Edianyun, an office IT integrated solution provider, unveiled its new high-end desktops on its website in November, making it the first office IT integrated solution platform in its category to cover the needs of employees working with AI.
Since its inception in 2014, Edianyun has positioned itself as an IT service expert. It covers a range of businesses, from pay-as-you-go subscriptions of IT devices, managed IT services, and SaaS products to sales of devices. With its self-developed remanufacturing technology, Edianyun has created an industry chain for circulating and recycling IT devices, generating high returns.
How can IT integrated solution providers get rid of low gross profit?
Typically, the gross profit for device rental service stays low, around 10% – 20%. However, Edianyun offers a different service. The published data shows that the gross profit margin for the years ended December 31, 2019, 2020 and 2021, and for the six months ended June 30, 2021 and 2022 were 38.0％, 41.4％, 47.7％, 47.9％ and 50.9％, respectively. The gross profit margin for the six months ended June 30, 2022, increased by more than 33.9% as compared to that in 2019. How did Edianyun accomplish this?
The services provided by traditional device rental service providers are more similar to financial services. Lessors purchase devices through financing and make a profit with an interest margin. However, Edianyun considers that the problem facing small and medium-sized enterprises is that they are unwilling to spend excessive energy on minor issues such as software installation, system upgrades, and network maintenance rather than being unable to afford devices. They require a service provider with one-stop solutions for all routine IT problems, precisely the problem Edianyun pinpointed and addressed.
Edianyun provides IT devices and, more importantly, efficient IT services, with even one IT engineer taking care of 10,000 devices, which enhances profit. On top of that, it lowers the costs of IT devices through its proprietary remanufacturing technology. Edianyun is equipped with a wide range of capabilities to develop diversified business forms, including device subscription, IT services, and remanufacturing in a coordinated manner, thus creating a new office IT business pattern.
Edianyun had an NDRR of 133.8%, 110.6%, and 124.2%, respectively, from 2019 to 2021. These indicate high customer retention and rapid growth of new customer base. It is also the key for the Company to enlarge its operating scale.
How to adapt to the ESG strategy to ensure rapid growth and environmentally friendly operations?
Edianyun’s circular economy development model has begun to bring benefits. A clear advantage differentiating Edianyun and its counterparts is that it has the world’s largest PC remanufacturing factory, extending devices’ life span from an average of 3 years to 7 – 10 years. With a prolonged life span, PCs can support more customers, thereby maximizing the value of devices throughout their service life and significantly reducing the depreciation cost, which in turn facilitates the increase of the gross profit margin and helps improve Edianyun’s long-term competitive cost advantages.
The remanufacturing technology of Edianyun can not only reduce waste and carbon emissions but can also save material and energy expenses. Based on an assessment of the carbon footprint of Edianyun’s operations, its business model has enabled it to achieve an annual greenhouse gas emission reduction of more than 50,000 tons of carbon dioxide equivalent and is expected to enable it to achieve an annual greenhouse gas emission reduction of more than 80,000, 140,000 and 250,000 tons of carbon dioxide equivalent in 2022, 2023 and 2024, respectively.
Edianyun’s remanufactured PCs are almost the same as the new ones in terms of appearance, performance and user experience. Therefore, the quality products and mature services make its remanufactured PCs a preferred choice for SMEs. From the standpoint of environmental protection, mass production combined with more efficient and less expensive maintenance presents unlimited possibilities for remanufactured computers in a low-carbon economy and circular economy.
Edianyun has realized rapid business growth in sync with high profitability, with successful efforts in exploring circular economy and low-carbon development in the field of office IT devices.
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