Category: Sigelei

On May 4, Sigelei (871818) released its 2019 annual report. In 2019, the company achieved an operating income of RMB 107,408,097.46, a year-on-year decrease of 52.25%; it realized a net profit attributable to shareholders of listed companies of RMB -23,148,091.24, which was a year-on-year profit turnaround.

At the end of the reporting period, the company’s total assets were 134,159,304.00 yuan, down 31.55% from the beginning of the period; the net assets attributable to shareholders of listed companies were 84,160,444.77 yuan, down 21.57% from the beginning of the period.

It is understood that operating income decreased by 52.25% over the same period of the previous year, mainly due to the impact of increased tariffs in the United States in 2019, and New York State announced a ban on the sale of flavored electronic cigarettes. On November 1 this year, the State Tobacco Monopoly Administration and the State Administration of Market Regulation and Administration issued the “Notice on Further Protecting Minors from Electronic Cigarettes,” requiring all Internet online channels to stop selling e-cigarette products, leading to a decline in sales.

Operating costs decreased by 42.68% over the same period of last year, mainly due to: operating income decreased by 52.25%. Due to fierce market competition and the impact of increased tariffs in the US market, this year’s product revenue decreased, resulting in lower costs.

Administrative expenses decreased by 23.13% compared with the same period of the previous year, mainly due to: the current salary decreased by 1.4 million and other expenses.

R & D expenses increased by 29.22% over the same period of last year, mainly because: the company continued to increase investment in product research and development.

Sales expenses increased by 23.39% over the same period of the previous year, mainly due to: the increase in advertising expenses and business promotion fees.

According to the online data, Sigelei is a professional electronic cigarette manufacturer and brand operator integrating R & D, production, sales and service.

Interviewer: Why are many brands still using ceramic core atomizers?

SIGELEI CEO: I was the first one to make ceramics heating core in the industry. When I worked as an engineer in Jieshibao, I developed absorbent ceramics. At that time, I also applied for a patent, called absorbent ceramics electronic cigarette. At that time, I wanted to use pod to drive the mod business. Later, I abandoned this project with my departure. Later, I worked with Americans to make a ceramic chip, but I still use cotton tie in it. One advantage of this product is that it is very simple and fast to assemble, which reduces the production cost. Another reason for the rise of ceramic cores is that there are big pushers behind them. You can see who pushed the ceramics up and who spent how much money to promote them. Ceramic core gets popular virtually in one year or two years. From the beginning of electronic cigarette to now, why cotton core has always been popular. Why cotton heating core has been alive to now, and is still very sold well. For the whole electronic cigarette industry, ceramics heating core is just the tip of the iceberg. The best taste is mod vape DIY that uses cotton heating core. The only advantage of ceramics is to make its producer rich quickly.

Above is a part of the interview to the SIGELEI CEO, here comes the rest.

Interviewer: What are the advantages of SIGELEI pod vape?

SIGELEI CEO: We started our business in September 2011. We also made pod vape then. The shape of the pod system was the same as that of today’s pod. But the atomizers and batteries were not so good at that time. The earliest ceramic core for atomizers was abandoned by consumers. Later, we led people to the direction of mod vape.

At that time, the vape processing was relatively scattered, atomizers producers make atomizers only, batteries producer make batteries only, and box producers make boxes only. Customers then wanted to buy them all at once. Initial consumers bought atomizers, boxes, batteries, chargers and e-liquids from different shops. Now we can do it all by one company, so the starter kit is made. In the past, no enterprise could control all the chains alone. At that time, because the quality was not good enough, producers could not make a finished product by ourselves. And at that time, people bought electronic cigarettes with problems do not know who to look for, no after-sales. Little brands can make a finished product in the whole industry. Electronic cigarette device, atomizer, e-liquids are made by ourselves, we have been in good shape many years ago, but not integrated together, now just integrated together.

That’s why RELX didn’t open its own factory to do it. Now FLOW started to build his own factory to do it. It’s certainly not that easy. There will be a lot of problems waiting for them.

The industry needs expertise, even if a group of professionals are invited to do it, it will take a long time for the team members of different personalities to adapt to each other, there will be a lot of problems. It depends on whether they can bear a bad result.

Interviewer: Why did SIGELEI start making pod vapes at this time?

SIGELEI CEO: Our company has been doing a good job in box mod. SIGELEI has become a synonym for mod, and its position in the industry is very stable. We have been following the vapers who understand electronic cigarettes, responding with continuous research, continuous innovation, which builds the achievement of SIGELEI today.

China’s logistics and e-commerce are well developed, and the release of information is very fast, unlike in the United States, we are going through channels.

If we want to enter the Chinese market, we first need to know the national policies and regulations, which direction electronic cigarettes will go. I’m the president of the Electronic Cigarette Association. I already know which direction I’m going to go. The Chinese market is now popular with small cigarettes. We will do what Chinese consumers like, and then we must cater to the national policy.

I can’t easily disclose the China policy orientation too directly, but everything is going well. The electronic cigarette industry will certainly have a place in China. The state will certainly regulate it, but it tends to assist the promotion of the vape industry and help the industry get better and better.

Interviewer: What are the main functions of Shenzhen Electronic Cigarette Association?

SIGELEI CEO: Shenzhen Electronic Cigarette Association was founded in 2015. At that time, people wanted to hold a group to get some warn. We tried to make our voice heard by the government. We could not allow some media to smear electronic cigarettes. We hope to have a dialogue with the government.

Interviewer: Do you think it’s too late for SIGELEI to join the pod vape market now?

SIGELEI CEO: At present, electronic cigarette technology is king, not sales channel. Channels are useless. In the past, there was No. 1 enterprise in the industry, but they disappeared overnight because of the technological progress of us behind. Our product did not leak e-juice while theirs leaked. People cannot found their leakage free products overnight then the sales channels disappeared eventually. Those products that depended on channels disappeared in minutes. It is equivalent to the current internet enterprises. The low price is due to the immaturity of the products, so it is meaningless to fight the price war. In the end, it would be banned. It would better to earn some quick money.

Some people say that the development of electronic cigarette technology makes the products similar today, there is no big difference. I can only say that without experiencing good things, you won’t think about this issue, nor will think about if you’re right.

Interviewer: Why don’t you rebrand pod, but continue to use the brand of SIGELEI?

SIGELEI CEO: I think rebranding doesn’t help much. A new brand needs to foster consumer trust, and we don’t need to spend any more time doing that by using SIGELEI.

Interviewer: Does SIGELEI have a financing plan recently?

SIGELEI CEO: Financing is certainly a good thing, but if some companies do not have their own research and development, but focus on the marketing, financing is not a good thing for it. I do not exclude financing and capital. I hope that capital will support industry more and not some short-term interests. You can pursue your short-term interests, but don’t destroy the target needs of an industry.

Some people asked if the electronic cigarette industry would be like the taxi renting APP Uber. I think that Uber is something that can be seen and touched, but electronic cigarettes are different. Does anyone think about whether this thing is healthy or not? Would you magnify the word “health”? Is it really 100% harmless? But some people can magnify it in the form of capital, it’s only a little better than cigarettes, but you brag it into perfect. I don’t think it’s good enough to be honest. If we give this experience to industrial factories, people who do business are naturally pragmatic and naturally do not boast too much, then the industry will not be so inflated. Now the capital only finds some people who write PPT, only some who will boast, and will definitely be abandoned by consumers. The electronic cigarette industry will not be killed if it has real ability, especially in recent years, the electronic cigarette industry has achieved good results. Money isn’t a must to do a good job of the product, a good product doesn’t mean much of cost. Of course, many people lack money, and hope to find more money, but some brands get capital to hire a group of people. But after a year, they did not produce a product. The greater the capital, the greater the disgrace after the brand did an awful job. Lies can only deceive people for a while, not for a long time. The first group of people like to invest in Internet companies, but now investors like to look for factories. Now I have access to a lot of capital, but we have to choose the ones that integrate with our resources. I don’t need their money purely, but I need their resources.

Interviewer: What’s your expectation to glori?

SIGELEI CEO: I hope glori can lead the industry, be more environmentally friendly, set up an industry benchmark, let everyone take cotton core as the leading factor, make everyone be healthier, make everyone know the difference between cotton core and ceramic core, if you feel that cotton core is healthier, its mission will be completed.

Vapor through ceramics heating core sucked into the lungs, into the blood, causes discomfort and illness. It can not be detected for decades. It can not be found out in a short time. I know the situation of ceramic suppliers like FEELM. The material of first batch is totally different from the second batch. The third batch is still different. What is the inspection standard for the materials? The true situation of supply and demand now is, even if the quality is not good, the products should be produced still. Anyway, everyone fight for money, more exactly, many people try to make quick money.

But when the cotton core is burnt, it can be seen. While the burnt ceramic core can’t be seen. You don’t know what is inhaled into your lungs. The smoke just feels lighter, but you don’t know what is sucked into the lungs is also particles, small sand particles, small aerosal particles. These small particles all enter the lungs. So I want consumers to know the value of cotton core. (Doesn’t the cotton core react chemically after burning?) After burning, the cotton core sticks together and will not be sucked in. While ceramic dust will be sucked into the lungs.

We have also used ceramic cores and the finished products are very good, but we still don’t want to produce them. Because when the ceramic core generates 100 puffs, the flavor and taste will drop, which’s generally called poor consistency. However, cotton core heated flavor goes bad after 3 tanks of e juice – 900 puffs. The cotton heating core is much more durable and stable than the ceramic heating core. It provides a highly consistent, pure and smooth vaping experience.

Verdict

Every enterprise has its own stand, excuse and plea to protect its own interests.

What you all need to keep in mind while reading above content is that SIGELEI is a traditional mod vape manufacturer. Pod vape is only a lead to its mod business.

ALD will do give SIGELEI a lesson when they heard that ceramics heating core is not better than cotton heating core.

Click here for more information about SIGELEI.

Professor Zhang Weizhi, Vice-Director of Science, Technology and Industrial Culture Research Center of Zhejiang University, and MR. Saeed, Senior Consultant of the United Nations International Trade Center, visited Dongguan Sigelei Company in Guangdong Province, and made in-depth idea exchanges on the development of the vape industry and Sigelei’s development on June 18, 2019.