iHealth’s BestSeller product, iHealth New Crown Antigen Home Self-Assessment OTC Kit, has just signed a large contract worth about RMB 8.1 billion, and all deliveries will be completed 60 days after the contract takes effect.
What level is this 8.1 billion contract? In 2020, Jiu’an Medical’s annual operating income is about 2 billion yuan, and the total product revenue of the iHealth brand is about 1.4 billion yuan.
That is to say, 2022 has just started, and the iHealth order will top the income of the past 4 years!
iHealth is a brand of Jiu’an Medical. It sells blood pressure monitors, blood glucose meters, forehead thermometers, test kits and other popular medical products, which often appear on Amazon’s BSR lists in various categories.
The operation mode of iHealth in the Jiu’an medical system is that the parent company in Tianjin sells to overseas subsidiaries first, and then the overseas subsidiaries are responsible for overseas sales. For example, iHealth America is responsible for product sales and promotion in the Americas, and iHealth Europe is responsible for sales and promotion in the European market and the adjacent African and Middle East markets. The Hong Kong subsidiary is responsible for the sales and promotion of iHealth products in other overseas regions other than Europe and the United States.
In September 2014, iHealth introduced Xiaomi’s US$25 million investment and became Xiaomi’s partner in the health field.
During the new crown epidemic, the products surrounding the epidemic frequently experienced burst orders. In July 2020, iHealth forehead thermometer products once sold 20,502 units in a single day on the Amazon platform!
Until now, the iHealth brand is still a frequent customer of No.1 BSR in the baby temperature measurement product category, the forehead thermometer product in high demand.
Therefore, the performance of Jiu’an Medical in 2020 is also very bullish. That year, the operating income reached 2.008 billion yuan, a year-on-year increase of 184.36%, and the net profit attributable to shareholders of the listed company was 242 million yuan, a year-on-year increase of 264.68%.
By the end of 2021, Omicron will swept across the United States, and the number of new cases every day is increasing by hundreds of thousands or even millions. iHealth New Crown Antigen Home Self-Assessment OTC Kit has suddenly become popular! In the sub-category ranking of self-test kits on Amazon’s US station, iHealth once soared to the top!
Some big sellers integrating industry and trade have an operational strategy, which is to use the C-end to build brand awareness, and then supply them to large institutions and retailers through the B-end, obtain large orders and ensure bargaining power, so as to get more. huge profits.
iHealth has become the BestSeller on Amazon and has fully completed its C-end brand building. It can be said to be better than its peers in order to obtain large orders such as government agencies.
A notable point is that in 2020 and 2021, iHealth did not have transactions with ACC or HHS, the customers of this 8.1 billion order. Since the fourth quarter of last year, due to the large number of Omicron cases, iHealth has received another divine assist in addition to the halo of Amazon’s BestSeller!
The iHealth transaction party, the US ACC (U.S. Army Contracting Command, US Army Contracting Command), is the main contract management department of the US Army Material Command, which mainly undertakes most of the contract work for the US Army. The U.S. HHS (United States Department of Health and Human Services, U.S. Department of Health and Human Services), represented by ACC this time, is the largest health security agency of the U.S. federal government and the official top management agency of the medical system.
On January 13, 2022, local time in the United States, ACC and HHS signed a contract with iHealth to purchase 250 million iHealth kits. The total contract price and tax amounted to $1.275 billion (including shipping costs), or about RMB 8.102 billion. .
The seller will deliver 25 million copies within 10 days of signing the contract, 100 million copies within 30 days, and all deliveries within 60 days.
In terms of payment method, from the effective date of the contract, the buyer will inspect and pay after the delivery is completed. However, there is an X-factor clause where the U.S. government has the right to suspend the contract at any time for its own reasons, or for supplier negligence.
Not only that, but this is not the only major government order from iHealth recently! According to the announcement of Jiu’an Medical in January, the New York State Department of Health ordered iHealth kits, and the cumulative amount of orders and contracts was US$185 million. The U.S. Commonwealth of Massachusetts and the Executive Office of the Department of Health and Human Services ordered iHealth kits with a total contract price of $148 million in taxes.
iHealth now has the feeling of riding a rocket upwards! Every day, orders of 100 million yuan are received. This is the dream of many sellers!
Going back to a year ago, such an order volume is completely unimaginable for iHealth!
In the first half of 2021, iHealth’s operating income is 200 million yuan, which is not comparable to any of the large orders mentioned above. The company’s net loss is still nearly 80 million.
Next, it is probably a story of making a fortune in the epidemic. Since the second half of last year, the share price of iHealth’s parent company, Jiu’an Medical, began to rise, and it has risen more than 10 times in the past six months!
Perhaps for most sellers, looking at such a giant, probably only envy.
But don’t forget that some methodologies may still be used for reference, such as being good at taking advantage of the general trend (could this be the reason why Xiaomi invests in iHealth), such as expanding the C-end brand to obtain stable profits through the B-end.