Research On Xiaomi's Business Model

With the continuous development of Internet technology and industry,smartphones are playing an increasingly important role in our daily lives,and the industry in which they are located has entered a mature period.At the same time,as people's material conditions improve,people are increasingly pursuing intelligent life.So,the artificial intelligence and Internet of Things industry has gradually risen and grown,and gradually changed people's lifestyle.The Xiaomi Group is a typical representative of this industry.It is an innovative enterprise mainly engaged in smart phones,smart homes and Internet services.Xiaomi started by selling mobile phones using the Internet model,which broke the traditional business model and once set off an unprecedented upsurge in the industry,leading us into a new era of Internet mobile phones.Founded less than 10 years ago,it has become the world's fourth largest mobile phone manufacturer and the world's largest consumer-grade IoT platform.In2017,its revenue exceeded 100 billion yuan,and it has a large number of loyal "rice noodles",growing rapidly.Xiaomi Group was officially listed on the Hong Kong Stock Exchange on July 9,2018.After its official listing,its company's stock was snapped up and sold out,and then the stock price began to rise all the way up to 22 Hong Kong dollars.However,such a magnificent scene did not last long,and Xiaomi's stock price began to continue to decline.As of midday of July 9,2019,Xiaomi's stock price was reported at HK $ 9.37.Xiaomi's repurchase of shares has failed to save the stock price.Until March 2020,Xiaomi's stock price has also hovered between 9-10 Hong Kong dollars,which is more than the issue.Prices have fallen by about 40%.The contrast before and after listing is large.As a typical representative of the industry,the contrast like Xiaomi has also caused the focus of the capital world.Therefore,this paper takes this as the background to study the income and return on investment of Xiaomi group after the operation of Internet business model.After combing and summarizing the relevant literature at home and abroad,we decided to use the Harvard analysis framework,based on the annual report and financialstatements of Xiaomi group from 2015 to 2018,make a comprehensive analysis and evaluation of the company from four aspects of strategy,accounting,finance and prospect,and analyze the current situation of Xiaomi group's income and investment return.After analysis,we can see that Xiaomi's income quality The volume and return on investment are low,and the main reason is that the disadvantages of millet development model are exposed,that is,the pursuit of cost-effective,low profit point;weak liquidity of Internet services;imperfect offline sales channels and less investment in R &D.According to the reasons,the corresponding improvement measures for the company are put forward,that is,to improve the mobile + aiot dual engine strategy,improve profitability,deepen the development of Internet services,enhance the liquidity of Internet services,and at the same time,improve offline sales channels and increase R &D investment.Through the research of this paper,it is concluded that Xiaomi has made quite amazing achievements in the early stage with its business model operation,and its growth rate is very fast.However,in the later stage,its disadvantages are exposed,resulting in the decline of stock price and the evaporation of market value.It can be seen that the current business model of Xiaomi is unable to make the enterprise sustainable development.Finally,it concludes that the most important thing for an enterprise to continue to develop is to have strong profitability and core competitiveness.At the same time,it is hoped that the conclusions of this paper will promote the development of millet in the future.