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On a policy level, the 2018 notice banning the sale of water pipes to minors clearly states that water pipes should not be sold to minors.The new November rules also protect the sale of lookah glass bongs to minors, but do not cover offline controls.How to regulatethe off-line policy in the future is also the most concerned issue for many e-cigarette enterprises.
Zhang dong, an administrative law expert and senior partner at dacheng law firm, had previously told burning finance what policies the country would enact and which categories of water pipes would be the focus of regulation.If you regulate water pipes as a drug, it's too strict.If water pipes are regulated as medical devices, they are not as helpful to quit smoking as advertised, nor are they realistic."Glass pipes are likely to be incorporated into a mature regulatory system for traditional tobacco, and the relevant tax policies will be relatively sound."He said.
"E-cigarette brands want to find a channel online that is both capable and powerful."Strength means whether you have money or not, ability means whether you will invest."In fact, the people who can invest are not rich, the rich do not necessarily have the ability to sell goods, but are playing with resource relations.
One e-cigarette entrepreneur told Burning Finance that the industry's usual practice is to replace e-cigarette packages with cartridges, with the total price of the product being about 60 per cent off from the final retail price, 5.5 per cent to 40 per cent off for lower agents and 7.5 per cent to 20 per cent off for the next agent or distribution price.The discount rate varies according to the agent level.
Different access discount means different gross margin space.Money is deposited throughout the channel system before the product is finally sold in the store.For each additional part of the channel, the amount of money and manpower involved increases by one percentage point.This is the complexity of offline channels.
With the development of domestic tattoo glass bong industry, offline transaction is inevitable.The rapid growth of water pipes over the past two years has been helped in large part by money and the Internet, but it has touched the bottom line for tobacco groups.Offline business is not a day's work.The game between brand and channel will be a long-term topic.
Sun haiming, founder and CEO of platinum e-cigarette, believes that at present, high-quality channels are scarce, and merchants and agents have to rely on them, just like the old scalpers in the market, recycling and education market.On the contrary, it is relatively easy to make money by holding high-quality mobile platforms and channels, rather than squeezing goods, high margins and various subsidies.
Some practitioners joke: "what is the most profitable e-cigarette right now?"Shopping malls make the most money.When it opens a rental shop, brands flock to it, prices start on the floor, and vicious bidding sometimes takes place."There is no doubt that online e-cigarette brands, with their shopping resources, have benefited from the ban.On the day of the ban, some brands simply said "very happy" or "happy.".
The founder of an e-cigarette brand believes the ban will lead to a restructuring of the industry that will spur new opportunities.Our main task now is to grab territory, and the window of time is only one or two months."His reasoning: the brand is just responding to the fact that web traffic has been forced offline, so one thing to do now is to capture web traffic, and the other is to capture new offline channels.
Fulu is testing its direct delivery service in Beijing, an agent told burning finance.The user makes an appointment through a furu employee, and the dispatcher will deliver the product at the specified time.In this way, on the one hand, we can achieve the goal of continuing offline sales, and at the same time, we can identify minors.However, this will increase operating costs compared to selling on e-commerce platforms.
Accelerating store openings has become a common choice for many e-cigarette brands, but there are different ways to open stores.
Zhao yangbo, vice President of capital investment at qichen, said that with the ban on online sales in place, the bongs from china industry will have more collection stores than specialty stores in the future.
In the past, the e-cigarette industry was dominated by specialty stores, with franchisees joining a single brand and the brand independently bearing the costs associated with opening a store.Zhao yangbo believes that there will be such a situation in the future: multiple brands and products will be different, sharing the cost of setting up shop, and the channel side will coexist from a single brand to multiple brands. No matter agents, channel suppliers or users, they will gradually start to choose brands.
The battle for an offline breakthrough in water pipes has officially begun.The success or failure of e-cigarette companies in this early winter will depend as much on the effectiveness of offline breakthroughs as on regulatory attitudes.