The embarrassment of e-cigarette entrepreneurship: it can’t change upstream manufacturers, and can’t afford downstream channels.
Editor’s note: This article is from WeChat public account ” Bullet Finance” (ID: wwwhygc), author Krupp.
“I think that in the future, e-cigarettes will become China’s pride like mobile phones.” Xiaomi’s former No. 21 employee, now the owner of Xike Electronic Cigarette, Zhong Yufei, recently had an e-cigarette in Beijing. Said in the offline salon.
Whether he was asked if the e-cigarette could still see the spring of next year, he confidently said “can”, but he still needs two conditions to boost – “the evil capital and the terrible policy.”
In this industry’s enthusiasm, capital has already run into the market: since April 2018, Ai Zhuo won 300 million A round of financing, and in July 2019, Ono electronic cigarette won 30 million A round of financing. … At least 20 e-cigarette companies have received more than 30 financings in this one-year and three-month period.
Incomplete statistics show that in the first half of 2019, the total amount of financing for the e-cigarette industry exceeded 1 billion yuan.
For a time, the city has burned e-cigarettes, and many Internet celebrities have started to sell their cigarettes in the e-cigarette field–
The first industrial designer of WeChat, Zhu Xuanya, made a mountain cigarette electronic cigarette;
Cai Yuedong, who sold the same uncle IP, and He Chang, who did not make the Huangtaiji pancake, founded Yooz e-cigarette;
Haughing Tech No. 001 employee Zhu Xiaomu left Flow to make a flow of electronic cigarettes after the hammer broke out;
The founder of Hammer Technology, Luo Yonghao, and the vice president Peng Jinzhou did not hold it, and together they made Xiaoye e-cigarette;
The former senior manager of Xiaomi Zhong Yufei founded the Xike electronic cigarette, and another former employee, Shan Xiaopeng, made the YMK electronic cigarette;
The five well-known media people set up the electronic cigarettes together…
This industry is really lively today, and there is a kind of “eight immortals crossing the sea, each showing its power”.
In early August of this year, Li Nan, a former senior executive who had just left Meizu, revealed why he did not choose the e-cigarette industry to start a business: “1500 companies, this industry is too noisy now.”
Why does the domestic e-cigarette industry become so “stubborn” within one year? In addition to the disappearance of the Internet dividend, capital is in urgent need of another new turmoil to “hematopoietic”. The reason or many of the reasons are also the “three noes” status of the industry: no product standards, no quality supervision, no safety assessment.
Evenly, the profit of e-cigarettes still allows everyone to “go to the successor”: According to the “bullet finance” survey, the cost of e-cigarettes of a well-known brand is around 50 yuan to 60 yuan, and the price to channel agents is slightly lower. At 150 yuan, the price that the terminal sells to users is around 300 yuan.
From the perspective of market prospects, according to the China Merchants Research Institute, the number of smokers in China far exceeds that of the United States, but the penetration rate of electronic cigarettes is only about 1%, which is less than 1/12 of the US market. Moreover, in the past six years, the annual growth rate of domestic e-cigarette retail sales has exceeded 25% per year, and the development potential is huge.