The leader of every enterprise may think about a question every day, that is, how can we find a better and smarter way to run our business in the face of fierce competition? At the same time, we have also heard many people talk about the concept of "supply chain management", as if this concept is a clever way to solve the problems we are facing now. Let me try to discuss these problems mentioned just now.
In the past twenty years, our business model has really changed a lot. Let's think carefully about how much the global market economy has affected our lives. In the past, Coca-Cola may only be an American drink, but today Coca-Cola is as common as drinking tea in China. Lenovo computer is a product of China, and it is a very good product, but today Lenovo computer can be bought not only in China, but also abroad. These are all phenomena brought about by changes in the global market.
I remember more than 20 years ago, when I was a child, I saw that my dad's business model was really different from our current business model. I still remember that my father paid attention to producing many products in business at that time, because the economic model at that time was dominated by sellers. As a producer, I want to produce things, and this market will absorb what I produce. At that time, enterprises were most concerned about how much they could produce every day, and the productivity of workers was my greatest concern at that time. At that time, inventory was not a very important factor for our enterprise. However, due to the changes in this market, a new economic model has gradually emerged, from the seller-led in the past to the buyer-led now.
The buyer-led economic model is indeed very different from the previous economic model. Now, as an enterprise, we can't say anything about what I produce. My customers just want to buy these things. Now, on the other hand, as a leader of an enterprise, I may ask my customer what kind of things he needs and when he needs them. Great changes have taken place in the whole economic structure. On the one hand, it has greatly changed our whole production mode and the relationship between consumers, manufacturers and distributors, from the original typical economic model to the new economic model. Of course, under the macroeconomic trend, there are actually three major changing factors. The first aspect is economic globalization. The second factor is global electronization. The third is time, which is very important for us as business people and our customers. Therefore, we need to find a new way of operation. The industry of express delivery came into being, which are the three major changes we have seen in the new macroeconomic trend.
Let's look at it from the perspective of economic globalization. Now, I believe that there are offices in most parts of the world, which is a very obvious manifestation of economic globalization. An Apple computer, I don't care where it is made, but I believe its parts and accessories are shipped from all over the world and then manufactured. This is also the result of economic globalization. Of course, FedEx, as an international courier company, will provide international courier services to our customers all over the world. No matter which country my customer is in, we hope he can enjoy the benefits of express delivery service. This is the result of economic globalization. Of course, the development of transportation and communication in the new century are also great driving forces to accelerate economic globalization.
Let's look at the trend of global electronization. I want to do a simple survey here. Raise your hand if you had a mobile phone ten years ago? Not much, one or two, I believe they are all important people. Today, many people should have mobile phones. On the other hand, who doesn't have a mobile phone today? Let me do another survey. Five years ago, those of us who had emails, please raise your hand. (Not much! But today, if you have an email address, please raise your hand? It's all there! Now, in fact, email is like a home address. Asking for my home phone number and address is like asking for an e-mail address. Another question is, three years ago, people who wanted to check information online every day raised their hands? (Not much! But today, almost no one doesn't want to look up information online. In fact, global electronization has completely changed the whole business form silently. Due to the influence of globalization, we have to see many high-tech products exported and many high-tech products imported. Because of the import and export of these high-tech products, its demand is very different from before, which has greatly changed our whole mode of transportation.
I believe that because of the development of global electronization, the Internet has become very popular now. Personally, I think that the biggest benefit brought by the Internet is to make the world smaller. More importantly, in the past, once you mastered a certain amount of information, you might become an industry leader in business activities. But now, the Internet has changed the rules of the game, and information is no longer a weapon owned by individuals. Now through the Internet, data and information have become public wealth. Each of us can find information through the Internet to help us deal with the problems we face, which I personally think is the greatest benefit brought by the Internet. Due to the development of Internet, e-commerce came into being. In fact, there are many topics about e-commerce among us. The hottest topic now is whether to engage in B2B or B2C. In fact, we have a lot of arguments in this regard. My personal opinion is that from the current development and the influence of the Internet, I think B2B will be the focus of our development in the next few years. Personally, I think B2B is the focus of our e-commerce development in the next few years. Why do I say that? In fact, the business model of B2B is not much different from our previous business model. Just because there is not much difference, as leaders of enterprises, it is easier for us to transfer the old economic model to the new one. In fact, the difference between B2B and the past is that it can use advanced technology to improve its timeliness, information and more importantly, customer satisfaction. More importantly, I believe that in the next few years, the development space of B2B in e-commerce will be greater than that of B2C. Of course, when B2B has a good foundation, I believe B2C will also have new development. In fact, it is similar to our previous business model. We still remember that we once bought something. At first, we all went to department stores, but gradually, we had to sell things directly to our homes. In fact, this has a very important relationship with the development of B2B and B2C.
After talking about the influence of electronization and the Internet, and then talking about e-commerce, I will talk about how important time is to us now.
My boss gave me a task the other day. I asked him, hey, boss, can you give me a week to finish this task? But he told me jokingly: actually, I hope you finished this task yesterday. From this conversation, we understand how important the prescription is to us now.
On the other hand, in the past, when you did business with some foreign companies, you would be given transportation time, which may be one month or three weeks. But now, it can't actually give you that long time to transport the goods it ordered from your side to his side. He can only give you a short time to deliver the goods. The new business model has brought a lot of profits to Dell computer, but what is the biggest factor of the new business model? Here is the prescription. In the past, as a computer manufacturer, I might spend a month making computers and then two weeks shipping them to dealers. It took the dealer a few days to put the products in the store and sell them to these consumers. But Dell computers operate in a completely different way. It drives away the seller in the middle and talks to the customer directly. Another more important factor is that he promised his customers that I could give you the computer you requested within five days through the Internet and my customer service department, which won them a lot of business in terms of timeliness. Therefore, time plays a very important role in globalization. It is precisely because time plays an important role in the whole economic model that some traditional modes of transportation in the past can no longer meet the needs of customers now, so the express delivery industry came into being. Some friends here may think that these express mails may only be trivial matters such as transporting documents, but what I report to you today is that express mails now handle not only small documents and small packages for customers, but in fact, many customers now handle hundreds or thousands of boxes of things through express mails.
In fact, express mail has the following definition. The first is, of course, fast and can meet the needs of customers in time. More importantly, punctual delivery also plays a very important role. For example, I told my customers that we can deliver the goods to you soon and in two days. The customer may arrange his workflow according to these two days, but if we can do it for two days today, but it may be three days tomorrow, I may deliver it to him in one day on the third day. An unstable and untimely service really can't meet the needs of customers, so as a successful courier company, timely delivery is very important. The third definition of express delivery is that these customers who are now using fast not only hope that we can deliver this thing to his customers quickly and on time, but more importantly, hope that he can check the parcel order at any time during transportation. For example, we promised to ship this thing from point A to point B in three days, but the parcel was not delivered to his customer the next day. At that time, customers will contact these courier companies and say, "Tell him, hey, where is this parcel now?" Maybe I don't want to deliver this package to the place I hoped, but I want to deliver it to other places, so we need to provide delivery orders to our customers at any time. So express delivery contains three main elements, the first element is fast; The second element is punctuality; The third element is to provide orders to customers.
Express service has really helped the global economy and global electronicization, which is why many companies now hand over their transportation processes to our express companies.
After we talk about some changes in the global economy, let's talk about supply chain management. Because there are many topics now, many people think that supply chain is a good way to solve the problems faced by enterprises now. Let me define the supply chain first. In fact, the most important task of the supply chain is to connect suppliers, manufacturers and consumers, and then use advanced technology and their global network to transport the services that customers need from point A to point B in the fastest time. More importantly, in this transportation process, if the customer has any changes, it can respond at any time with the help of advanced technology, which is the best thing that the supply chain now provides to modern enterprises.
In fact, the concept of supply chain has changed greatly in our business model in the past 15 years. I want to share some data with you. Before 1994, 0/7% of the goods in the United States were transported through the concept of just-in-time supply chain management. But this year, this number has increased to 47%; This shows how much influence the new mode of transportation has on the overall business activities.
Let me share with you another data, what kind of influence the supply chain has on our current traffic. 198 1 year, the logistics cost of the United States accounts for about 17% of the total GDP of the United States, but now the logistics cost only accounts for 10% of the total GDP of the United States. What does this tell us? This tells us that logistics activities are not decreasing, but the cost of logistics is decreasing through the concept of supply chain management and just-in-time system, which is of great help to our enterprise. Because of what? In the past, maybe our profit margin was 20% or 30%, which was a good business. At that time, the transportation cost accounted for 20% and 30%, which was no big deal, but today our profit is 10%. Let's see how much our wages have increased in the past ten years. My salary hasn't increased much in the past ten years, but I believe all of you here will at least double or quadruple your salary in the past ten years. If this is the case, we can see that the relationship between them is that no matter the profit rate drops, the selling price of goods keeps falling. For example, labor costs are rising, and so is my rent. How can I guarantee that my profit will not change because of this? I will use my brains in this mode of transportation. This kind of supply chain management is precisely the best tool to meet our needs as business leaders to reduce costs, which also represents the main reason why logistics costs keep the overall GDP of the United States down. We don't mean that the things transported are smaller than before, we just transport more things in a better way, and then let our costs continue to decrease. This is a timely help to our enterprise in the supply chain.
Share a case with you, that is, how FedEx cooperated with a large semiconductor company in the world to change their previous transportation mode into the current system transportation mode. Because FedEx has a lot of knowledge about the supply chain, the company contacted FedEx about five years ago. First, he wants us to cooperate to reduce their transportation costs; Second, it is more important to improve customer satisfaction. They contacted us five years ago, hoping that we could solve these two problems for them. After receiving this plan, we asked our customers to introduce their mode of transportation, and then drew two pictures for them according to the introduction, a very special picture. After reading this picture, you don't even know what it tells you, because it's too expensive. From this picture, we can know that he used more than 20 airlines to deliver goods to him, he used more than 40 shipping companies to deliver goods to him, and he has 20 warehouses around the world. At that time, his inventory was about one month: at that time, the average time for them to deliver products to customers was two to three weeks. Five years ago, I believed this was acceptable, but today, if they still manage their transportation in this way, I believe they will definitely go out of business. Why? Now in the high-tech industry, if the inventory lasts for more than two or three weeks, the money will be lost a lot. We look at a new model of computer, which can sell for 2000 dollars, but I believe that a new model will be available in two or three weeks, and soon the computer with 2000 yuan may be reduced to 1500 dollars. If it takes two or three weeks, I believe it will drop a lot. If the way we do business now is to keep inventory for one month, I don't know how much the loss in inventory alone is. Because of this, we got a brand-new method for our customers: first, we told them that because there are my offices all over the world, my plane can fly to most parts of the world, and more importantly, we are all connected to the global information network. So, you don't have to use many airlines, many freight companies, just give it to my home. More importantly, you don't need to have your own warehouse in 20 places around the world. You just need to rent a warehouse in a central point of our company through my network, and then my plane and network are connected to this warehouse, so you don't need to run 20 warehouses, so at that time we got him a warehouse in subic bay, Asia. Because of this change, we can change his transportation time from an average of two to three weeks to two to three days now. Let's take their customer service to the next level. Why? Because many times after his customer has placed an order, he may need to inquire when the order will be delivered to him. Because of this demand, we brought their customer service department. His customer service network is linked with our customer service network, so I will provide first-hand information to his customers and tell them clearly when his order will be delivered. This is our timely success story. Therefore, it is easier to solve this problem through one company than to find multiple companies to solve the same problem.
After talking about FedEx's solutions to customers' logistics requirements, I would also like to take this opportunity to introduce some developments of FedEx in the world and what we can do in logistics management. We now handle about 3.2 million packages every day, and now we can provide services in 265,438+00 countries. We now have 643 planes in the world, and FedEx should be the largest international express company in the world. 643 planes are actually connected to our global network. We acquired Flying Tiger Airlines on 1989, which helped us a lot, because this company has many air rights all over the world. Thanks to these rights, 643 planes can now fly to 366 airports around the world. I believe that the place we are serving now can cover 9 1% of the global GDP. Of course, we may not go to some tourist places and some very remote places.
FedEx is an American company, 1973 was established in the United States, but the Asian market is also very important to us, so at 1984, we started to expand our network in Asia. We have about 6,000 employees in Asia, and there are planes connecting Asia 18 major cities every day. We have warehouses in many places all over the world. These warehouses are good tools for our customers to store goods with me. On the one hand, you can save your own expenses on warehouse management. More importantly, because it can store its goods in my warehouse and then use our global network, its products can be transported from one place to another in the shortest time. A long time ago, there was a movie called Traveling Around the World in 80 Days. I believe that my client can travel around the world in five days if he uses my global network now. Of course, if we want to provide a good network, besides airplanes and warehouses, it is more important that we use advanced technology. I will give a figure as a reference to illustrate our efforts in advanced science and technology. What was a question that everyone was very concerned about last year? Y2K problem. We FedEx used advanced technology to help us a long time ago. From 1996 to 1999, we spent 2 billion dollars to solve the Y2K problem. From this aspect, you can understand that we helped us with advanced technology so early, and let you know how important advanced technology plays in our company now.
In fact, we are using advanced technology now, not that there are many computers in the office, but many lines connecting our network. We do have advanced technology today. For example, our deliveryman holds a computer in his hand, picks up one from a customer, and uses a scanning pen to save some information on our terminal. In addition, in some areas, our deliveryman has a computer in his car, just like the one in the headquarters. On the one hand, these advanced technologies can improve our productivity, and more importantly, let us form a huge network to provide customers with the best service and meet their ever-changing needs, so we are really proud of it.
In fact, FedEx is ahead of other companies in e-commerce. For example, in the application of e-mail, in fact, before 15, each of our employees had e-mail as a way of communication. We also have our own web page, which provides a lot of information for our customers. On the one hand, customers can inquire about our company's information through my webpage, and more importantly, they can use my service through this webpage. For example, he can provide some services and some bills of lading through this webpage. More importantly, he has a bill of lading number for sending things through our company, and he can find the package information through my website. A few months ago, I joked with my friends in the media that now I can't stop the company from finding me, because if I bring my computer, the company can find me anywhere. So is my client. If he has a computer and knows how to surf the Internet, he can find the information of his bag at any time. For example, if I am a producer, I sent this to one of my clients in America a week ago, and then I took a holiday. But this customer called my mobile phone and said, Chen Jialiang, I haven't received what you sent me. What should I do? If I have the bill of lading number, I also have a mobile phone. Now we can access my website via mobile phone and find the package information. Use this phone to access the FedEx network. I have the bill of lading number, so I can know where the package is. I told him that the package had actually been sent to you, but your secretary kept it and he could solve the problem. We have really solved many problems for our customers by using e-commerce.
We are now establishing contact with many website companies. On the one hand, we can use the products proposed by my e-commerce to expand his business. I have many different e-commerce products for them, and they can also serve their customers through their own modes of transportation.
The future is indeed a network world. In my opinion, we should understand the changes in the network so that we can all deal with our future business activities.
As a conclusion, I hope to borrow a sentence from Time magazine and some things that can be determined in the next century, including that the world will be interconnected, networked and globalized. The world is further connected through the Internet, and the trend of globalization cannot be changed.