The market share of Chinese hydraulic valve manufacturers depends on price or va

Taking the market share or taking orders, almost a lot of inertial thinking thinks that Chinese hydraulic valve manufacturers rely on price. No wonder, in the Fortune Global 500 list a few days ago, although there are 145 Chinese enterprises, their profits are only half of those of American enterprises.

A few days ago, I saw a short story about Huawei. When meeting Ren Zhengfei, the chairman of a Fortune 500 company said, "How can Huawei succeed in the world by using low-cost tactics?" Ren Zhengfei blurted out: You are wrong. We do not rely on low prices, but on high prices. In the European market, Ericsson has the highest price. The average price of Huawei is 5% lower than Ericsson, but 5% - 8% higher than Alcatel, Lucent, Nokia and Siemens. It seems that when Chinese products sell well in the world, they must think that they occupy the market by low prices. What is the logic?

The essence of business is transaction. Trade, take my value to exchange the other party's value. The reason why the business can grow is that the enterprise has more ability than the things to exchange. If the capacity overflows, it will grow. Why can enterprises grow and make money? Make the products more valuable and produce more products, so we can get more. AAK Hydraulic Valve can make the hydraulic valves more valuable. Perhaps the price is 20% more expensive than that of the peers, but the service life of the hydraulic valves is twice that of the peers. This is the capacity overflow of AAK. I think this is also the direction of Chinese hydraulic valve manufacturers.

Chinese hydraulic valve manufacturers have the ability, then can exchange more thing. Whether the growth is fast or slow depends on whether the enterprise has a good strategy and high production efficiency. However, behind the growth of enterprises is the spillover of endogenous capabilities, and there must be a basic value. The value is that if the company wants to make money, it must take better value to exchange. Only with such values can we adhere to the long-term principle. AAK has been firmly committed to this road since it got the first trial order of HydraForce 10 years ago. The same is true of AAK people. If they want to become business experts, they should work hard on the professional skills of hydraulic valves to become engineers. A real business expert is indispensable for his mental strength, physical strength and intelligence.

If you do one thing and focus on the next 3 years, there will be more peers. If we can focus on the next 7 years, the number of peers will decrease by at least 70%. Because few Chinese hydraulic valve manufacturers are willing to make such long-term plans. Long termists, calm down fluctuations, cross cycles and embrace trends. Long termism, rolling forward, for tomorrow.