China Tobacco Pays Over RMB 1 Trillion in Tax as Vaping Market Shows Huge Potential

As one of the most tragic companies in China's internet sector, Smartisan Technology has faced controversy since its inception. Its founder, Luo Yonghao, is a tragic figure whose entrepreneurial ventures have repeatedly ended in failure. However, he has fought back time and again, having worked as a GRE instructor, run a blogging website, and launched the Smartisan phone. Currently, Smartisan Technology is essentially on the brink of collapse, with its store products out of stock for over six months due to a lack of willing suppliers for processing. Now, Luo Yonghao is attempting to make a mark in the vaping market, but can he truly succeed?
 
The Resilient Entrepreneurial Spirit is Touching

Luo Yonghao first gained fame for his humorous and engaging lectures at New Oriental. Whether students learned anything was secondary; his skills in storytelling were honed during this time. After leaving New Oriental, he founded Niubo.com, which thrived during the era of personal blogs. However, blogs eventually lost out to Weibo, leading to the downfall of Niubo.com. Luo Yonghao's most famous entrepreneurial experience is undoubtedly his founding of Smartisan Technology, where he has repeatedly risen from bankruptcy rumors to continue fighting. Even I, as a bystander, am moved by his resilience. Although he ultimately could not defeat his competitors and his plan to acquire Apple was indefinitely postponed, Luo Yonghao has made significant contributions to the development of smartphones.
 
The Vaping Industry is Being Set Back at Its Inception

Luo Yonghao is now venturing into a completely new field: the vaping market. Recently, some of my friends have switched to vaping, primarily for cost savings. Many places only enforce smoking bans on traditional cigarettes, leaving vaping devices unregulated. They also claim that vaping is not harmful to health, which sounds dubious to me. How can inhaling something into the lungs be harmless? Indeed, the "315 Gala" on March 15, 2019, completely unveiled the mask of vaping, exposing many brands for serious non-compliance and greater harm to the human body. Many regions are already moving to regulate vaping devices. Just as Luo Yonghao was about to step into the vaping market, this door was heavily shut, which is regrettable. However, recent reports indicate that Luo Yonghao has not given up on the vaping market.

The Market Size is Huge, and Luo Yonghao is Reluctant to Give Up

Why is Luo Yonghao so determined to persist in the vaping market? First, it is undoubtedly due to the enormous market size of vaping. According to data, the global vaping market sales reached 12 billion yuan in 2017, and this figure skyrocketed to 15 billion dollars in 2018. The Chinese market accounted for only 6%, far lower than the United States' 43.2%, the UK's 12.7%, and Italy's 6.9%. Given China's vast population and number of smokers, the potential of the Chinese vaping market remains immense. In 2018, China produced over 90% of the world's vaping devices, but domestic sales accounted for only 6%. These two points clearly demonstrate that the current vaping market in China is just the tip of the iceberg. It is worth noting that the most profitable company in the country is not Alibaba or Tencent, but China Tobacco Group, which paid over 100 billion yuan in taxes in 2018.

If even a small portion of traditional smokers can be converted to vaping users, the Chinese vaping market will experience exponential growth. Vaping manufacturers need to continuously convey the idea that using vaping devices is healthier and cheaper than traditional cigarettes. However, years of hard work have been undermined by the "315 Gala" exposing various issues due to insufficient hard power. For vaping to regain public trust, it may take some time, and Luo Yonghao can only wait for that day to arrive.