The thriving subscription economy is creating new entrepreneurial miracles.
BEIJING, July 22, 2022 /PRNewswire/ -- Edianyun, a leading technology-enabled office IT service provider in China, recently submitted its completed application forms to the Hong Kong Stock Exchange for listing on the HKEx Main Board. According to business consulting firm Frost & Sullivan, Edianyun is the first and largest technology-enabled office IT service provider in China.
What is the driving force behind its rapid growth and expansion as well as the flourishing of technology-enabled office IT service?
There are three pillars that bolster the development of Edianyun's office IT services:
Remanufacturing capabilities and technologies
By the end of 2021, Edianyun owned the largest remanufacturing factory in China, with a remanufacturing capacity of over 600,000 sets of computers. By leveraging its cutting-edge remanufacturing technologies, Edianyun can extend the service life of devices from an average of 3 years to 7-10 years, greatly boosting utilization efficiency.
Edianyun has also standardized the remanufacturing processes and chip-level precise repair technologies to optimize production, reduced the average timespan of remanufacturing processes to less than 10 days, and the average remanufacturing cost to less than RMB 100 per set.
Efficient self-developed system of operations (Nebula system)
Edianyun's self-developed Nebula system integrates services, devices and information, and connects the front-end and back-end operations that allow to efficiently manage devices on a large scale, handle complexity demands of business management, and provide timely customer service.
Remarkably high customer retention
Through a series of competitive self-developed technologies, Edianyun has established the technological strengths that anchor remarkably high customer retention rate. For 2019 and 2020, Edianyun achieved net dollar retention rate of 133.8% and 110.6%, respectively. As of September 30, 2021, that figure was 124.2%. The consistently high levels of customer retention indicate strong customer stickiness.
For 2019, 2020 and first three quarters in 2021, the recorded revenues of RMB632 million, RMB813 million and RMB838 million respectively, with corresponding gross margins of 38%, 41.4% and 48.4%. Edianyun's pay-as-you-go office IT services, the business sector from which generates primary revenue, accounted for 85.4% of total revenue for the year ended September 30, 2021. As of September 30, 2021, adjusted net profit amounted to RMB 74.9 million, turning losses into profits. This cannot be achieved without the brand loyalty and customer appreciation with comprehensive services. The excellent financial results are also owed to high customer stickiness and extensive coverage of golden customers from SMEs of various market segments.
The business enjoys promising prospects, especially when compared with a market penetration rate of 60.0% in terms of the number of devices in the United States in 2020, the usage-based office IT services industry in China has a penetration rate of merely 2.1%. And yet, the market size of usage-based office IT industry is expected to reach RMB 29.2 billion by 2025, representing enormous growth potential.
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