The first quarter of the year saw a huge profit of 3.6 billion yuan, and the grassroots founder became a billionaire

In the golden autumn of October, the big sales are approaching, and it is time for cross-border sellers to disclose their third quarter results.

Recently, Huakai Yibai and Jiuan Medical have successively announced their third-quarter performance forecasts. In the first three quarters of this year, Huakai Yibai is expected to achieve a net profit of 136 million to 159 million yuan, successfully turning losses into profits compared with the same period last year; Jiuan Medical's net profit is about 16 billion to 16.3 billion yuan, a year-on-year increase of 31818.29% to 32416.76%.

It can be seen that Jiuan Medical has continued its explosive growth momentum, and Huakai Yibai has swept away the haze and made rapid progress after acquiring Yibai Network, and both have achieved very impressive performance results. In addition, another tool-type big seller, Superstar Technology, officially released its third-quarter financial report, and the result of a quarterly profit of 3.6 billion is astonishing.

In the "2022 Hurun Global Rich List", Qiu Jianping and Wang Lingling ranked 1083rd with a net worth of 21 billion. Qiu Jianping, who came from a grassroots background, seized the opportunity of tool export to make money and embarked on a road to counterattack. After the Giant Star Technology he founded broke the 10 billion revenue mark for the first time last year, its performance this year is still maintaining a strong momentum.

Recently, Hangzhou Dama Giant Star Technology released its third quarter performance report. In the third quarter, Giant Star Technology achieved revenue of 3.601 billion, a year-on-year increase of 28.06%; net profit attributable to shareholders of listed companies was about 622 million, up 9.76% from the same period last year.

▲ The picture comes from Giant Star Technology’s financial report

It is learned that in 2021 and the first half of this year, Giant Star Technology achieved operating income of 10.92 billion and 6.234 billion respectively. This means that in the first three quarters of this year, it has almost completed last year's full-year target, and its performance trend is stable and improving.

It is worth noting that while Giant Star Technology has achieved huge revenue, it has not suffered from the common problem of profit plunge. Its Q3 profit margin is as high as 17.25%, which is higher than the industry average.

Since the beginning of this year, the overseas disease of rising costs and drastically reduced orders has besieged many cross-border enterprises, even the leading benchmarks are not immune. However, Giant Star Technology has broken through this adversity and sought change, relying on three major strategies to grow against the trend and maintain the 10 billion mark against the trend.

1. Emphasis on R&D and focus on innovation

As a tool seller, Giant Star Technology's main products include hand tools and storage cabinets, power tools and laser measuring instruments, with the European and American markets as its main sales base. In order to maintain its competitiveness, Giant Star Technology has launched new products to develop its power tool product line, break through the home energy storage business, and successfully extend its tentacles into the field of non-tool consumer products.

In the first half of this year, Giant Star Technology invested 150 million yuan in research and development, designed 1,058 new products, and applied for and obtained more than 300 patents. Among them, relying on the large-scale innovation of lithium battery power tools, it obtained an order for 12-volt power tools from a large American retail company.

2. Build and consolidate the supply chain to protect production capacity supply

After decades of hard work, Giant Star Technology has established a global supply chain management system with China as its core. It has 21 production and manufacturing bases around the world and has established cooperation with thousands of suppliers around the world to ensure unrestricted production capacity, rapid response to market demand and timely delivery of various large orders.

3. Deepen brand development and build competitive barriers

In order to build a strong competitive barrier, Giant Star Technology has long been committed to the creation and development of its own brands, and has vigorously developed free brands such as WORKPRO, DURATECH, SWISSTECH, and Prexiso. In the first half of this year, Giant Star Technology's free brand sales revenue increased significantly year-on-year, and its revenue share exceeded 39% for the first time.

Relying on these three strategies, Giant Star Technology has become a multi-billion dollar giant in the tool category.

While major sellers in the industry have released their third-quarter financial reports one after another, another leading seller, Lejia Holdings, has also been making big moves recently.

At the beginning of this year, LEGO announced that it would invest RMB 200 million in shipbuilding and had signed a contract with a first-class domestic shipyard to build a 1,800TEU container ship. In an environment of soaring freight rates and slow logistics, LEGO's bold shipbuilding plan made many sellers sigh.

However, just recently, Lechuang once again spent money to buy land in the United States. According to the announcement released by Lechuang, the land it purchased in Patterson, County of Stanislaus, State of CA, APN 021-025-028 has been delivered, with an area of ​​about 59.88 acres, and the full transaction amount of 128 million yuan has been paid.

  ▲ The picture comes from the financial report of Lechuang Holdings

In fact, at the end of last month, Leckey announced that its subsidiary would sell some of its overseas warehouses in California and use the proceeds from the sale to lease, purchase or build larger overseas warehouses. After the transaction is completed, it will also provide sufficient cash flow support for Leckey's subsequent construction of overseas warehousing and logistics systems.

Looking back on 2020, during a video conference with the CEO of Lechuang, the Prime Minister expressed affirmation and support for Lechuang's development path of building a new overseas warehouse platform and expanding new cross-border e-commerce export paths.

This 5-minute call also gave Lechuang the confidence to build overseas warehouses. As of June 2022, in addition to the overseas warehouses purchased and leased in the core hub port areas of the United States, Lechuang also has overseas warehouses in Germany, Japan and other places, with a total of 15 warehouses worldwide. In the first half of the year, the overseas warehouse business achieved a total revenue of 258 million yuan.

Throughout 2022, the global shipping congestion and high freight rates have not been fundamentally resolved, and Amazon FBA warehouses are often overwhelmed, causing logistics delays. Therefore, for cross-border shipping, logistics is always a pain point.

While Legg has invested heavily in shipbuilding and warehouse building, the huge expense support may burden the company's performance in the short term, but in the long run, a solid warehousing and supply chain system is the cornerstone for cross-border companies to form long-term competitiveness. It will not only help Legg to strengthen its logistics fulfillment capabilities, but also help save freight costs and obtain profits by leasing to peers.

As cross-border e-commerce enters the second half, deepening branding and building a supply chain moat have become the main themes. Big sellers are competing in the front, and for small and medium-sized sellers, how to build core competitiveness and gain a foothold in the unpredictable cross-border battlefield is a proposition that should be pondered at present.