Affected by the epidemic, the three red lines, the land focus on the transfer of multiple events, real estate enterprises are more concerned about the first and second tier of this kind of depolymerization of stable cities, but BGY still adhere to the layout of the third and fourth tier, put forward to "achieve a comprehensive coverage of the first to the sixth line of the city," since the listing of the year 2007, to the year 2020, the equity sales amounted to Since its listing in 2007, its equity sales will reach 570.66 billion yuan by 2020, and its equity sales reached 303.09 billion yuan in the first half of 2021, representing a year-on-year growth of 13.5%; and its equity sales area was 34.51 million square meters, representing a year-on-year increase of 8.4%. Beyoncé started from the third and fourth line to climb the ladder, out of its own unique history of growth, this article will analyze the unique features of Beyoncé from the perspective of investment .
01 / Nationalized layout is perfect, risk response ability is excellent
BGI began to implement the national expansion strategy in 2006, the layout of the map extends to Jiangsu, Anhui, Liaoning, Heilongjiang and other provinces, in 2013, officially exceeded the scale of one hundred billion dollars to 2020, the entire Caliber sales scale of up to 788.81 billion yuan, the results will be put forward "to achieve a full coverage of the first to the sixth line of the city".
From the point of view of the distribution of equity land reserves, as of December 2020, Cinnamon's equity land reserves amounted to 275.15 million square meters, land resources are mainly located in Guangdong Province, the equity floor area accounted for about 20%, the distribution of the other provinces is more balanced, which focuses on Jiangsu, Hunan, Henan, Shandong and other provinces, accounted for 7% or more, the national layout is more complete, can effectively diversify the regional market risk.
Combined with the sales situation, from 2018 to January-April 2021, BGG's equity sales scale has expanded year by year, and the compound annual growth rate of sales amount from 2018 to 2020 is 13.7%. The sales share was mainly contributed by the Pearl River Delta and Yangtze River Delta city clusters, with the combined sales amount share of Guangdong, Jiangsu, Zhejiang and Anhui provinces remaining at around 50%, among which the sales amount share of Guangdong Province maintained a year-on-year decline, from 24% in 2018 all the way down to 16% from January-April 2021, while the sales contribution of Jiangsu and Zhejiang Provinces gradually increased to January-April 2021 , with the sales value share reaching 16% and 10% respectively. The area investment and sales ratio is maintained at around 1, with sufficient supply to support sales growth.
Overall, BGI's sales distribution and land reserve distribution is relatively consistent, and in the real estate industry slowdown, three red line forced real estate companies to reduce leverage under multiple pressures, most real estate companies focus on the layout of the Yangtze River Delta, the Pearl River Delta metropolitan area of the core cities in order to obtain a more certain de-emphasis, to ensure a stable cash flow, so as to reduce the investment in marginal cities and low-capacity cities, but the reduction of competitors may not be the same, but it is possible to reduce the competitors, the investment in the city of the edge of the city of the city, the city of the city, the city of the city, the city of the city, the city, the city, the city, the city, the city.
02 / Precise selection of cities, continuous deep plowing, and city-specific strategies to help scale coronation
In most of the real estate enterprises are still in the base camp deep plowing, BGI began to land on the national expansion of the strategy, in 2006 Changsha, BGI Venice City, opened to mark the company's official step forward, and the opening of the city of Changsha. In 2006, the opening of Changsha BGN Venice City marked the company's official step towards the country, and then closely follow the process of China's urbanization, forward-looking focus on the layout of the urban and rural areas around the large urban agglomerations, in the 2014-2016 period to fully enjoy the policy dividends of the shanty reform, absorbing a large number of spillover from the core city of the demand for home purchase, the high-speed expansion of the sales scale. Specifically, the layout characteristics of BGG has three main advantages: First, the selection of cities accurate , although BGG is mainly layout of third and fourth tier cities, but the selection of the city vision unique, stationed in the city most of the population size of more than 500,000 people, the development of the city with better potential; Second, the investment has a continuous , once the selected city , once the city is selected to move in, BGG will have a good understanding of the city, and will not be able to take advantage of it. Second, the investment has continuity , once the selected city to move in, BGI's investment will continue, in-depth layout is conducive to market share and brand effect; Third, the city policy , in the replication of the heterogeneous at the same time to take the differentiation of the investment, more in line with the positioning of the brand to maximize the effect of the play.
First, the forward-looking strategic layout, the selection of the city's unique vision
In the third and fourth tier markets, BGG has an absolute first mover advantage. From the distribution of the new equity investment amount of BGG from 2019 to 2021, more than 50% of the investment amount is distributed in the third and fourth tier cities, the investment amount of the second tier cities accounts for about 40%, and the first tier cities is less than 3%, so it can be said that the reason why BGG is able to realize the performance takeoff, and its strategy of plowing into the third and fourth tier is inseparable.
BGI's investment strategy avoids the first-line, core second-line hot spots, but it is not a "wide-spread net". From the company's main investment in the third and fourth tier cities, can be divided into two categories: First, the Pearl River Delta, Yangtze River Delta city circle surrounding the city , such as Huizhou, Shantou, Xuzhou, Huai'an, Nantong, Jiaxing, Shaoxing, Jinhua, etc., such cities are third and fourth tier, but is located in the core city circle, the level of economic development is higher, the infrastructure is well developed, the population is economically strong, and can effectively support the real estate development of the city, and can be used to support the development of the city. Higher strength, can effectively support the growth of the real estate market; the second category, point-like development, attractive to the surrounding urban population of the city , such as Luoyang, Xuchang, Cangzhou, Linyi, etc., such cities have sufficient population size, inventory depletion scale is more reasonable (within 24 months), 2020 Luoyang commodity residential turnover floor area of 2.83 million square meters, an increase of 8.8%, average price Up 8.8%, the average price of 9,860 yuan / square meter, up 7.6% year-on-year, Luoyang inventory of commercial residential area of 2.93 million square meters, the depreciation cycle of 12.4 months.
China's urbanization process will continue, and the 2021 national government work report states that during the "14th Five-Year Plan" period, it will y promote the new urbanization strategy with people at the core, and increase the urbanization rate of the resident population to 65%. This means that despite the downturn in the real estate industry, the layout of the first and second tier core cities of the real estate enterprises have turned to the layout of the inventory market, to the operation and management of the dividends, but China's urbanization is still in the period of rapid growth, some of the third and fourth tier cities still have a sufficient incremental market, to support BGI's sales scale of sustained and steady growth.
Second, the investment is sustainable, the average market share of the third and fourth tier of 8%
Generally speaking, the first to enter the region or city need to set up a new regional company, through the regional company for the exploration of the new region and deep plowing, in the group of the region have a full understanding of the experience and the scale of regional companies to a certain degree, and then the regional company to a certain extent, and then to the regional company, and then to the regional company, and then to the regional company. After the group has a good understanding and experience of the region and the scale of the regional company to a certain extent, then make a decision to merge or split the regional company, that is, as long as the stationing of a new city, it will inevitably bring about a rise in management costs, marketing costs, so whether it is a nationalized real estate enterprises or regionalized real estate enterprises, the continuous layout of the stationed city is very necessary, short-term layout not only causes the rise in costs, but also is not conducive to the promotion of the brand.
From the point of view of BGI's overall investment strategy, in addition to ensuring that the company's deep plowing efforts in the Yangtze River Delta and Pearl River Delta peripheral cities, to the Bohai Rim, the middle reaches of the Yangtze River, Sichuan and Chongqing and other areas of the comprehensive coverage, and then they will be in-depth layout, and based on the extension of the neighboring pockets of the region (densely populated provinces, such as Henan, Hainan, Guizhou, etc.), the adherence to no more than The principle of "first stabilize, then expand" is adhered to. From the point of view of the 199 cities invested in 2020, 138 of them are consecutively invested in 2019 and 2020, 118 are consecutively invested in 2018 to 2020, and 101 are consecutively invested in 2017 to 2020, that is to say, more than half of Cinnamon Garden's cities have achieved four consecutive years of continuous investment, and the deep plowing intention is obvious.
The most direct result of continuous investment is the increase in market share , as of the end of 2020, BGG*** entered 289 prefecture-level cities in China, and the average market share of the total number of cities in which it was stationed was 5%, of which the average market share of third- and fourth-tier cities was 8%. Among them:
Jinzhou City in Liaoning Province and Luliang City in Shanxi Province have a market share of more than 30%;
Shaoguan City in Guangdong Province and Chaoshan City in Guangdong Province have a market share of 20%-30%;
Lanzhou City in Gansu Province, Suqian City in Jiangsu Province, Qingyuan City in Guangdong Province and 46 other cities have a market share of 10%-20%;
Foshan City in Guangdong Province, Henan Province Zhengzhou City, Henan Province, Nantong City, Jiangsu Province, Jiaxing City, Zhejiang Province, 98 cities with a market share of 5% -10%.
BGG's high market share in the third and fourth tier can bring three advantages to the company: First, the reduction of marketing costs , due to the superposition of the brand effect, the previous properties are advertised for the new launch, you can drive the promotion of the new building with lower marketing costs; Second, the formation of competitors in terms of scale and , three or four lines is different from one or two lines of the market, one or two lines of the market share to enhance the difficulty and risk, more competitors and policy constraints and capital regulation is more stringent, so real estate enterprises in one or two lines of more difficult to maintain a high market share, but three or four lines of the market is different, once the formation of a high market share in three or four lines of the market, will push up the competitor's marketing costs, forcing them to face a higher cost of realization, but also the market is different. The first step is to make sure that you have a good understanding of the local market, so that you can design a more reasonable product that will help your project to succeed.
Third, the local replication and city-specific policy, maximizing the fit to customer demand
In the process of local replication and national layout, BGI formed a clear and effective investment strategy: avoiding the mainstream market customer base and strong competitors, mainly for the suburbs of large cities and the three or four lines of the design of the product, the positioning of products from the initial "price-sensitive" to "price-sensitive", "price-sensitive" and "price-sensitive". The initial "price-sensitive, lower requirements for grade and taste" gradually divided into two categories:
First, the core city's new demand customer base , that is, the lower wealth capacity of the crowd in the big cities, such as graduated 5 years, growing white-collar class, such customers capital accumulation, less, focus on cost-effective, so the customer is not the only one. These customers have less capital accumulation and pay attention to cost-effectiveness, so the average sales price of BGI in this kind of market is lower than the average price of the industry, such as the average selling price of BGI in Shanghai in 2020 was 30,978 RMB/sqm, which is lower than the average sales price of new houses in Shanghai, which is 56,900 RMB/sqm;
Secondly, the middle- and high-end customers in the areas around the core city , that is, the middle- and high-end customers in the areas around the core city or those in the low level of development of the core city.
Secondly, the middle and high-end customer base in the peripheral areas of core cities, i.e. in the big cities or cities with a low level of development, BGI is mainly targeting at people with higher wealth strength. Due to the standardized process of BGI's realization of a single line, coupled with the scale effect, it has a strong price competitiveness in the third and fourth tier markets, and thus the average price of the sale of such markets is usually higher than the average market price. The average sales price of new homes in Langfang in 2020 was RMB22,140 per square meter, higher than the average sales price of new homes in Langfang of RMB14,802 per square meter.
03 / Firm strategy, refusing to follow the hot spot
Since April 2021, 22 cities entered the era of centralized land supply, and as of June, 19 cities such as Beijing, Tianjin, Shenyang, and so on, have successfully completed the first batch of centralized land supply, and the cities are becoming more and more polarized: the popular city plots are obviously looted, and the cold city plots are not so popular. The phenomenon of looting is obvious, and the cold cities are mostly sold at the bottom price. However, as a leading real estate enterprise, BGG, in the first batch of centralized land supply less participation, as of the end of June 2021, BGG, although in Beijing, Shanghai, Guangzhou and other ten centralized land supply cities, but only in Shanghai, Beijing to take the land investment is larger, a total of 13.63 billion yuan, the overall in the centralized land supply of the city's interest in the amount of land acquisition of 18.1 billion yuan, the interest of land acquisition of an area of 18,413,000 square meters, and the 1 January 2021, BGG, in the city of Tianjin, Shenyang and other 19 cities have successfully completed the first batch of centralized land supply. And the cumulative equity land acquisition amount of BGG in January-June 2021 amounted to 80.35 billion yuan, and the equity land acquisition area was 22.613 million square meters, i.e., the proportion of equity investment in centralized land supply cities to the total equity land acquisition amount was 22.5%, and 77.5% of the amount was invested in non-centralized land supply cities, which is mainly due to two reasons: First, BGG firmly "ploughs into three or four lines, and realizes the comprehensive investment of one to six lines", and then invests a large amount of money. Firstly, BGG firmly adheres to the strategy of "deep plowing in three or four lines, and realizing comprehensive coverage of one to six lines", and although there is a certain layout in the core cities, it is not the main investment position, so the willingness to participate in the centralized land supply is low, and the land acquisition in high-level cities is more for the need to replenish the value of the goods; secondly, in the process of BGG's development, it has always maintained the advantage of acquiring land with low cost, and the average cost of acquisition has stabilized below 3,000 yuan The average land acquisition cost is stable at below 3,000 yuan/square meter, and the ratio of land and goods is below 35%, leaving ample profit space, while the competition for most of the land plots in this centralized land supply is more intense, coupled with the rise of all kinds of hidden costs (such as bidding for allocation of talented people's housing, rental housing, and uncompensated handover of the area, etc.), the profit space of the land plots is smaller, which is not in line with Beyoncé's land acquisition strategy.
Epidemic and control policies make most of the real estate enterprises are inclined to go to the high certainty of the first and second tier core cities, for the three or four tier cities with a conservative attitude, but "his arsenic, my honey", this is a boost for BGG: BGG knows the three or four tier market law, the real estate enterprises hastily withdrawn from the time to reduce the pressure of the land auction.
Three and four tier markets with no centralized concessions and no competitors are almost a comfort zone for BGI.
04 / Diversified business to open up the industry chain, helping to further increase market share
In addition to the investment strategy itself, the rapid development of the diversified business lines under the BGI Group has played a role in empowering the real estate industry, typical examples include BGI Robotics, Cinnamon Services and Cinnamon Ventures:
First, Cinnamon's robotics industry . BGG's robotics industry is divided into two categories: 1) Bozhilin Robotics, founded in 2018, is committed to developing systematic system construction in the field of construction, and as of the end of 2020, Bozhilin Robotics has 46 models of construction robots under research, of which four have been rented and sold on the market, and 14 models have entered the project to carry out batch commercialized construction, such as floor cleaning, indoor spraying, and floor tiling,
The standardized construction for enterprises is conducive to standardized construction. strong> For enterprises standardized construction is conducive to accelerating construction efficiency and improving construction quality , and for employees effectively reduces the physical harm of such work; 2) Thousand Seals Robotics, founded in 2019, is committed to the development of diversified food and beverage services, and by the end of 2020 has opened more than 70, *** counting 583 various types of stand-alone equipment put into operation, including five major types of hot pot, boiled rice, fast food, noodle store and Chinese food, the robot restaurant can not only meet the higher requirements for food safety as well as solve the problems of process and efficiency, but also operate under special circumstances, such as in early 2020 when Wuhan was in a serious epidemic, the boiled rice robots donated by Bixi Yuan could realize 24-hour operation and unmanned meal delivery, so that healthcare workers could eat hot meals at any time.
In addition, construction and catering are both population-intensive industries, on the one hand, China has entered an aging society, the sharp decline in the demographic dividend, especially in the construction manufacturing industry, the first-line workers are prone to the situation of a shortage of workers, the machine can replace the manpower to complete some of the cumbersome, repetitive and dangerous work, to solve the problem of "difficult to recruit"; on the other hand, the domestic construction industry is facing a large number of problems, such as the construction of a large number of people in the construction industry. On the other hand, the domestic construction industry is facing the problem of large but not excellent, low degree of information technology and intelligence, and the use of robots can ensure the speed of standardized high-quality work at the same time, prompting the construction industry transformation and upgrading.
Second, BGI services . Due to the advantage of "deep plowing three or four lines, close to the market", as early as May 2018, it followed the national policy of poverty alleviation, and set up the Leading Group of Precision Poverty Alleviation and Rural Revitalization, and at the same time, used the BGG service to further sink, and reached a strategic cooperation with the township government. Xiaogang Village in Fengyang County, Jiangmen City **** and town, Suqian City Xinzhuang Town to reach cooperation, on the one hand, can help villages to establish a long-term development mechanism, the import of corporate advantage resources, such as the construction of intelligent systems; on the other hand BGG Service's presence enhances the Group's brand influence, but also for the Group to land the industrial projects or development projects to lay a solid foundation.
Third, BGI Ventures . Since the establishment of BGV, has invested in 22 projects, mainly divided into hard technology, community ecological chain, new consumption, big health four categories, including fast, shell, Qinhuai data, and platinum medicine are successful IPO, in addition to financial gains, post-investment empowerment is also one of the main considerations of BGV, such as real estate upstream and downstream industry chain enterprises shell, Zhuo Bao Group, Guangxi Mona Lisa, etc., the community service class fast rabbit logistics
Big Cinnamon Ventures invests in these companies not only to dock resources with the group to reach a strategic cooperation, but also to directly land as a part of the property services, and the synergistic development of the main business.
Overall , BGI Group's diversified business and the real estate industry to form a good synergy, robotics to speed up project turnover, reduce employment costs, property services and government cooperation, expanding the brand effect, venture capital investment projects covering the upstream and downstream of the industry, as well as the field of consumption, service, through the whole industry chain, and ultimately serve the main real estate industry. The projects invested by VC cover the upstream and downstream of the industry, as well as the consumer and service sectors, opening up the whole industrial chain, and ultimately serving the main real estate industry and promoting the further increase of market share.
After determining the goal, we should firmly implement it and not change it overnight, and this is even more true for real estate enterprises. After selecting the target market and target customer groups, real estate enterprises should determine the investment strategy accordingly, and make appropriate corrections according to the changes in the policy or industry environment, and implement it firmly, but if the investment strategy of the real estate enterprises changes frequently, the market deep plowing is not in place, and at the same time, the management costs, marketing costs have risen sharply, then it is bound to go not for a long time. Overall, Cinnamon always adhere to the layout of the three or four lines do not waver, continue to plow the investment in the city, to meet customer demand, and ultimately crowned as the king of the three or four lines, while the layout of a number of upstream and downstream markets, through the whole industry chain, the market share will further increase, the so-called "work is only a will, the industry is only hard".