In 1987, Qingdao Zhenhua Motor Vehicle Sales and Maintenance Co, Ltd. (Qingdao Zhenhua for short) joined hands with SEM. More than 30 years later, Qingdao Zhenhua has become SEM’s longest-serving dealer, changing the lives of generations with product and service innovation and together with SEM making many dreams come true.
Mr. Zhao Shubin joined the Army at the age of 20 in 1976, serving in the Vehicle Maintenance Department. Since then, a bond has formed between Mr. Zhao Shubin and these “steel buddies.” Because of his interest in heavy machinery, Mr. Zhao Shubin studied mechanics after his transfer and later registered an auto repair shop in his hometown of Pingdu.
This young man became a success in the local auto repair industry. In 1987, SEM leadership was looking to develop the market in East Shandong and recruited Mr. Zhao Shubin. Today, Qingdao Zhenhua has expanded its business from Pingdu to Qingdao with whole machine sales, parts supply and after-sales service of SEM machines. The dealership has sold more than 3,000 SEM machines in 30 years. And the dealership’s chairman is Mr. Zhao Shubin. “Zhenhua has been fighting in the construction machinery industry for decades with a good reputation and credibility among customers. It was the close cooperation with SEM that made today’s achievements,” said Mr. Zhao Shubin.
Mr. Zhao Shubin says the relationship between the dealership and SEM is rooted in mutual trust. Over the past 30 years, Qingdao Zhenhua management has always valued kindness, righteousness, propriety, wisdom and trust. SEM adheres to a similar code of conduct. SEM products are also durable with great quality. Even during downturns in the market, SEM products are still widely used, reflecting their popularity and reputation in the market. “I have always believed if you’re consistent, you will get returns,” said Mr. Zhao Shubin.
Navigate the Market Together
For dealers in the construction machinery industry, upstream resources are the key to success. “As a responsible manufacturer, SEM has given Qingdao Zhenhua great assistance over the years. In 2003, the industry grew rapidly with market demand exceeding supply. In 2004, there was huge sales pressure, difficult payment collection and shrinking market demand due to industrial macro-control,” said Mr. Zhao Shubin. “Confronted by these difficulties, SEM required the dealers to make rolling forecasts weekly and monthly, and the operation and purchasing department made specific arrangements according to the actual situation. These gave a lot of space to the dealers in the face of a sluggish market.”
“Construction machinery is a typical cyclical industry. The operating environment may change with the economic cycle. No matter whether the economic environment is good or not, SEM and the dealer closely work together based on their common values, moving forward together in good years and limiting difficulties during downturns.”
Over the years, the sustained, positive and risk-sharing cooperation between Caterpillar and its dealers has been praised by the public, and the successful distribution network has become an important factor in Caterpillar’s global development. In 2008, SEM became Caterpillar’s wholly-owned subsidiary. SEM and Caterpillar share similar values. SEM spares no effort in providing training for dealers and the cultivation of talent from sales to internal service to ordinary employees.
In 2011, SEM launched the motor grader with Zhenhua selling the first unit in Shandong Province. In 2012, SEM launched the track-type tractor with Zhenhua selling the first unit in China. SEM’s strong training policy markedly improved personnel quality and laid a foundation for achievement by its dealers.
Winning Customers with Service
“For customers, the product we sell is a production tool and the machine’s failure may lead to direct economic loss. We try our best to maintain services,” said Mr. Zhao Shubin.
“In the peak season, we often go to the front lines to win customers with our service. Our service staffs are available 24 hours a day, ready to troubleshoot for customers. We will send staff members out even 100 kilometers to a site for troubleshooting, although sometimes it may just be a twist of the screw.”
Mr. Zhao Shubin says people often believe there is a secret to successfully selling equipment. He tells them there are no secrets but dedication, diligence, expertise of technology and service. “Once a client purchased over 10 sets of our wheel loaders. However, because the operation management couldn’t keep up with the vehicles, problems often occurred mostly due to the operators’ poor mechanical sense and lack of responsibility. So, we communicated actively with the leadership and organized operators and vehicle management personnel for maintenance training to help reduce maintenance costs and enhance benefits for customers. Now, a training pilot is a part of our service. One day on a construction site, I saw that a vehicle was very dirty. I told the principal that the thick layer of dust on the vehicle may affect cooling, increasing the wear and tear and the probability of machine damage. Since then, the principal on the construction site frequently washes the vehicles and the need for maintenance has been reduced.”
Dealers are business partners as well as the bridge between the manufacturer and end users for SEM. Dealers are also invaluable for market feedback and an essential point in the value chain.
“Market share is the target pursued by every dealer. We shall improve service quality, customer satisfaction and cooperation to provide customers with more cost-effective products and optimal construction solutions,” said Mr. Zhao. Today’s Qingdao Zhenhua enters a new era under the guidance of General Manager Mr. Wang Xiadong and Chairman’s Assistant Mr. Zhao Xiaolong. Opportunity is often reserved for those who are prepared. Qingdao Zhenhua will continue to cooperate with SEM for mutual benefits, including continued growth in the Qingdao Market, as we march together towards the next decade.