Luo Baihui: Hardware industry may usher in high-speed shock period

China's hardware industry has maintained a high-speed development trend since the 1990s. At present, it has become an important hardware product country in the world. Luo Baihui, secretary-general of the International Die & Metal & Plastic Industry Suppliers Association pointed out that China's hardware industry is engaged in product development and innovation. , brand management, marketing management, business size, financial strength and many other aspects and the world's well-known hardware companies have some gaps. However, I believe that through the joint efforts of all parties, these difficulties can be overcome and resolved. At present, China has formulated a phased development plan: by 2015, the level of hardware manufacturing will increase significantly, and some industries will enter the international advanced level; by 2020, the hardware manufacturing industry will reach the international advanced level as a whole. China's hardware products industry has great potential for development and a broad market prospect. Related hardware companies should be brave enough to meet the challenges, seize market opportunities, and develop with the industry!

1. The rise of China’s hardware manufacturing center

With the acceleration of China's integration into the global economic environment and the rapid rise of its economic strength, China has become the most dynamic economic region in the world. China's economic facilities are relatively complete, its industrial development is relatively mature, and its labor cost is low. It has become a global hardware manufacturing center. With its comparative advantage, the outward development of the hardware manufacturing industry has obvious features.

The strengthening of the status of the center was first manifested in the overall growth of hardware product exports in recent years: the growth rate of the export of major hardware products was higher than the growth rate of production, higher than the growth rate of sales in the domestic market; the major hardware and electrical products were fully developed, not only Electric tools, hand tools, and architectural hardware products have a large increase in the number of traditional export products.

Moreover, the export growth rate of kitchen electric products and sanitary ware products with a relatively small proportion of exports in recent years is also very obvious. The huge market and central position attraction will further attract the transfer of manufacturing centers of hardware multinational companies to China.

2. Industry capital operation is becoming more active

In an environment of global competition, industrial capital is another subject of industry operations in order to obtain a favorable competitive position and improve competitiveness. Supor, Vantage and Hongbao have been listed in the industry. The operation of Wanhe’s capital market will not be stopped due to the failure of restructuring with Yuemei. From a capital perspective, the current main feature is that the expansion of capital is intensifying. From the perspective of competition behavior, The cooperation of resource sharing among enterprises is increasing.

3. Intensified polarization of hardware companies

The next few years will be the high-speed oscillation period of the hardware industry. The direct result of this high-speed shock is the expansion of the polarization trend in the current hardware brand camp. It is expected that the hardware companies that can really survive in the market in the next few years will definitely not be so much now. However, this high-speed oscillation in the hardware industry will bring huge opportunities. The result of the shock will make the market operation more rational.

4, the increasingly fierce competition in sales channels

Due to oversupply of domestic hardware and kitchen products, increased quality pressure, and sales channels become one of the key competition factors, the competition for channels among all parties is becoming increasingly fierce. On the one hand, kitchen power manufacturers have strengthened control over retail terminals and strive to reduce sales. In order to save sales costs and make sales channels more professional, the company's sales model is developing in a direction that can adapt to multiple markets at the same time.

On the other hand, the development trend of the sales industry has led to the continuous rise of the status of large home appliance chain stores and increased control over the industry. Participation has led to price competition previously dominated by manufacturers, with large retailers relying on their broad market coverage and procurement. With scale and cost advantages, the ability to control production companies will be increasingly strengthened in terms of product pricing, payment of goods, etc. At the same time, the requirements of the international market for China’s hardware products will gradually evolve and change. The quality, packaging, and delivery period of Chinese products will be improved. All will have higher requirements, and even gradually extend to the research and development of production processes and products, combining products with environmental protection, energy resources, and the human environment.

5. High-quality, high-tech products are competitive

With the deepening of competition, the profit space in all stages of the hardware industry chain is being compressed, and the space for price reduction is declining. More and more companies realize that it is not the long-term development direction to strive for the establishment of core competitiveness by price competition alone. To explore new development paths, many hardware companies have increased their investment in technology.

Develop new products with high technology content, take product differentiation as a long-term plan for enterprise development, seek new market demand, establish new economic growth points (into small household appliances and other similar industries) to realize the sustainable development.

6. Domestic and foreign enterprises accelerate convergence

In order to increase its own strength and expand the international market faster, domestic hardware companies will accelerate the integration with foreign companies through various means to improve product quality and competitiveness, while continuing to expand markets in the United States, Japan and other traditional countries, and in Southeast Asia. The Middle East, Russia, Europe, and Africa will also fully bloom.

The next few years will be the high-speed oscillation period of the hardware industry. The direct consequence of this high-speed shock is that the trend of polarization in the current hardware and kitchen brand camp is expanding. It is expected that the hardware companies that can survive in the market in the next few years will definitely be absolute. Not so much now, but this kind of high-speed oscillation in the hardware industry will bring huge opportunities. The result of the shock will make the market operation more rational. Luo Baihui, secretary-general of the International Mould, Hardware and Plastics Industry Suppliers Association, said that China’s hardware industry will continue its momentum of structural adjustment, but at the same time, some bright spots will continue to appear. The polarization of hardware companies will intensify, and some companies that do not meet market competition will Through different channels to exit the market competition, and hardware giants will gradually surface.