——The Entrepreneurial Journey of Li Jinhu, XCMG Foundation's Dealer in Yan'an

                                                                     By Zhang Rui 

When people mention Li Jinhu, everyone in Yan'an's rotary drilling rig industry knows the name; his business has flourished over the past two years. Li Jinhu is now the general manager of Yan'an Jinhu Construction Machinery Co., Ltd., whose business scope covers the sale and leasing of XCMG-brand rotary drilling rigs as well as pile foundation engineering construction. Jinhu Construction Machinery currently operates three outlets in Yan'an alone, and its outlet in Suide, Yulin, is about to open.

General Manager Li's office is simply and tastefully furnished. On the wall is a large XCMG logo, beneath which are XCMG's core values: "Shoulder Great Responsibilities, Walk the Great Path, Achieve Great Things." On the desk sit side by side miniature models of a rotary drilling rig and a horizontal directional drilling rig. Riding the tide and singing his song, he realized his entrepreneurial dream with bold vision.

 Entering the Industry  A Bumpy Road

Li Jinhu's father drove a loader in his youth, and influenced by him, Li Jinhu was interested in construction machinery from an early age. By the time he was around twenty, he had begun contracting small construction projects himself. At first, the machinery needed for the projects was all rented; later, after making some money, he kept adding construction machinery, and still later he began renting that machinery out to others, and thus a leasing station came into being. 

Originally, Li Jinhu did construction work to make money, but he later found that labor costs were rising and that such small-scale operations were hard to scale up, while large projects were hard to win. Construction projects basically require advance funding, bank loans were hard to obtain, and funds grew increasingly tight. Eventually he simply could not bear it and decided to change direction. At first, he worked part-time as an agent for a certain brand of tower cranes, but tower cranes have low value, and at the time competing products were highly recognized in northern Shaanxi, so after a year he had almost zero profit. After long thought and research, Li Jinhu decided to give up engineering construction and switch to professional dealership, and to deal in the most profitable products with the best market prospects from a well-known enterprise.

The industry generally recognizes rotary drilling rigs as the best-selling type of construction machinery on the current market; although the unit value is relatively high, the profits are very considerable. Equally important, Yan'an has developed rapidly in recent years, buildings are being built taller and taller, and demand for foundation piling equipment is growing substantially. Moreover, Yan'an lies on the Loess Plateau, with gullies and ravines crisscrossing the area; the government's road construction must cross many areas with great differences in elevation, so bridge construction work will be substantial. Apart from rotary drilling rigs, no other equipment could take their place. For these reasons, Li Jinhu believed that rotary drilling rigs would have a large market in Yan'an.

Joining Hands with XCMG  The Clouds Part

The next question was what kind of partner to choose. Li Jinhu thought hard about it. Through earlier contacts, Li Jinhu believed that a good enterprise must have two qualities: first, safe and reliable products; second, deep cultural foundations and a human touch. Both are indispensable.

A few years ago, Yan'an was still a rather backward place. At that time, the construction machinery they encountered was basically all XCMG—road rollers, loaders, truck cranes, and so on—so choosing XCMG when buying construction machinery was almost a reflex. The advertising slogan "XCMG, XCMG, helps you succeed" was familiar to adults and children alike; many youngsters did not even know what construction machinery was, but they all knew that slogan. At that time, many of them even felt that construction machinery should be yellow, and other colors were hard to accept, so the XCMG brand subtly took root in their hearts.

He also greatly approves of XCMG's culture. He feels that cooperating with XCMG is like cooperating with brothers, full of human warmth. At the dealer conference, President Kong repeatedly stressed: they are brothers! We northern Shaanxi people are straightforward and have no tricks up our sleeves; when doing business with southerners, our biggest worry is being played. Cooperating with a boss like President Kong and a company like XCMG, he feels at ease! We Chinese often say: when brothers are of one mind, their strength can cut through metal. Understanding the company and identifying with its leaders has also filled him with confidence in the future.

Sincere Cooperation  A Dream Comes True

Over the years since starting his business, Li Jinhu has realized that to achieve substantial development, in addition to learning the lessons from his failed tower crane agency, he must strengthen and consolidate XCMG drilling rigs' position in the Yan'an market. This is not just empty talk: from the time he became an XCMG Foundation dealer until now, XCMG rotary drilling rigs in the Yan'an market have gone from nothing to ranking among the top three in the industry. Next, their goal is to be number one in the industry. The foundation company's annual targets increase by 15 percent each year, so dealers naturally have to bear heavier quotas. General Manager Li said that to foster the development of their dealers, the company has introduced some very good policies. For example, in the crucial areas of service and spare parts, the company has excellent policies, and its support for spare parts in after-sales service is strong. They must do even better in after-sales service so that every customer becomes a loyal customer; a customer's first purchase will definitely not be the last. Playing the "service card" well together with the foundation company this year is the most critical step for Yan'an Jinhu to establish itself in the northern Shaanxi market.

Speaking of future development plans, General Manager Li's voice is deep and resounding. This northern Shaanxi man's dark face spreads into a smile like a flower—the joy that belongs only to successful people. Undoubtedly, cooperation with XCMG has filled him with confidence in future success! Choosing XCMG was his most successful choice!

    Editor: Wu Yue