needs and characteristic. For an example, in the finance industry, using the 3rd party service vendor is easy-to-use, standardized, fast access, and flexibility, rather than single model. From the above, how to create scenario service is the core competence for the enterprise service vendor.
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