Haier Smart Home Co., Ltd. (formerly Qingdao Haier Co. Ltd.) history, profile and corporate video
Haier Smart Home Co., Ltd. (formerly Qingdao Haier Co. Ltd.) is a household electrical appliances manufacturer and distributor. The company is engaged in manufacturing air conditioners, refrigerators, freezers, and other household appliances. Its operations are carried through the following business units: white goods, brown goods, client solution business, and equipment components manufacturing group, retailing and finance. White goods include refrigerators, air-conditioners, washing machines, water heaters and kitchen appliances. Brown goods include color TV, mobile phone and computer. Client solution business provides central air-conditioner, integrated kitchen, interior decoration, medical equipment and intelligent home appliances. Equipment components manufacturing group provides plastic & metal plate production line, material integration production line and electric control integration. Retailing involves in operating branded stores, franchises and village-level chain stores. The group is also into the finance and real estate businesses. The company was founded on December 26, 1984 and is headquartered in Shandong, China.“
“Qingdao Haier History
The origins of Haier date back long before the actual founding of the company. In the 1920s, a refrigerator factory was built inQingdao to supply the Chinese market. After the 1949 establishment of the People’s Republic of China, this factory was then taken over and turned into a state-owned enterprise.
Founding a new company
Haier had been founded as Qingdao Refrigerator Co. in 1984. With China opening up to world markets, foreign corporations began searching for partnerships in China. One of these, Germany’s refrigerator company Liebherr entered into a joint-venture contract with Qingdao Refrigerator Co., offering technology and equipment to its Chinese counterpart. Refrigerators were to be manufactured under the name of Qindao-Liebherr (simplified Chinese: 琴岛—利勃海尔; traditional Chinese: 琴島-利勃海爾; pinyin:Qindao-Libohaier). The installation of Liebherr’s equipment and technology was accompanied by new quality management processes. By 1986, Qingdao Refrigerator had returned to profitability and sales growth averaged 83 percent per year. With sales of just CNY ¥3.5 million in 1984, sales rocketed to CNY ¥40.5 billion by 2000; a growth of more than 11,500 percent.
The municipal government asked it to take over some of the city’s other ailing appliance makers. In 1988, the company assumed control of Qingdao Electroplating Company (making microwaves) and in 1991 took over Qingdao Air Conditioner Plant and Qingdao Freezer and in 1995,took overQingdao red star electronics co., LTD,which has been a famous business case included by the business school of Harvard.
Zhang Ruimin and the corporate revival
By the 1980s, the factory had debt of over CNY ¥1.4 million and suffered from dilapidated infrastructure, poor management, and lack of quality controls, resulting from the planned economic system and relevant policies.[3] Production had slowed, rarely surpassing 80 refrigerators a month, and the factory was close to bankruptcy. The Qingdao government hired a young assistant city-manager, Zhang Ruimin, responsible for a number of city-owned appliance companies. Zhang was appointed the managing director of the factory in 1984.
When he arrived in 1984, Zhang decided that improvement was needed to the factory’s quality control.
In 1985, a customer brought a faulty refrigerator back to the factory and showed it to Zhang. Zhang and the customer then went through his entire inventory of 400 refrigerators looking for a replacement. In the process he discovered that there was a 20 percent failure rate in his merchandise. To emphasize the importance of product quality, Zhang had the 76 dud refrigerators lined up on the factory floor. He then distributed sledgehammers to the employees and ordered them to destroy the refrigerators. The workers were hesitant; the cost of a refrigerator at the time was about 2 years worth of wages. Seeing their distress, Zhang said: “Destroy them! If we pass these 76 refrigerators for sale, we’ll be continuing a mistake that has all but bankrupted our company.” The refrigerators were destroyed. One of the hammers used is on display at company headquarters as a reminder to posterity.
The Haier brand
In 1995 Haier bought out its chief rival in Qingdao, Red Star Electric Appliance Factory. In 1997, the company moved into television manufacturing with the acquisition of Huangshan Electronics Group. By the end of the 1990s, Haier sold many products includingmobile phones and computers, and had the largest national market share in its core white goods division.
International expansion
The company opened a production facility in Indonesia in 1996, and the Philippines and Malaysia in 1997. The company tried to compete in the Thai market, but they completely lost to local electronics companies and had to stop the marketing there. In the US it focused upon two niche markets in compact refrigerators and electric wine cellars.
Haier began to manufacture full-sized refrigerators for North American market. This would bring it into direct competition with established American companies GE, Whirlpool, Frigidaire, and Maytag. As part of its strategy, Haier built a production facility in the United States atCamden, South Carolina, opened in 2000. By 2002, US revenues reached USD $200 million, still small compared to its overall revenue of $7 billion. Also in 2002, Haier moved into a building in midtown Manhattan. Formerly the headquarters for the Greenwich Savings Bank, the 52,000-square-foot (4,800 m2) building was built in 1924 in theneo-classical style.
Production facilities were constructed in Pakistan in 2002 and Jordan in 2003. In Africa, Haier has plants in five countries: Tunisia, Nigeria, Egypt, Algeria and South Africa. The company also purchased a factory in Italy, and began placing its products in European retail chains,[which?] either under its own brand or under OEM agreements with foreign partners. Currently Haier has entered into a joint venture agreement with the government of Venezuela.
Haier Appliances (India) P. Ltd initiated its commercial operations in January 2004. It was also listed among the top 20 most trusted brands in India by The Brand Trust Report, a study conducted by Trust Research Advisory.
In June 2005, Haier made a bid to acquire Maytag Corporation, backed by private equity funds Blackstone Group and Bain Capital. The bid was for USD $1.28 billion, or $16 per share, topping a previous offer of $14.26 per share made by Ripplewood Holdings.In the end however, Maytag was bought by Michigan based Whirlpool Corporation which offered $1.7 billion in cash and stock, or $21 per share, plus assumed debt.
As of 2008, Haier had surpassed rival Whirlpool as the world’s top refrigerator producer in terms of sales, according to Euromonitor, an independent business intelligence provider. Haier said it sold 12 million refrigerators worldwide, up 20% over the previous year. Its market share reached 6.3% globally.
In 2012, Haier Group bought the New Zealand appliance manufacturing company Fisher & Paykel.”
In 2019, Qingdao Haier officially changed its name into “Haier Smart Home”.
*Information from Forbes.com and Wikipedia.org
**Video published on YouTube by “Haier KSA“