Money
Business opportunity a gas for entrepreneur
By Shen Jingting (China Daily)
Updated: 2010-04-13 09:52
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 Xing Ruisong (right) and his business partner Chen Ran start from scratch in this empty house. Zou Hong / China Daily |
Former CEO of IT company starts again by mapping out gasoline rates
The thirst for cheap gasoline in a city with more than four million automobiles gave Xing Ruisong the business opportunity he was looking for.
Xing, who had been the CEO of an IT company that provided software download services for Chinese mobile phone users, had been searching for a new niche for a year when he filled up his blue Kia with gasoline one day near the West Fourth Ring Road.
"The price of 93 octane gasoline was 0.3 yuan lower than it was in other places," the 36-year-old recalls.
"I did not know then that some gas stations actually charge less than the government's guide price."
Since Nov 10, the benchmark price of 93 octane gasoline in Beijing has stood at 6.66 yuan per liter, the highest in history. But the government allows the oil price to float within a certain band, so within the same city and even within the same gas company, prices can fluctuate from station to station.
Xing did the math. As someone who spent around 1,500 yuan a month on gas, if he used the discounted gas stations exclusively, he could get that cost down by something like 10 percent, saving himself 100 yuan or even as much as 200 yuan a month.
He pondered the idea. With more than four million automobiles on the streets of Beijing, the number of people who might be interested in saving themselves 100 yuan or more a month could run into the millions.
"The majority of people care very much about the cost of oil," he said. "You can see that every time when domestic oil giants adjust the cost of gas, a long line of cars will form late into the night as people look for cheaper gas."
Xing thought many people must be just like him and have an interest in which gas stations were offering the best deals.
He realized it could be the business opportunity he had been looking for during the previous year, ever since he sold his IT firm in 2008 because, while it was profitable, it was not likely to be the runaway success he dreamed of.
"When I was 20, I made up my mind to establish my own company before I was 30," said the son of a farming mother and a factory-working father.
"My mother was younger than dad, but she looked much older," said Xing, as he looked back on the hard life that inspired him to become a successful businessman.
"I earned 2 million yuan by being a service provider for mobile network operators but the industry was full of competitors, which made the market chaotic," Xing said.
He wanted to be an innovator or one of the top companies in his field, instead of being part of a pack.
In June 2009, Xing brought his gasoline website idea to life, setting up ok619.com, which is called Youkewang in Chinese.
The site details real-time cheap gas information from forecourts all over China.
Xing said the site was very labor-intensive at the beginning and he made hundreds of calls every day to major oil suppliers, including stations run by Sinopec, CNPC, Sinochem and Shell.
Xing also used a network of friends to collect information and trolled through online gas news forums. "It was not easy to do the job alone," Xing said.
As the website became established, he gratefully accepted help from an army of volunteers, who he dubbed Youmi, which means "oil rice" in Chinese.
"We depend on each other. Without Youmi, ok619.com would be almost impossible to operate. On the other hand, the website provides useful information for Youmis."
Today, there are between 200 and 500 Youmis helping on any given day to report and record gas station prices. They ask for no pay and come from all industries and walks of life. Among their number are bankers, government officials and workers in logistics companies.
All are motivated by a desire to help their fellow motorist save money.
According to Xing, his team processes 500 to 700 pieces of oil price information every day, and the website has daily traffic of 100,000 independent IP visitors.
Ok619.com currently has real-time price information from 7,765 gas stations around the country. Beijing has the most gas stations covered by the site out of all the Chinese cities, with 877. Shanghai and Guangdong are not far behind.
And the size of the site is growing all the time, with almost 100 gas stations added every week.
"After I set up ok619.com, I found a similar website in the US. It's called 'gasbody' and was selected as one of the 50 most valuable websites in the world by Time magazine," Xing said.
He said the plaudits enjoyed by gasbody had been a great inspiration.
The next step for him will be to include auto workshops on the site and offer netizens information about cheap car washes, insurance policies and share maintenance tips.
After investing 300,000 yuan and having seen the site become established and grow in popularity, the next milestone will be for it to begin to turn a profit.
It's something Xing is driving toward.
