China's furniture industry is facing a shock perio

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Domestic and foreign troubles in 2008, China's furniture industry faced a shock period

domestic and foreign troubles in 2008, China's furniture industry faced a shock period

May 27, 2008

[China paint information] 2008 is destined to be an extraordinary year

2008, China's economy was regarded by many media at home and abroad as "entering the economic period of a big country". In an era when the economy of a big country can not bring glory, Chinese enterprises, especially private enterprises, are experiencing the most severe test: the loss of "four aircraft carriers per month" caused by the appreciation of RMB, the two-way weakness between enterprises and employees caused by the increase of labor costs, export tax rebates and a series of policy changes, The rising cost of raw materials...

enterprises are tightening their funds, dealers are struggling to maintain their appearance, export enterprises are facing transformation, and the cake of enterprises in the domestic market is seriously squeezed

facing 2008, what kind of future will China's furniture industry usher in after experiencing rapid growth with an annual growth rate of more than 20% for nearly 20 years, and what fate will 70000 enterprises in China's furniture industry face? As a consulting planner who has been wandering in the furniture industry for ten years, the author believes that the industrial shock period of China's furniture industry has officially come

internal and external pressure shocks accelerated

in 2007, the gross domestic product of China's furniture industry exceeded 540billion yuan, again exceeding 25% of the annual growth rate in 2006. From 1.3 billion yuan in 1978, China's furniture industry has increased 415 times in 30 years. It has rapidly passed through the embryonic and growth period of industrial development, and has grown into the world's largest furniture exporter and furniture producer. From the perspective of the development of the industry itself, the end of the growth stage will inevitably lead to the beginning of the shock period

the external pressure began with the adjustment of export tax rebate policy in 2006. In 2006 and 2007, the state lowered the export tax rebate rate of furniture twice, from 13% to 9%. The profit margin of furniture products export is not high, and the 4% margin is already a heavy pressure on many enterprises. This is just the beginning for the furniture industry

pressure 1: the import tariff soared, and the furniture industry encountered unprecedented cost pressure.

"in the second half of 2008, the export tariff of Russian logs will be significantly increased, reaching 80 euros/cubic meter." A few days ago, tsiprakov, the Russian commercial representative in China, had a word of mouth. The news spread that China undoubtedly dropped a heavy bomb when 70% of its log imports came from Russia. It is understood that in 2006, China imported 36million square meters of timber and 21.82 million square meters from Russia, accounting for 70% of the total imports. From 2000 to 2006, Russian timber accounted for more than 50% of China's total timber imports

pressure 2: raw materials are rising, and profit margins are squeezed

statistics from manufacturers, timber circulation associations and other institutions show that the price of domestic timber has increased by more than 15% this year. Since October alone, the price of imported timber has increased by about 20%, while the price of domestic timber has generally increased by 5% ~ 8%...

in addition to the obvious rise in the price of timber, hardware accessories as another main material of panel furniture, The price of materials has risen alarmingly, among which the increase of zinc alloy has exceeded 350%, reaching 38500 yuan/ton. Therefore, the price rise of overall hardware accessories is inevitable. In addition, the prices of raw materials such as coatings and adhesives have also accelerated since the end of last year. In addition, the rising electricity and freight costs have led to a sharp rise in furniture production costs

the price of imported plates also increased significantly. Compared with the same period last year, the prices of imported log materials from Brazil, Africa and Southeast Asia generally increased by 20%~30%, and some countries also banned log exports. The price of egger board in Germany was raised by about 15% last year, and will be raised again at the end of this year, with a range of about 10%~15%

pressure 3: real estate shocks, furniture downturn development

although the U.S. subprime mortgage crisis will not have much impact on China's economy, it has not only broken the myth that mainland real estate mortgage loans are high-quality assets. The tight monetary policy has changed the environment for the rapid development of the mainland real estate market before 2007. Whether the credit scale is tight or the interest rate rises, it will have a greater impact on the real estate market

the furniture and building materials industries that used to take advantage of the real estate industry will inevitably be impacted

pressure 4: the appreciation of RMB and the evaporation of profits

in March alone, the US dollar fell by 2.6% against major international currencies. Assuming that 90% of China's foreign reserves are in US dollars, US $35.7 billion has evaporated in the past month, equivalent to four times China's trade surplus in February. Songhongbing, the author of currency war, said that this is equivalent to that China has sunk four aircraft carriers every month, and there must be victims of the furniture industry in the sunk aircraft carriers

the arrival of the shock period has brought the market competition into a squeezed state

from the perspective of the life cycle of the furniture industry, which is not only from the fundamental transformation of the plastic granulator process, but also from the perspective of the life cycle of the furniture industry. The life cycle of the furniture industry is divided into the embryonic period, the growth period, the shock period, the mature period and the recession period

2008, China's furniture industry will enter a period of shock, the explosive growth will end, the market competition will intensify, the plundering of industrial resources will intensify, and the growth of enterprises will enter a state of slow growth or decline. Market competition will be squeezed

the competitive situation requires furniture enterprises to quickly complete the business transformation and network layout in the past two years

there are four performances in the shock period:

first, furniture export enterprises switched to domestic sales and plundered the market cake

in 2007, China's furniture exports reached 22.6 billion US dollars, accounting for 40% of the country. The total domestic sales of furniture reached 377billion yuan, of which the domestic sales of furniture in Guangdong Province alone reached 95.5 billion yuan, an increase of 32.64% over 2006. The growth rate in the domestic market is enough to see that the transformation war of Guangdong enterprises is in full swing, and this is enough to constitute the second "wolf" for the domestic market! If Guangdong enterprises hold up the banner of "Northern Expedition" in the market, or unite or fight alone, this will bring great pressure to the domestic furniture market

II. The strategy of big media and big advertising is highlighted to compete for the first camp of brands in the furniture industry.

since 2006, the CCTV brand building group led by Quanyou has been born in the furniture industry. In fact, the advertising of furniture brands on CCTV began in the late 1990s. In today's society, most of the main delivery methods are suits and columns, with poor time period, low price and less frequency. At present, the investment at this stage is much bolder and more heroic. In the year, the investment quota of individual enterprises has exceeded 100 million. In particular, this year, Shuanghu took the lead in launching the CCTV bidding section advertisement. Taking this as a starting point, it will set off a new situation for the CCTV launch of furniture enterprises

this launch strategy is related to the vacancy of the first camp of brands in the furniture industry. I divide the brand marketing of furniture industry into three stages

first stage (), the primary stage of furniture brand management. This stage is characterized by "low investment and high return". As long as we find the right positioning, we can win the market

the second stage (from 2006), the intermediate stage of furniture brand management, will be a period of "high investment and high return"

the third stage (future), the advanced stage of furniture brand management, "high investment, low return" will finally come

III. from the competition in the primary market to the competition in the secondary and tertiary markets

in August 2007, Shenzhen Furniture Industry Association and 8 Shenzhen furniture enterprises jointly initiated the establishment of "Shenzhen furniture brand alliance". The first battle of the alliance is to go out to the secondary and tertiary markets

according to the national economic operation statistics of the National Bureau of statistics in the first quarter, the total retail sales of domestic consumer goods in the first quarter was 2555.5 billion yuan, a year-on-year increase of 20.6%, which was widely used in the fields of automobiles, household appliances, pipes, packaging, etc. In the wholesale and retail trade above the designated size, furniture, cars, petroleum and products, gold, silver and jewelry all increased by more than 30%. Furniture consumption growth is significantly higher than the average consumption growth rate, indicating that the potential of the furniture market is very large. Furniture consumption has always been combined with the real estate market. Now the domestic real estate market is already developing to the second and third tier cities. It can be predicted that the furniture market is bound to have explosive growth in the second and third tier markets

seeing such a market space, Shenzhen furniture launched a joint campaign, and the famous brands led by Bluebird furniture in the north also set the secondary and tertiary markets as the next strategic development focus

IV. from a highly consistent development model to a development model based on enterprise resources

in the extensive growth period, many furniture enterprises have the same development model. In the shock period, enterprises are not only fighting for capital, products, but also strategies and brands! Therefore, each enterprise should take stock of its own resources and establish its own development model

the enterprises that have defined the development mode in the growth period have really come to the front of the times. For example, the marginal growth mode of Qumei furniture (see the map), the franchise business mode of Shuangye furniture, the needle attack growth mode of top 100 furniture, and the high value-added product business mode of a small group of Sihai furniture

advance into shock and harvest maturity

the shock period is the most critical period for the development of furniture enterprises. The shock period will bring four results:

first, more fierce domestic market competition

II. The emergence of super brands in the furniture industry (from industry brands to social brands)

III. change from price war to brand and value-added competition

IV. exploration of industry development mode

we expect more enterprises to bravely enter the industry shock period; We look forward to the birth of more vigorous brands; We look forward to the infinite value created by China; We also expect that, in the experience of this era, China's furniture industry will usher in a new pattern of maturity, order and vitality with a steady development speed and a transcendent development mode

Copyright © 2011 JIN SHI