E-commerce was the most frequently mentioned word in the Chinese pesticide industry in 2014. The competition in the field may become even more fierce in 2015. While in the vigorous development of e-commerce, there have also been opposing views in the industry: enterprises groan over over-low prices; many dealers do not know what to do with the sudden change and think that the pesticide e-commerce reform will kill them; some think that pesticide e-commerce is just a castle in the air that may not really benefit farmers. Despite those doubts, Wang Xinglin, Deputy General Manager of Jiangsu Huifeng Agrochemical Co., Ltd. pointed out that pesticide e-commerce is the only way in future for pesticide marketing and service innovation and over-interpretation has caused misunderstanding of pesticide e-commerce; dealer channels, which will exist for a long time, will only go through a round of shuffle in the Internet wave, and pesticide e-commerce will definitely bring more benefits to farmers.
Over-interpretation causes misunderstanding
The emergence of pesticide e-commerce has aroused fear in the traditional pesticide sales channels. Many people even believe that e-commerce has made most dealers at a loss as to what to do. Wang Xinglin thinks that e-commerce is just an embodiment of diversification of marketing and service in the pesticide industry and it is impossible to overthrow traditional channels. The pesticide market is very large and requires some personalized sales and service means. E-commerce is a trend. With the development of the Internet technology, online trading will make pesticide purchase even more convenient and more and more people embracing Internet will experience the fast and accurate service brought by e-commerce.
The impact of e-commerce on traditional channels is indeed large. We can see such a reality in the current Chinese pesticide market: the number of dealers is decreasing while the volume of single dealers is gradually increasing. Faced with such selection, only the dealers who are first to embrace Internet can survive in the long run and being the first can give them opportunities to become stronger. Therefore, currently the core issue of pesticide e-commerce is still popularization of Internet knowledge. Bring the awareness of e-commerce of agricultural materials or rural e-commerce to the grassroots.
E-commerce will benefit multiple parties
E-commerce itself is a good thing. The biggest advantage is that it avoids the middle circulation links, which can thus surrender part of the profits to farmers. Only by benefiting farmers and making them have purchasing power can enterprises and terminal market have more profits. Therefore, enabling farmers to know and understand e-commerce has become a primary task of enterprises. In the meantime, enterprises should also join hands with terminal market to guide farmers to experience e-commerce.
Seed, fertilizer and pesticide are three major agricultural consumer goods. Through the traditional “manufacturer-dealer-retailer” sales model, farmers often buy agricultural consumer goods with a much higher price, while dealers and retailers often complain that their profits are too low. In recent years Chinese pesticide enterprises have been exploring the sales models that will benefit farmers and at the same time will not damage end points: on the one hand, reduce channels and cut channel costs, but cutting channel costs is not abandoning channels, and end retailers may be transformed into product experience centers; on the other hand, actively publicize the advantages of e-commerce among farmers. Relatively backward in knowledge, farmers still have doubts of the Internet as a virtual world, while county-level work stations or physical stores can help remove their doubts. Therefore, end retail stores will exist for a very long time.
There are two problems in rural areas in future: buying and selling. We are now exploring the ways of how to solve the problem of buying. E-commerce, purchasing agency, etc. can solve the problem well. We want to adopt those methods in rural areas and guide more farmers to purchase agricultural materials online through some relatively progressive farmers.
E-commerce is not malicious competition
Wang Xinglin says that since the “Nongyiwang” (www.16899.com) founded by enterprises of agricultural materials led by Jiangsu Huifeng Agrochemical Co., Ltd. went online, it has been questioned by many peers and many think “Nongyiwang” is competing viciously, trying to grab attention with low prices.
The most important thing of Internet is speed. As a pioneer in Chinese pesticide e-commerce, faced with great pressure and challenges and the e-commerce blank in the pesticide industry, Nongyiwang has been trying to introduce the advanced e-commerce mode to the industry to form characteristic e-commerce based on the characteristics of pesticide products. However, it is still a long way to go before a complete pesticide e-commerce mode is formed.
The advantage of pesticide e-commerce lies in that it can accelerate capital turnover and reduce risks with the fast speed and gradient trading of the Internet, and it is not purely low price competition of products. On the contrary, pesticide e-commerce can reduce product prices and may even drive the pesticide industry to accelerate innovation in technology, marketing and management and greatly promote the development of the whole industry.
