Xiaomi CEO reveals the secret behind its cheap smartphones


Xiaomi has become a popular manufacturer for offering its customers inexpensive products with good quality. According to the brand CEO Lei Jun, the secret lies in the fact that the manufacturer only has a profit margin of 8 to 9 percent.

For Lei Jun, the value of smartphones, in general, will become higher as brands focus on 5G technology. However, he believes that Xiaomi will be able to combine a competitive price with the high performance of its equipment.

While announcing the third quarter financial results of this year, Xiaomi CEO Lei Jun said: “I think the gross profit margin of 8% to 9% is very low and since our sales model is based on e-commerce sales, the pricing that the end customer ends up paying will be very cheap. The most important thing is that our own gross profit is very Low, and the middle channel is very short, so the final price in the retail market remains very attractive to the buyers.”

Xiaomi wants to keep prices low with the arrival of 5G

Xiaomi intends to maintain its sales strategy even with the arrival of 5G. Remember that Xiaomi is already the fourth best selling smartphone brand globally.

If the company keeps competitive prices coupled with quality, the end consumer also wins. And in the end, that’s what matters to anyone buying a new smartphone.

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