One hundred years ago, Ford successfully manufactured cars due to his persistent "industrial spirit"; one hundred years later, Gree also created a vast patent empire of air conditioners by adhering to the "industrial spirit".
For many years, Gree Electric Appliances has been dedicated to the research and development of patented technologies, driving development through innovation, and striving to enhance its influence in both domestic and international markets. After more than three decades of hard work, the Gree brand has become well-known to all, successfully capturing 30% of the domestic household air conditioning market share. It has also become one of the few Chinese manufacturing enterprises with over 100 billion yuan in revenue, 10 billion yuan in profit, and a market value of over 100 billion yuan.
Turn the tide when it is about to be lost and prop up the building that is on the verge of collapse.
Since entering the second decade of reform and opening up, China's economy has gradually integrated with the world. At the same time, it coincided with the "deindustrialization" and industrial transfer of developed countries, and a large amount of foreign capital flooded into the Chinese market. A large number of manufacturing enterprises with international competitiveness have emerged one after another.
In 1985, the predecessor of Gree, Zhuhai Special Economic Zone Industrial Development Corporation, established Guanxiong Plastic Factory. Zhu Jianghong, who was a technician by background, became the general manager of Guanxiong Plastic Factory in 1988. He seized the opportunity of the electric fan market to earn the first pot of gold and achieved the transformation and upgrading of the traditional plastic manufacturing enterprise as well as the turnaround from loss to profit. In 1991, Guanxiong Plastic Factory merged with the poorly performing Haili Air Conditioner Factory to establish Gree Air Conditioner Factory. Subsequently, Dong Mingzhu joined the company, which marked an important beginning for Gree's development.
In August 1996, under the leadership of Dong Mingzhu, Gree achieved a 17% sales growth and surpassed Chunlan, the "Air Conditioning King", for the first time. Thereafter, it maintained the top position in the country in terms of air conditioner production and sales volume, sales revenue and market share for 11 consecutive years. Gree also entered a glorious era.
In 2012, Gree Electric Appliances surpassed the 100 billion yuan sales mark, becoming the first single listed home appliance enterprise in China to achieve an annual revenue of over 100 billion yuan.
Behind this series of impressive achievements, there are continuous optimizations and adjustments in product structure, sales channels, and management mechanisms by Gree. It also cannot be separated from the important support of technological innovation and patent strategy. From a traditional manufacturing small factory on the verge of bankruptcy, Gree has transformed into a highly sought-after listed company. Whether in times of economic prosperity or during the financial crisis, Gree has always prioritized the construction of an intellectual property system, regarded air conditioning technology research and development as one of the largest investment directions, and hired Sunshine IP as its important intellectual property think tank to help build a comprehensive intellectual property system.
The height of a building depends on the firmness of its foundation.
Gree recognized early on that the accumulation of patent quantity and the improvement of patent quality determine an enterprise's innovation capability. The top companies in the industry are also more inclined to develop into light-asset companies with technological reserves. The accumulation of patents not only enables a company to avoid attacks in competition and be more proactive but also, when the technological reserves reach a certain level, can be used to generate profits for the enterprise through patent licensing and patent transfer. Therefore, Gree early on sought out Sunshine IP, relying on its professional service capabilities to help it build a comprehensive intellectual property system. The main points of this effort are as follows:
Establish systematic connections for patent work at each stage of technology pre-research, achievement protection and achievement transformation. Starting from the management and planning of intellectual property rights serving the company's overall development strategy, with patent search, patent mining and analysis, patent training and other businesses as the main focus, form point-to-point service coordination teams, make multi-point plans, precise promotion and overall arrangements for intellectual property rights demands at different stages, form a linkage effect, and establish the core position of patents in the company's innovation and development strategy.
2. Conduct thorough market risk assessment and overseas risk early warning. During the process of technology research and development and product promotion, it is necessary to not only avoid the tight patent blockade network established by domestic and foreign enterprises but also submit hundreds of peripheral patent applications around some key basic patents, in order to cope with the new business environment in the air conditioning manufacturing industry, which is dominated by intellectual property rights demands and technological innovation demands.
3. Dealing with patent infringement lawsuits and patent invalidation lawsuits. As an industry with a high concentration of intellectual property rights, it is inevitable to encounter "patent wars". How should Gree respond? In 2017, Oukes separately filed lawsuits against Gree Electric Appliances in the Ningbo Intermediate People's Court, claiming that Gree had infringed its utility model patent "Motor Direction Installation Seat" (ZL201520143902.0) and its invention patent "Method for Automatic Detection of PG Motor Faults" (ZL201010039703.7), demanding that Gree Electric Appliances cease infringement and pay a total compensation of over 100 million yuan.
The Intermediate People's Court of Ningbo ruled that Gree should immediately cease manufacturing, selling and offering to sell the infringing products, destroy the inventory of the infringing products and compensate Aoke for its economic losses. Regarding the above-mentioned utility model patent, two invalidation requests had been filed by well-known law firms in the industry earlier, but both failed. After taking over the case, Sunshine IP obtained novelty evidence through search. On January 14, 2019, the Patent Reexamination Board made a review decision on the invalidation request, declaring the utility model patent "Motor Direction Installation Seat" (ZL201520143902.0) completely invalid. Ten days later, the Patent Reexamination Board of the National Intellectual Property Administration declared another invention patent of Ningbo Aoke, "Method for Automatic Detection of PG Motor Faults" (ZL201010039703.7), invalid. Sunshine IP thus won another major victory in the patent war for Gree Electric Appliances.
Compared with invention patents, the patent application of utility models has its irreplaceable functions and is more in line with the fast-paced market changes and product demands. Its own review cycle is relatively short. Therefore, for some household appliances and fast-moving consumer goods, it is necessary to quickly authorize the corresponding patents of the products to achieve the dominant position of the products in the market before their launch. Especially in the highly homogenized home appliance field, the technologies of various air conditioner manufacturers tend to be similar. After the launch of new products, many followers will imitate them. The rapid authorization of patents can play a good deterrent role against subsequent imitators. At the same time, imitators, under the pressure of infringement risks, will make improvements to the products of this category, which in turn will promote technological innovation and contribute to the healthy development of the innovation level of the entire industry.
Up to now, Gree has entrusted Sanju Sunlight with over 1,500 intellectual property projects each year, with a cumulative agency volume of more than 5,000 cases and a total value of over 100 million yuan. Moreover, several agents have received "Agent Appointment Letters" from Gree for their outstanding performance. While providing comprehensive protection for Gree's new products, Sanju Sunlight has also assisted Gree in promptly and effectively handling multiple patent disputes with its competitors. Additionally, to help Gree enhance its overall business capabilities, Sanju Sunlight has specially developed a patent technology mining mechanism for Gree, jointly conducting topic mining, discussion and research on cutting-edge technologies in the industry with Gree, which has stimulated enthusiasm for business expansion and technological research and development, further promoting the improvement of work quality and efficiency.
Looking back on the 30-plus years of growth and transformation of Gree Electric Appliances, with the accompaniment of TriSun, Chinese enterprises represented by Gree have undergone an era change from imitation to having original and independent intellectual property rights. The development concept of "independent innovation" has been consistently adhered to. Just as described in Gree's advertising slogan, "Good air conditioners are made by Gree" and "Gree, making the world fall in love with Chinese manufacturing", Gree's success seems to be the best reward for its unremitting pursuit of the "industrial spirit". It can be expected that the accumulation of patent potential will enable Gree to have better resilience when encountering a bottleneck period, and we also look forward to Gree creating the next miracle.
