I don’t know if you have noticed that more than ten years ago, the products in the stationery shop were still divided into two parts, half real color and half morning light. Now, stationery stores rarely see real color products again.
Looking at the recent situation of Chenguang, we can get a glimpse from the latest financial report.
8 times growth of “small track”
On October 27, Chenguang stationery released the third quarter report of 2020.
According to the report, the company achieved 8.538 billion yuan of operating revenue in the first three quarters, with a year-on-year growth of 7.43%, and a net profit of 913 million yuan, a year-on-year increase of 13.85%.
In the past eight years, the overall revenue growth of Chenguang stationery has been maintained above 22%, which is no less than that of Maotai and Haitian; in terms of net profit, it has increased from 129 million yuan in 2011 to 1.06 billion yuan in 2019, an increase of more than 8 times.
Stationery is an industry that can make money stably through the economic cycle: the demand elasticity is small, the industry periodicity is weak, and the fluctuation of enterprise development is small.
As a leader in the industry, Chenguang naturally receives more attention. Since listing, it has risen from the lowest 7.7 yuan to the highest 83.27 yuan in five and a half years.
However, we can see that the growth rate of stationery market is slowing down.
With the change of domestic population structure, the decline of birth rate, and the gradual promotion of network and paperless office teaching, the contribution of stationery industry relying on quantity growth is weakened, and more growth comes from consumption upgrading and product upgrading.
However, China’s per capita stationery consumption is only 105 yuan / year, which is more than double the global average consumption level of 240 yuan / year. If the per capita consumption is doubled, the stationery market size is expected to exceed 300 billion yuan in the future.
In addition, the concentration of China’s stationery industry is still very low. There are more than 8000 stationery enterprises in China, and only 5 enterprises with sales of more than 1 billion are Chenguang stationery, deli group, Qixin group, Guangbo shares and true color stationery.
Among them, the largest company, Chenguang stationery market share is only 7.3%, and the top five companies only account for 17%.
Compared with the 67% Cr5 market share of the stationery industry in the United States and 62.5% in the Japanese stationery industry, there is still more than three times the gap between the domestic leading enterprises, and there is still room for the growth of head enterprises.
Bottleneck and struggle
At the beginning of 2008, Chenguang was just a manufacturer selling refills. When the business reached a certain scale, it naturally faced the bottleneck of development, and its revenue has been unable to go up.
After inspecting a large number of markets, the chairman of the board decided to replace new signboards for the shops around the school free of charge. Each signboard cost at least 3000 yuan, which was also a big expense at that time. Of course, the premise was that the store could only sell the pen of morning light in the future.
The shop owner thought, in any case, a brand new white, sell whose pen is not sold?
As a result, Chenguang began to seize the market crazily. Later, Chenguang replaced the shelves of stores for free, on the condition of increasing sales categories, such as schoolbags, book clips, notebooks, stickers, toys, and so on. In this way, Chenguang transformed from a company that only sold pencil refills into a company of stationery categories, with explosive growth in revenue.
Up to now, Chenguang stationery has been involved in seven major businesses, including fine cultural and creative products, children’s fine arts, office stationery, popular stationery, krip, retail stores, and Chenguang technology. It has 36 first-class partners, second-class and third-class partners in nearly 1200 cities in China, and has more than 85000 retail terminals.
By the end of 2019, the number of terminal stores covered by morninglight reached 85000, an increase of 11.84% over the same period of the previous year, and the campus coverage rate exceeded 80%.
Among the 180000 stationery retail terminals in China, there are about 4 stationery retail terminals in Chenguang for every 10 school side stationery stores.