cryptogamesfreetoearn| Why is Ao Jiahua's massage chair business not making money in a row?

May 19thCryptogamesfreetoearnBeijing Business Daily reporter learned that ao Jiahua (002614) released the latest investor activity record sheet, in which the interesting question is, how is the research and development of the company's car massage chair? Ao Jiahua said that the project in the early research stage, has not yet signed a specific order, there is greater uncertainty.

It is not difficult to see that some investors are helping ao Jiahua figure out a way out to see if he can get a piece of the hot car track. The performance of Aojiahua, which is famous for its massage chairs, has been somewhat worrying in recent years. From 2022 to the first quarter of this year, the company's revenue declined one after another compared with the same period last year, reaching about 60% in 2022 and 2023 respectively.Cryptogamesfreetoearn.24 billion yuan, 50Cryptogamesfreetoearn0.3 billion yuan, about 1.051 billion yuan in the first quarter of this year, down 11.15% from the same period last year.

Deduction of non-net profit loss

Today, Aojiahua's return to its mother's net profit is positive, and it mainly depends on income outside the main business. in the first quarter of this year, the investment income of Aojiahua's non-recurrent profit and loss project was about 11.05 million yuan, and the total non-recurrent profit and loss was about 14.96 million yuan. the company's first-quarter net profit only reached about 4.997 million yuan. if only deducting non-net profit, Aojiahua actually lost about 9.96 million yuan, which is also its first loss in the past three years.

In people's impression, Rongtai Health (603579) and Aojiahua are both famous for massage chairs, but in terms of performance, Aojiahua lags behind their peers. In 2023, the poor prosperity of the massage chair market is a common problem for the industry. However, Rongtai Health's revenue has returned to the growth track in the first quarter of this year, about 400 million yuan, a slight increase of 3.86% compared with the same period last year, while in terms of net profit Rongtai Health has achieved growth for two consecutive fiscal quarters, about 62.74 million yuan in the first quarter of this year, up 67.31% from the same period last year.

The reason why it is difficult for ao Jiahua to recover has to be found from the business structure. Although the export revenue of both companies exceeds that of domestic sales, Aojiahua accounts for a larger proportion of export sales. According to the data of last year's annual report, its overseas sales revenue was about 3.39 billion yuan, accounting for 68.94% of the total revenue, while Rongtai Health's domestic and export sales last year were about 800 million yuan and 1 billion yuan respectively, which is relatively average.

Because of this, weak overseas demand is a drag on Aojiahua's performance. From the perspective of regional distribution, Aojiahua's products are mainly sold to Europe, North America, Southeast Asia and other places, and hot issues occur frequently in areas where there is insufficient demand, making it difficult for Aojiahua to recover.

As for the situation in the second quarter of this year, O'Jiahua 's reply was vague, saying only that it would "actively respond to the complex market environment and seek breakthroughs" and "strive to bring better returns to investors."

Where is the difficulty of the massage chair?

From the industry's point of view, dependence on overseas is the basic pattern of the massage chair market, which also makes the market situation more difficult to predict than the domestic market, making the production and marketing plans of enterprises more risky.

Liang Zhenpeng, a senior industrial economic observer, told the Beijing Business Daily that although Chinese enterprises account for a large share of the production of massage chairs, from the consumer side, China is a late-developing market. Massage chairs were born in Japan, popular in Japan and South Korea, and then expanded to Southeast Asia, followed by the United States and Europe. The Chinese market gradually made massage chairs popular in the past decade.

Today, in Aojiahua's business plan, overseas markets are still seen as the key to breaking through the difficult situation. Aojiahua said that it will further open up markets in countries and regions along the "Belt and Road Initiative" route. At the same time, it will speed up the layout of cross-border e-commerce channels in Europe, the United States, Southeast Asia and other places, and strive to build new competitive advantages in the field of e-commerce.

Expanding the market will further increase the company's costs, and may also increase the operating pressure on Ojiahua. In fact, with the decline in revenue and profits, we can see that Aojiahua is also reducing its expenses. In 2023, its sales expenses are about 204 million yuan, down 2.47% from the same period last year, and R & D expenses are about 80.18 million yuan, down 9.57% from the same period last year.

Liang Zhenpeng pointed out that for massage chairs, its marketing pressure may be more than itsCryptogamesfreetoearnHis home appliances are larger, first of all, it is not a rigid family demand, and secondly, massage chairs tend to be sold at a higher price, and consumers often need field experience because of a long decision-making cycle. This situation also makes massage chair enterprises have to pay attention to both online and offline channels, mutual drainage, offline there should be a large number of brand experience stores, and need to open in the hot business area, and how much of these inputs can become real revenue, it is often difficult to predict.

Experts believe that the advantage of ao Jiahua lies in its large scale and strong influence. Compared with Rongtai Health's revenue scale of about 2 billion yuan in recent years, O'Jiahua 's revenue scale is as high as 5 billion-6 billion yuan, so there is no need to worry too much in terms of market share. Getting out of trouble still depends on product diversification.

In addition to massage chairs, Aojiahua also has massage appliances and healthy environmental products, and it is healthy environmental products that make Aojiahua's revenue increase rather than decline in 2020 and 2021 during the epidemic, although it is difficult to replicate the strategy in the special situation and special period. but this also gives Aojiahua some inspiration, that is, the company needs to subdivide the layout of the track to more than the main products.

Beijing Business Daily reporter interviewed ao Jiahua on related issues, but there was no reply as of press time.

Beijing Business Daily reporter Tao Feng and Wang Zhu Li

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