[China Agricultural Machinery Industry News] Not long ago, Netafim, the leading water-saving irrigation company in Israel, invested in Ningxia to build a factory. Almost all the equipment was produced in Ningxia factory, but the dripper was shipped from Israel. Why is a small plastic dripper? Want to be shipped from a distant Israeli company?
In the Laiwu City, where the water-saving irrigation industry accounts for 30% of the national market share, when local water-saving irrigation enterprises divide profits in terms of cost, Israeli companies have technically earned more than selling products. The gap is worth pondering.
The technology development is weak behind the small irrigation dripper
Netafim Legend: Business Model Innovation stems from technological breakthroughs
Water saving 35%-50%, fertilizer 30%-40%, reducing labor costs while increasing production by 20%, can also reduce pests and diseases. These eye-catching data is the performance of a drip irrigation system. Water-saving irrigation measures such as drip irrigation and sprinkler irrigation have become important measures for agricultural modernization in countries around the world. In China, the recent water-saving irrigation industry policies are frequent. Some analysts predict that from 2015 to 2020, China's water-saving irrigation industry such as drip irrigation, sprinkler irrigation and low-pressure pipe irrigation will generate 350 billion market space.
The reality is that Israel has an advantage in the global water-saving irrigation industry, and half of the global low-pressure irrigation systems use Israeli irrigation systems. In China, the water-saving irrigation market is almost entirely occupied by Israel.
Jinyuda Water Saving Irrigation Co., Ltd. is a large water-saving irrigation equipment manufacturer in Laiwu City with annual sales of more than 30 million. The company has signed a cooperation agreement with Israel. The Israeli side provides key components for water-saving irrigation filtration and fertilization systems. Jin Yuda conducts overall production and jointly develops the domestic market. At present, the profit margin of Jinyuda water-saving irrigation system is 5%-10%.
Huang Jiabao is the general manager of Jin Yuda. He still remembers the shock he felt when he visited Israel in 2014. In Israel, even those very powerful companies seem to have a simple appearance and no high-rise buildings. However, the factory is highly automated, and only a few workers on the production line walk around to deal with some unexpected situations.
The high degree of automation in production and testing gives Israel a high-precision product. The heads of several water-saving irrigation equipment companies in Laiwu told Qilu Evening News that Qi Luzheng reporters that China's drip irrigation equipment market is almost monopolized by Israeli companies. This is due to the technical advantages of Israeli companies in soil environment sensors and remote control. On the one hand, it is based on the high precision and high standards of Israeli products.
Take Netafim as an example. Netafim has more than a third of the global market for drip irrigation equipment. In the 1990s, Netafim invented modern electronic control products, including complex sensor assemblies that can be adjusted for water spray based on water content, salinity, fertility, and meteorological data. Such a drip irrigation system can increase food production by 300%-500%. To this end, Netafim has also innovated its business model by first installing equipment for users, and then gaining revenue directly linked to grain production after harvesting.
Industry Support: Million Dollars Mold Forging High Precision
Not only water-saving irrigation equipment, but also the degree of industrial modernization in Israel and even in Europe and the United States. Some molds Israel have insufficient processing capacity and will go to Italy and other European countries for processing.
"We still control people's products in many aspects. To improve accuracy, it should be people's control equipment and equipment control products. This is automation." Huang Jiabao said.
But the increase in automation is not an easy task for a private company. Huang Jiabao said that local companies also want to improve the accuracy and automation of products, but behind this is the supporting capacity of the entire industry chain such as molds and production equipment. Compared with developed countries, the supporting equipment and molds of the domestic drip irrigation industry are far from the foreign countries.
Huang Jiabao once inspected, counting logistics costs and tariffs, and buying a set of high-precision molds from Israel worth millions of dollars, while domestic similar mold prices are generally tens of thousands of dollars. Even if you spend huge sums of money to buy high-precision molds from abroad, the level of domestic processing machinery can't keep up, and you can't produce high-precision products.
At the beginning of 2000, Huang Jiabao’s business had just started, and survival at this time was a top priority. At that time, he chose to process the mold in Zhangqiu. This type of mold processing process is rough, but at a low price. Now, the company has a certain strength, Huang Jiabao chose to go to Ningbo, Wuqiao, Yuyao, Dongguan and other southern areas for processing. The molds produced in the above areas are fine, but the price is more expensive.
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