Daedong makes itself more competitive in the market with future businesses and hits the KRW 1 trillion mark in sales for three consecutive years
2023 sales revenue and operating profit reach KRW 1.4333 trillion and KRW 65.4 billion, respectively
Daedong makes itself more competitive in the market with future businesses and hits the KRW 1 trillion mark in sales for three consecutive years
- Despite most of the agricultural machinery market slumping by double digits in 2023, Daedong responded strategically thanks to preparations made well in advance for potential business areas going forward
- In 2024, the company will look to build new business models for the future involving autonomous agricultural machinery and precision agriculture driven by its “AI-DATA-Robot” strategy
- Daedong also wants to innovate existing business to maximize customer value, reinforce its dominance overseas, improve the efficiency of its management, and improve profits
Faced with a deteriorating business environment in 2023, Daedong pushed for sales throughout the year thanks to a highly competitive business model driven by the company’s willingness to invest in the future, and that is perhaps why it managed to hit the KRW 1 trillion mark in sales revenue for the third consecutive year.
Future ag-tech platform company Daedong (Co-CEO: Kim Jun-sik, Won Yu-hyun) announced on March 29 that its consolidated sales and operating profit in 2023 were KRW 1.4333 trillion and KRW 65.4 billion, respectively, down just 2.1% and 25.9% from the same period last year.
Most agricultural machinery markets, in both Korea and abroad, shrank last year due to the global economic downturn, prolonged high interest rates, and surging agricultural production costs. In fact, compared to the previous year, the Korean agricultural machinery market shriveled by approximately 21%, and the North American market for sub-100 horsepower tractors shrank by about 11%.
Nevertheless, Daedong has been pushing for a “Digital Transformation” for its future businesses since 2020, and in doing so, the company has responded flexibly and strategically using a newly developed management system and organizational capabilities. A consolidated sales of KRW 1.4333 trillion is proof that this strategy is working in spite of difficult market conditions. Daedong has exceeded KRW 1 trillion in sales for three consecutive years since 2021, and has once again solidified its no. 1 position in the market by creating a gap of roughly 30~40% in sales with other agricultural machinery companies in Korea. Meanwhile, the company’s operating profit came in at KRW 65.4 billion last year thanks to strategic investments in future businesses such as smart agricultural machinery and farms, mobility, robots, and GME, and increased interest expenses due to the effects of rising interest rates.
This year, Daedong plans to deliver new customer value with innovative products and services, and to focus on building a business model that will, hopefully, lead to external growth of the company. Daedong is looking to become an agricultural company of the future, which is why the company wants to reinforce its capacity in robotics, autonomous agricultural machinery, and agricultural solutions as well as platforms. In addition, Daedong hopes to focus on quantitative and qualitative growth through innovation in existing businesses, and seek to strengthen its dominance in overseas markets, maximize operational efficiency, and boost profitability. To this end, the company is ready to execute operational solutions in 2024 with a focus on “making future businesses current” and “accelerating its business innovation.”
As for “making future businesses current,” Daedong is going to apply “AI-DATA-Robot” as core elements of its future businesses to some of its existing business ventures to generate new customer value. In this regard, Daedong plans to: increase domestic sales of mid-to-large autonomous tractors; develop precision agriculture technology and establish relevant business models; promote overseas agricultural solutions and its platform businesses; grow the electric scooter market and secure the no. 1 spot in the Korean market; launch robots for agriculture and gardening applications in Korea and abroad; open a new Jeju Daedong office and make sure to establish its presence locally.
As for “accelerating business innovation,” Daedong will build a new business system that can create greater customer value driven by bold innovations across all of its operations, including product planning, product development, purchasing, production, sales, and service. Accordingly, the company will focus on expanding its market share in the tractor market by upgrading its operation system for overseas corporations, finding partnerships to foster agricultural industries in markets such as Africa, strengthening its cost competitiveness through SCM and manufacturing innovation, and an integrated operation of development/purchase/test groups.