technology going abroad | li tong, ceo of qinglang, who sent robots to work overseas: there is not a lot of gold overseas
2024-08-31
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the core of going overseas is localization. our current strategy is called "one country, one policy". many countries in many regions are not interconnected like china's single large market. each country needs its own strategy, independent market plan and transaction system to cope with the market demands that are not interconnected.
although the middle east seems to be a market full of gold, it is actually full of challenges. especially as more and more chinese companies enter the middle east market, competition has become more intense.
“going overseas is actually an amplifier, which can amplify both success and failure.”
amid fierce competition in the global service robot market, commercial service robots launched by shanghai qinglang intelligent technology co., ltd. (hereinafter referred to as "qinglang intelligent") have gradually gained a foothold in overseas markets. the company began to expand overseas markets in 2020 and established an international business department in 2022. today, qinglang intelligent service robots are available in more than 60 countries around the world, and overseas revenue accounts for more than 50% of the company's total revenue.
li tong, founder and ceo of qinglang intelligence, photo provided by the interviewee.
recently, li tong, founder and ceo of qinglang intelligence, told the paper (www.thepaper.cn) about his overseas expansion story. he admitted that overseas markets are not all gold mines. the domestic market is very competitive, but overseas market competition is also very cruel. "if you can make money, you can make more by going overseas; but if you lose money, you may lose more by going overseas." in li tong's opinion, choosing a small-scale, targeted market for trial is a better choice for companies that are just beginning to explore the path of going overseas.
the following is li tong’s account:
“market education is the biggest cost in the early stages”
the paper: why choose to go overseas?
li tong:going overseas has become a must for chinese robot companies, and it is also a must for us. we have been going overseas for three or four years. it is both an active choice and a passive one. the active reason is that our vision is to change the way people live, and at the same time, going overseas successfully can also bring higher gross profits; the passive reason is that we have received more and more overseas customers consulting about robot business due to the serious shortage of manpower, which has accelerated our pace of going overseas.
the paper: what was the service robot market like in the early days of going overseas?
li tong:we spent more than three years in the early days of our business trying all the sub-segments of the entire robotics industry, and finally chose to make service robots. initially, we thought that the demand for industrial robots was large, but later we found that it was difficult for chinese companies to take the lead in the field of industrial robots. it was easy for them to become followers rather than technology leaders.
but in terms of service robots, we are on the same starting line as other countries. before 2015, there was no service robot industry in the market, so we had to open up the entire market. in the early days, the market had no idea about service robots. for example, in the domestic catering industry, they didn’t know the connection between catering and robots. why do restaurants use robots?market education is the biggest cost in the early stages.
the paper: what are the advantages of going overseas compared to domestic markets?
li tong:china has always been a very important market. over the past thirty years, the growth rate of labor costs has been very fast, resulting in a sharp increase in the demand for robots. however, from the perspective of project development, the service cost of labor in foreign markets is more expensive. for example, services in japan, europe and the united states are basically hourly wages, and the demand for robots to replace labor is higher. i often joke that we are not a robot company, we are a labor outsourcing company. sending robots to work in places where labor is more expensive allows us to obtain higher profits.
china has a vast number of service application scenarios, smart manufacturing industry clusters, large-scale manufacturing plants, key components and supply chain centers, and has obvious advantages in r&d and production costs. from the perspective of service robots, china's commercial service robots are in a leading position in the global track. china is promoting industrial upgrading, and the country's emphasis on new quality productivity has given us more advantages in this track. the combination of software and hardware is more in line with market demand.
“the key to going overseas is localization”
the paper: what are your core advantages?
li tong:in the past, china’s product strength was about 80% of local products, while the price was 50%. now in the field of service robots, china’s product strength can reach 150% while the price is only 80%. china’s advantages in the global supply chain are also very obvious, especially in the globalization stage of service robots.
in addition, the core of the robot is the algorithm, and the algorithm needs running data. we have a huge number of scenarios, and these robots running every day constantly generate new data, which will make the algorithm more refined and the product more stable.
the paper: what are the differences in demand for your products in different countries?
li tong:the terminal price of our products is generally half or even one-third of the local labor cost. overseas market services also provide leasing services. we provide them with equipment and services. compared with other markets, robots are essentially cost-effective and can help them reduce costs and increase efficiency.
different countries have different demands for products. for example, japan has smaller stores, so the robot design is more compact; germany has higher requirements for liquid vibration due to its beer culture. the overall core functions are the same, but local adjustments have been made in the details.
the paper: have you considered establishing a headquarters overseas?
li tong:we will consider it. last year, our growth rate in japan reached 240%. initially, our market strategy was to expand across the board, but later we gradually focused on areas with higher labor costs. we have wholly-owned companies in los angeles, germany, tokyo, seoul, and dubai, and we have implemented data nodes, business, operation services, supply chains, etc. in the local area.
the core of going overseas is localization. our current strategy is called "one country, one policy". many countries in many regions are not interconnected like china's single large market. each country needs its own strategy, independent market plan and trading system to cope with the needs of non-interconnected markets.
“in addition to financial support, personal connections are very important”
the paper: what challenges do you face when going overseas?
li tong:we spent a lot of effort on product certification. we have obtained relevant intellectual property certification in more than 60 countries. because our products are new, there is no unified standard in the industry. we even participated in the establishment of industry standards. new markets have detailed requirements in terms of safety and other aspects. we spent a lot of money and time to comply with regulations.
the paper: some companies that have gone overseas are also suffering losses. what do you think is the reason?
li tong:the reason why many companies suffer losses is the high cost of market education, rather than the time they enter the market.
in the early stages, market education is very expensive and requires constant persuasion. as market penetration increases, sales costs will decrease. our overseas market is still in its early stages and market education is needed, which is when money needs to be spent.
the paper: after you go overseas, will you feel any pressure in the process of scaling your products?
li tong:scaling is not a problem, the key lies in resource allocation and market expansion. we achieve scale through building trust and expanding the market locally, but the result of resource integration. "live by the mountain and eat by the mountain; live by the water and eat by the water" is one of our strategies, such as jointly developing the market with local distributors, relying on influential shareholders overseas to help us build trust in the local market and introduce important partners.
we have been focusing on this industry for more than ten years. it seems that the threshold of the robotics industry is not high, but it is not easy to really make products that meet market demand. this is not a fashionable industry, and it is not possible to see results in a short period of time. it requires a long period of technology accumulation and industrialization process. technological innovation takes time, and it is not realistic to scale up and form an industrial chain immediately.
“middle eastern investors are overwhelmed by the choice of projects, and it is difficult to attract them”
the paper: what failures have you experienced when going overseas?
li tong:we were one of the first companies to enter the middle east market before it became a popular destination for overseas expansion. at that time, chinese companies were not their main partners. we believed that the market opportunities were good and we did receive good financial support. the middle east is more willing to invest in innovative and revolutionary projects.
although the middle east seems to be a market "full of gold" with huge market opportunities, it still needs to be combined with local economic and cultural characteristics.for example, at the beginning, we tried to promote labor-replacing robots there, but found that it didn't work. although there is a lot of money there, a large number of workers come from other neighboring countries, and the overall cost is still more cost-effective than using robots, so the idea of labor replacement is wrong.
it has become very difficult to go to the middle east to seize similar opportunities nowadays. the window period for the middle east market has passed, and it is now much more difficult to attract middle eastern investors than before.
the paper: what suggestions do you have for other technology or robotics companies to expand overseas?
li tong:going overseas requires doing what you can do. competition is very fierce and the challenges are too numerous to count. going overseas is actually an amplifier that can amplify both success and failure. if you can make money, you can make more by going overseas; but if you lose money, you may also lose more by going overseas. therefore, we choose small-scale, targeted markets to try when going overseas. in general, it is a general trend for technology to go overseas, but we cannot expand blindly.
we started making robots more than a decade ago, and almost no one believed we could make them. early market education was very difficult. whether at home or abroad, we need to constantly prove the reliability of chinese products. for example, in the japanese market, even with the support of our shareholders, it still took us several years to open up the market. these are all extremely challenging processes, especially to get a conservative market like japan to accept our products.
the paper: what will be your future technological direction?
li tong:we are developing more intelligent and multifunctional embodied service robot products, not only limited to delivery robots, but also special robots for cleaning, disinfection, etc. in the future, we will find a balance between versatility and specialization to promote the popularization of products in different scenarios.
the requirements for scenarios and data in technology iteration are very high, which is a relatively big challenge. taking embodied intelligence as an example, its ultimate task is the application and promotion of products. our current strategy is to test and promote it in commercial scenarios first, and then gradually expand it to more scenarios. just like the popularization of personal computers, it was initially used in business from mainframes, and then gradually entered the mass market. the direction of our product iteration includes not only the further application of ai technology, but also how to quickly replicate and promote these service-oriented products to more application scenarios.
the paper reporter yu yan and intern wang chun
(this article is from the paper. for more original information, please download the "the paper" app)
