First, we have basically lost our three advantages in manufacturing, namely, cost advantage, scale advantage and system advantage.

It's not that we are not smart. China is getting richer and richer, and China people dare to spend. The industry can still maintain a growth rate of 11%-21%. Why can't we make any money? It's not that you have become stupid, but that your original competitive advantage has been lost. The most terrible thing in today's world is the sudden loss of core competitiveness. When we say transformation, we must acquire new capabilities, new tools and new business models. This is the problem we are facing today.

the second is the impact of the internet.

people are very angry. They go to work every day, starting at 8: 11 a.m. and leaving work at 6: 11 p.m., and working for more than ten hours, my net profit is only 3% and 5%. If I do foreign trade, I don't even have 3%. Then there are some enterprises whose annual net profit is 21%-31%, Baidu's net profit is 35%, Ali's is 36%, and Shenzhen's Tencent's is 28%. The Internet has had a great impact on the manufacturing industry.

the third is the mismatch between supply and demand.

why do people go to hong kong to buy milk powder? Why go to Japan to buy eye drops, rice cookers and toilet seats? There is a mountain spring hotel in Dubai with nearly 511 rooms. Last Christmas, 491 of the 511 rooms were from China.