44-year-old Ren Zhengfei collaborated with five like-minded middle-aged people at the end of 1987, and six people divided shares equally for a total of 21,000 yuan. Shenzhen Huawei Technology Co., Ltd. was established in a residential building among the weed piles in Nanyou New Village. At that time, renting office buildings was at least several thousand yuan a month, while residential buildings were up to three or four hundred yuan. The difficulties and hardships in the early stages of entrepreneurship can be seen (see Figure 1-1). The real problem facing Ren Zhengfei, who started his business, is how the company survives. Huawei is now his child and he must let it survive. Although Huawei is called a technology company, it started with trade and had no direction. It is said that Huawei even sold weight loss pills when it was first started. Once, I heard that the business of selling tombstones in Shenzhen was very popular and making money quickly. Ren Zhengfei also sent someone to investigate. But weight loss pills and tombstones are not long-term careers; Ren Zhengfei tried all kinds of techniques and racked his brains in order to make Huawei survive.
Starting a business has never been a romantic thing. Ren Zhengfei passed through middle age and experienced the transformation from a cadre in a state-owned enterprise to a leader of a private enterprise, and his life was full of ups and downs; Huawei also had speculation and confusion in the early days. Ren Zhengfei, who is in his 40s, is like every ordinary person who is unemployed and frustrated in the middle-aged man, floating in the vast crowd; Huawei at the beginning is even a "small shop" that can make money and survive. By chance, Ren Zhengfei, through the introduction of a director of the Liaoning Provincial Agricultural Dialect Department, began to represent the switch products of Hongnian Hong Kong Company (i.e., a small switch that transfers to the extension in the unit), which was considered to be on the road of selling communication equipment .
It was an era when installing a phone call requires gifts, leaving relationships and having to queue up for special approval. As long as agents can get small user switches in Hong Kong, they can make a profit of 100% if they sell them to the mainland. It is precisely because of this kind of agency business with a little "buy and resell" color and the huge demand for telephone communications from the people across the country at that time that Huawei accumulated millions of yuan in just three or four years and established nearly ten sales offices across the country. Huawei started from the rural gap market and used the price difference to obtain the original capital accumulation (see Figure 1-2).
Figure 1-2HAX-100 switch
Ren Zhengfei was the deputy director of the Military Research Institute and was at the level of a deputy regiment. After founding Huawei, this middle-aged man in his 40s personally did marketing and sales. Think about it, it is difficult for such a person to go to remote post and telecommunications bureaus in various places to bend down and say good things to customers and flatter them. Without a true nature of a real man, it is difficult to persevere. Ren Zhengfei's ability to survive from the difficult environment in the early stages of his business was due to his tenacious character given by his poor background and hard military career.
entered 1989. Due to the hot market for user small switches, more than 200 state-owned units across the country entered the production and sales of user small switches. The state restricted credit and controlled the import of equipment, and Huawei's agency business came to an end. This should be the fate of being an agent. Being an agent will inevitably encounter various restrictions on import and export policies and various risks from the original factory. At that time, the market for unit user machines (small switchboards) was in short supply. A 500-door user machine was opened, and local provincial leaders had to go to the site to cut the ribbon. To order, the unit user needs to deposit a deposit of Huawei at least six months in advance, and Huawei will then deposit a deposit of Hong Kong's original manufacturer. However, due to the insufficient supply of products, the original manufacturers in Hong Kong often cannot ship them; there is a problem with the product and cannot be repaired in time; they are not provided to agents in terms of spare boards and spare parts, which makes Huawei very passive when serving customers. Ren Zhengfei realized that without his own products and independent research and development, the so-called providing high-quality services to customers is empty talk. At that time, Ren Zhengfei was deeply suffering from the pain of products, customers, orders, the company's cash flow , and the company's destiny were stuck in the hands of others.
What is placed in front of Huawei is the extreme scarcity of switches and the gap between domestic equipment providers.For agents whose capital chain is on the verge of breaking due to the shrinking of national credit policies, they naturally do not have the courage to take more capital risks to develop switches on their own. In addition to Huawei, Lenovo also started with the "trade" path. The difference is that after Huawei has made initial accumulation as an agent, it quickly moved towards the path of independent research and development and independent production.
began to develop independently from low-end product assembly. Ren Zhengfei spent a year studying law and learning what market economy is. He realized that the operation mechanism of the market has two important things for enterprises: one is the customer and the other is the source of goods. Among these two elements, customers are uncontrollable, and the only thing that the company may control is the source of goods. In 1989, Ren Zhengfei, who knew that being an agent could not last long, began to decide to move towards independent research and development. Although
has begun its own research and development path, Huawei has not given up on the switches that represent Hongnian Company in Hong Kong. With Huawei's technical strength at that time, it could only develop user switches of up to 24 doors, while Hongnian Hong Kong could have one switch with 200 doors and 500 doors. In the market, the supply was in short supply, and the deposit and reservations had to be paid six months in advance. Huawei has been walking on both legs with "agent + independent research and development" for several years, and "survival first" has always been the main line in Ren Zhengfei's mind.
Huawei, which started in 1988, established a sales network across the country by agents of foreign products, gained a foothold in the unit user market, and then achieved a one-stop R&D, production and sales through independent research and development and production. In 1992, Huawei's sales exceeded 100 million yuan for the first time.
Huawei Company is Ren Zhengfei's choice when he is desperate; Huawei's independent research and development is a necessary requirement for Huawei to survive. In the early days of Huawei, stories of fighting for "living" and survival may not be glorious, but they are a true portrayal of the time. In the early 1990s, under the Huawei platform operated by Ren Zhengfei, he began to write an extremely fresh and unique R&D symphony.
2020 top 500 private enterprises in China Huawei Investment Holdings Co., Ltd. ranked first. On August 12, 2022, Huawei released its first half operating performance report showing that Huawei achieved sales revenue of 301.6 billion yuan.
Note: Refer to "Huawei R&D (3rd Edition)"
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-