Shanghai Action Education Technology Co.Ltd(605098) (SH: Shanghai Action Education Technology Co.Ltd(605098) ) recently released its annual report for 2021, which is the first annual report issued by Shanghai Action Education Technology Co.Ltd(605098) after it was listed in April 2021.
Shanghai Action Education Technology Co.Ltd(605098) its main business is management training and management consulting. It is the first listed company in the field of management education in China.
According to the annual report, in 2021, Shanghai Action Education Technology Co.Ltd(605098) operating income was 555 million yuan, with a year-on-year increase of 46.62%, and the net profit attributable to shareholders of listed companies was 171 million yuan, with a year-on-year increase of 60.05%.
Shanghai Action Education Technology Co.Ltd(605098) ‘s main customers are small and medium-sized private entrepreneurs. Focusing on these high-quality customers, in addition to providing management training business with ultra-high gross profit margin, it has extended management consulting, sales of books, audio-visual products and other businesses. At the same time, Shanghai Action Education Technology Co.Ltd(605098) is also exploring new businesses such as investment and tax consultation for training customers.
Shanghai Action Education Technology Co.Ltd(605098) the boundary of future business exploration is based on strengthening the management training business. This is a 100 billion market. At present, the main body of the market is scattered but the competition is fierce. As the gross profit margin of management training is as high as 83.62%, Shanghai Action Education Technology Co.Ltd(605098) in recent years, the marketing is quite radical. At present, a sales team accounting for nearly 80% of all employees has been established.
industry lacks absolute leading brand
Enterprise management training is Shanghai Action Education Technology Co.Ltd(605098) the largest main business, accounting for 88.6% of the revenue in 2021.
“Condensed EMBA” and “principal EMBA” are the two main courses. Among them, “condensed EMBA” is a short-term course, the learning cycle is 3 days and 2 nights, and the price is about 35800 yuan.
EMBA for president is a long-term course, which consists of 10 courses such as recruitment and selection of talents and enterprise university; Among them, the learning time of single courses such as recruitment and selection of talents and mechanism design is 2 to 3 consecutive days, but the cycle of learning all 10 courses is 1.5 years.
The record of investor relations activities on November 29, 2021 shows that the tuition fee of principal EMBA is about 298000 yuan, accounting for about 48% of the income. The number of students in 2021 exceeds 1000.
Over the past decade, China’s enterprise management training business has begun to scale, large demanders have gradually included enterprise training in budget management, enterprise management training service providers have gradually taken shape, echelon Division has emerged in the industry, and the mode of teaching and speaking by teachers has been upgraded to the mode of project team operation.
From the perspective of demand, the majority of enterprises have improved their training awareness and training consumption ability; From the perspective of supply, enterprise management training institutions are developing rapidly, and business model innovation and technological innovation are emerging. At present, the management training industry has developed into a large-scale intellectual support industry.
According to the research of Zhongyan Puhua management consulting company, it is predicted that the market scale of management training will be 555.6 billion yuan in 2022 and 1034.1 billion yuan by 2026.
At present, there are mainly four types of institutions participating in the enterprise management training industry: business schools of colleges and universities, institutions of multinational training companies in China, consulting focused companies and enterprise management training companies.
Competitors of the same type as Shanghai Action Education Technology Co.Ltd(605098) mainly include Dark Horse Technology Group Co.Ltd(300688) (SZ: Dark Horse Technology Group Co.Ltd(300688) ), Hejun business school, Jucheng shares, Guanghua of the times, Shengjing online, etc.
(industry pattern of enterprise management training source: Shanghai Action Education Technology Co.Ltd(605098) prospectus)
At present, there are many enterprise management training institutions in China, but the overall scale is generally small, the phenomenon of homogeneous competition is obvious, the market concentration is low, and there is a lack of absolute leading brand.
Shanghai Action Education Technology Co.Ltd(605098) ‘s customers are mainly small and medium-sized private enterprises, and public information shows that they include Holitech Technology Co.Ltd(002217) , Shenzhen Txd Technology Co.Ltd(002845) , Autobio Diagnostics Co.Ltd(603658) , Beijing Dabeinong Technology Group Co.Ltd(002385) , Jason Furniture (Hangzhou) Co.Ltd(603816) , Weiqian holdings, mingchuangyou products, Kelan diamond, Vienna Hotel and other well-known Chinese enterprises or listed companies. In recent years, Shanghai Action Education Technology Co.Ltd(605098) each year there are about thousands of students.
explore and invest in student enterprises
Once the training course of high-quality business is recommended to trainees, once the training course of high-quality business generates reputation, it can be further recommended to trainees.
Among them, the most important are enterprise management consulting and sales of books, audio-visual products. Enterprise management consulting refers to accepting the entrustment of the customer of enterprise management training business and providing suggestions to the customer’s enterprise, including enterprise university, performance management, marketing control, financial control, brand strategy and so on.
However, in Shanghai Action Education Technology Co.Ltd(605098) 2021, the revenue of enterprise management consulting business was only 58.83 million yuan. Although it was larger than the revenue scale in 2020, it was still far smaller than that in 2018 and 2019. And the gross profit margin of the business in 2021 is only 44.3%.
( Shanghai Action Education Technology Co.Ltd(605098) 2021 main financial data source: Annual Report)
According to the records of investor relations activities on November 29, 2021, Shanghai Action Education Technology Co.Ltd(605098) the consultation cases are divided into two types: one is the scheme class, with a price of 288000 / class and about 7-8 enterprises in one class; The other is enterprise entry consultation, priced at 23 million yuan.
The record shows that “the consulting volume of the company is relatively insufficient. Due to the limited consulting teachers, we will use the limited resources to maximize the leverage. The consulting price is relatively high and lock in several high-end deliveries.”
Data show that the annual turnover of the consulting and information service industry around the world has reached hundreds of billions of dollars. The development space of China’s management consulting industry is also very broad, but small and medium-sized consulting institutions are difficult to gain an advantage in the competition with international giants and Chinese leaders.
Shanghai Action Education Technology Co.Ltd(605098) is exploring other new businesses. In July 2021, Shanghai Action Education Technology Co.Ltd(605098) signed a cooperation agreement with Guorui tax consulting company. In the record of investor relations activities on September 7, 2021, it was written that “taxation is the rigid demand of enterprises, and many companies do not have a deep understanding of taxation. From training courses to consulting, the company provides training courses, and Guorui provides consulting services, which is a process service.”
On September 14, 2021, Shanghai Action Education Technology Co.Ltd(605098) signed a partnership agreement with Shanghai Tianyu Investment Management Co., Ltd. to establish Hainan private equity fund partnership (limited partnership), with a total subscribed capital of RMB 200 million, of which Shanghai Action Education Technology Co.Ltd(605098) subscribed capital of RMB 199 million.
This is the layout of Shanghai Action Education Technology Co.Ltd(605098) in the investment field. According to the above investor relations activity record, at present, the investment fund is targeting the enterprises with development potential among the trainees (pro-ipo stage).
The trainees never went public and started to Shanghai Action Education Technology Co.Ltd(605098) study. Shanghai Action Education Technology Co.Ltd(605098) accompanied the development and growth of the trainees’ company until they went public.
talent barrier behind business
The development of consulting, investment and other derivative businesses is based on Shanghai Action Education Technology Co.Ltd(605098) continuously consolidating and expanding its main training business. For training business, the biggest barrier lies in talents.
Shanghai Action Education Technology Co.Ltd(605098) is actually controlled by the founders Li Jian, Zhao Ying and their son Li weiteng, who accounted for nearly 60% of the shares before listing Shanghai Action Education Technology Co.Ltd(605098) ‘s senior management team is relatively stable. Many of them followed founder Li Jian to establish Shanghai Action Education Technology Co.Ltd(605098) , even when Li Jian set foot in the advertising industry before.
Shanghai Action Education Technology Co.Ltd(605098) is characterized by “executives are lecturers”, and one of its main IP is founder Li Jian. According to the 2021 annual report, Li Jian was the general manager of Kunming Fengchi Star Information Industry Co., Ltd. from 1997 to 2000; From 2001 to 2006, he successively served as vice president and President of Tom Outdoor Media Group Co., Ltd.
In addition, Li Xian, the deputy general manager, Huang Qiang, the deputy general manager, and Yang Jing, the general manager of human resources, also served as keynote speakers. These senior executives and lecturers directly or indirectly hold Shanghai Action Education Technology Co.Ltd(605098) equity, which is conducive to maintaining the stability of the teaching team.
According to Shanghai Action Education Technology Co.Ltd(605098) official website, there are 14 lecturers in total. Besides full-time lecturers including the above-mentioned executives, there are also a number of external lecturers. Among them, four main lecturers held equity at least before Shanghai Action Education Technology Co.Ltd(605098) listing, and ranked among the top five suppliers of Shanghai Action Education Technology Co.Ltd(605098) for many consecutive years. Their annual training and consulting labor costs are in the scale of several million yuan.
It can be said that Shanghai Action Education Technology Co.Ltd(605098) has maintained the stability of the lecturer team as the core of the business through equity and high salary.
But is the lecturer the real driving force of Shanghai Action Education Technology Co.Ltd(605098) rapid development?
Enterprise management training has high requirements for knowledge updating. In particular, Shanghai Action Education Technology Co.Ltd(605098) is different from the college EMBA, with more emphasis on improving the effectiveness of enterprise management. For example, the condensed EMBA course has been updated to the 11th Edition. This requires higher requirements for the teaching and research team behind the lecturer.
However, the 2021 annual report shows that among the Shanghai Action Education Technology Co.Ltd(605098) 75 R & D personnel, there are only 9 postgraduates, less than 15 junior college students, and 38 under the age of 30. The proportion of young and low educated R & D personnel is relatively high, which will make the outside world have a little doubt about Shanghai Action Education Technology Co.Ltd(605098) ‘s R & D ability.
create the second curve
On the one hand, the growth prospect of enterprise management training business comes from the price increase. For the group of high net worth private entrepreneurs, the tolerance of price increase is high. In addition, it is more necessary to expand the scale of users.
Shanghai Action Education Technology Co.Ltd(605098) for this reason, the sales force is expanding rapidly. Within one year, the number of sales personnel has increased from 534 at the end of 2020 to 711 at the end of 2021, accounting for 79.98% of the total number of employees from 72.06%.
The company has set up five sales and service subsidiaries in Beijing, Shanghai, Shenzhen, Hangzhou and Chengdu, and branches in 13 provincial capitals and economically developed cities such as Nanjing and Wuhan, forming a service and marketing network covering the whole country.
The record of investor relations activities on March 17 shows that 80% of the new salespeople are used to encrypt the existing area. In 2021, a fission team encrypted the existing area and generated orders of about 40 million yuan, which is much higher than the team developing the new area.
These sales are called learning officers, who provide accompanying services to customers, help customers implement their achievements, and urge customers to complete the transformation of learning achievements. Through the learning officer service of branches across the country, the transfer rate from old customers to new customers is about 85%.
Shanghai Action Education Technology Co.Ltd(605098) also launched new enterprise management training products. In October 2021, the company launched Omo digital business school to help large enterprises establish Wuxi Online Offline Communication Information Technology Co.Ltd(300959) integrated enterprise universities, including “business school system”, “enterprise university SaaS platform” and “talent incubation project”. All employees of the client company can study on this platform, which is supervised by the head teacher in the whole process. They will study, practice, test, compete, brainstorm and group PK every week.
This is an extension of the to B business for entrepreneurs’ enterprises from the to C business for entrepreneurs. At present, the to B transformation of enterprise management training has become a great momentum, so as to reduce marketing costs and accurately serve users.
According to the record of investor relations activities on March 17, Omo digital business school sold about 100 orders in 2021, with prices ranging from 198000 yuan to 1.77 million yuan. At present, more than 60 have been delivered.
In the next three to five years, Shanghai Action Education Technology Co.Ltd(605098) will build Omo digital business school into the second curve. Although this business was included in the enterprise management training section in the 2021 annual report, its attribute of “consulting + software” is to standardize the consulting business, so as to extend the service chain.
This is still the mainstream product in the current enterprise training to B market. The reason is that the reserve of original training courses is insufficient. We have to start with SaaS services with low threshold and high degree of standardization. In other words, Shanghai Action Education Technology Co.Ltd(605098) further growth lies in improving the content service ability of lecturers and teaching and research.
