I. Industry Risk Analysis

(1) Policy Risk

In the insecticide industry, on the policy – making end (legislative stage), new regulations on environmental safety and health protection are being introduced at an accelerated pace. Pesticide residue standards are continuously tightened, and highly toxic products are gradually being added to the elimination list. On the policy – implementation end (regulatory stage), the intensity of environmental protection inspections has increased, the approval cycle for production licenses has been extended, and the mandatory proportion of biological pesticides replacing chemical ones is gradually rising. On the policy – adjustment end (revision stage), there is pressure to comply with the new list of controlled substances in international conventions (such as the Stockholm Convention). Some traditional ingredients face the risk of being banned, and the research and development of substitutes is restricted by the 3 – 5 – year review cycle for new compound registrations. Entrepreneurs need to be vigilant against the triple – policy superposition risks of the sudden invalidation of existing formulas due to standard iterations, a sharp increase in environmental protection transformation investment for production lines, and international orders encountering green trade barriers.

(2) Economic Risk

During the economic downturn cycle, the insecticide industry faces the risk of reduced agricultural investment and tightened procurement budgets. Farmers and dealers may delay or cut procurement, resulting in a temporary slump in market demand. Raw material prices are affected by the fluctuations in the energy and chemical industry chains, combined with global inflation pressure, which makes it more difficult for enterprises to control costs. Small and medium – sized enterprises are prone to cash – flow shortages. As environmental protection policies continue to become stricter, the investment in compliance transformation and the research and development of alternative products increases, and the pressure on technology iteration for start – up enterprises intensifies. Industry leaders compete with low prices by virtue of their scale advantages. If new entrants lack differentiated products and channel resources, they are easily squeezed out of the survival space.

(3) Social Risk

The insecticide industry is facing social risks caused by the conflict of inter – generational consumption concepts. The young consumer group has an upgraded demand for environmental protection and health and resists traditional chemically synthesized products, forcing the industry to transform towards biological agents. However, the price sensitivity and usage inertia of middle – aged and elderly users create a market gap. Social media amplifies the controversy over product toxicology. The “ingredient – conscious” Generation Z promotes stricter supervision, and the compliance costs of enterprises surge. At the same time, the inter – generational cognitive differences lead to a brand trust crisis. The technological path dependence of established manufacturers is misaligned with the value propositions of the new generation of users. Entrepreneurs not only bear the pressure of green R & D investment but also face the risk of imbalance in the reach efficiency of the traditional channel distribution system and the emerging e – commerce platforms to different inter – generational consumer groups.

(4) Legal Risk

The requirements for environmental protection and production qualifications are becoming stricter. If entrepreneurs fail to obtain pesticide registration certificates in time or their environmental impact assessments fail to meet the standards, they will directly face the risk of business suspension. Product ingredient labeling and advertising must strictly follow the “Regulations for the Administration of Pesticides”. False advertising or over – exaggeration of efficacy can easily trigger high – value fines. The newly issued list of banned ingredients is updated frequently. Omissions in supply – chain management will lead to criminal risks of illegal addition. The regulatory authorities conduct “double – random” spot checks regularly. If production records are not well – preserved or there are negligence in the management of hazardous chemicals, enterprises will be punished to the maximum extent. The industry access threshold and the cost of violations are increasing exponentially.

II. Entrepreneurship Guide

(1) Suggestions on Entrepreneurship Opportunities

For the current insecticide industry, three major opportunities can be focused on: the research and development of biological pesticides, the niche market of home gardening, and precision pesticide application technology. Develop environmentally friendly products with microbial agents/plant extracts as the core, launch ready – to – use safe insecticide sets for home green plants/urban agriculture scenarios, and design intelligent pesticide application equipment (such as a temperature – and – humidity – sensing automatic spraying system) in combination with the Internet of Things technology. At the same time, pay attention to the research and development window for substitutes in the list of banned substances in the EU REACH regulations. Reach small and medium – sized farmers quickly through the model of agricultural materials e – commerce + agricultural technology live – streaming, and promote customized solutions in cash – crop areas with serious drug resistance (such as protected vegetables).

(2) Suggestions on Entrepreneurship Resources

Entrepreneurs in the insecticide industry should focus on integrating the following resources: First, obtain the patent technology of environmentally friendly products or cooperate with scientific research institutions to develop low – toxicity and high – efficiency formulas to ensure technological compliance and differentiated competitiveness. Second, establish a stable cooperative relationship with upstream chemical raw material suppliers to secure raw material channels that meet national environmental protection standards and reduce the risk of production cost fluctuations. Third, take advantage of the policy dividends of rural revitalization, connect with agricultural cooperatives and plant protection stations to build a distribution network, and at the same time build an online agricultural materials e – commerce platform to reach end – users. Fourth, strive for special subsidy funds from local governments for green pesticide projects, and jointly design supply – chain financial service solutions with financial institutions to relieve cash – flow pressure. Fifth, form an operation team with an agronomic professional background and channel resources to strengthen the product technology promotion and after – sales service capabilities.

(3) Suggestions on the Entrepreneurship Team

When forming an entrepreneurship team, it is necessary to ensure that the core members include experts in the fields of pesticide chemistry or bioengineering to control product research and development. A regulatory specialist familiar with the “Regulations for the Administration of Pesticides” of the Ministry of Agriculture and Rural Affairs and international EPA standards should be equipped to avoid compliance risks. Market operation talents with resources in agricultural cooperatives and channel dealers should be introduced to quickly establish a distribution network. Team members should form an “R & D – regulation – market” triangular cooperation mechanism, regularly iterate formulas based on field experiment data and adjust marketing strategies synchronously. Key technical personnel should be bound by equity to prevent the risk of formula leakage.

(4) Suggestions on Entrepreneurship Risks

Entrepreneurs should first complete product compliance certification, focusing on the latest requirements of the “Measures for the Administration of Pesticide Registration” of the Ministry of Agriculture and Rural Affairs to ensure that product toxicology testing, environmental assessment, and residue standards fully meet the requirements. A regional pest database should be established to develop precise formulas for different crop belts and avoid homogeneous competition. When signing exclusive regional agency agreements with agricultural materials dealers, market capacity guarantee clauses should be added. For raw material procurement, a “3:4:3” inventory strategy (30% locked at long – term contract prices, 40% hedged through futures, and 30% as spot for flexibility) should be implemented to deal with the price fluctuations of raw materials such as glufosinate – ammonium. An agricultural technology service team should be formed, and two plant protection specialists should be allocated to each county in major agricultural provinces such as Shandong and Henan to bind users through technical services. Special attention should be paid to the improvement of the adaptability of unmanned aerial vehicle (UAV) pesticide application scenarios, and low – foaming and anti – drift formulations should be developed to seize the incremental market of UAV – based pest control.