Multinational home marketing fell into the deep valley

The home industry is now experiencing an unprecedented crisis. China Building Materials Circulation Association recently announced the latest industry sentiment index. From January to June 2012, the sales value of enterprises above designated size in the national building materials industry was 2.5 trillion yuan, a year-on-year increase of 16%, and the growth rate dropped sharply by 25.2 percentage points. Among them, the sales of home building materials above designated size reached 553.93 billion yuan, a year-on-year decrease of 7.66%, which is the first time in the past five years that the growth rate has declined. According to statistics, since August 2011, there have been 12 home building materials stores in Beijing, and five other stores are preparing to move or withdraw. Local home building materials store Oriental Home, Real Home, Red Star Macalline, etc. are also in the "hot and hot".

At the same time that local homes are in trouble, the days of foreign homes are even worse, and they have lost China. A few years ago, foreign-funded enterprises also happily came to China to sprint, and most of them have now retreated. On September 13, the US's second-largest retailer and building materials giant Depot suddenly shut down all its stores in China, claiming to carry out "significant strategic adjustments." On September 19, B&Q, the largest company in Europe and the world's third largest home building materials retailer, was accused of arrears with suppliers. The well-known Swedish household goods retailer IKEA has recently fallen into a low-price strategy whirlpool due to the “agent incident”.

Internal and external due to water and soil dissatisfaction

According to statistics from China Building Materials Circulation Association, in the first eight months of this year, the cumulative sales of building materials and home appliances above designated size nationwide was 779.2 billion yuan, down 6.84% year-on-year. The reason is that on the one hand, the property market purchase restriction policy has restrained part of the investment demand; on the other hand, the rigid demand in the face of rebounding housing prices and strict regulation, the performance is somewhat "tangled", many people hold a wait-and-see attitude.

Wang Yijun, an adviser to the management of the International Financial News, said in an interview with the International Finance News that, first of all, the economic downturn has made the entire home furnishing industry sluggish, including domestic-funded home furnishing companies such as Red Star Macalline. It is understood that Red Star Macalline is currently in the transformation of other businesses, not limited to the building materials industry. In addition, the government's regulation of real estate is also the biggest reason that affects the building materials industry. “Because in China, foreign investment is relatively high in itself, and the impact of the high level is that once people reduce consumption in this area, these high-end enterprises will take the lead in reducing, and thus the market will be cold. problem."

Wang Yizhen told reporters that for domestic consumers, the development model of the foreign building materials industry itself has certain problems. “Their model may be well developed abroad, but it is not suitable for the Chinese market.”

“The forms of IKEA, B&Q, Home Depot and other foreign-funded enterprises that encourage building materials supermarkets may not be suitable for survival in the Chinese market. Chinese people do not like to choose when they consume large-scale products. They also hope that some people can give some suggestions and recommend them to suit themselves. The products, as well as post-sales, door-to-door installations, etc., and IKEA does not encourage on-site installation, so this is very different from the foreign market situation." Wang Yizhen said, in contrast, the domestic traditional home store one-stop service It is more advantageous and more suitable for the habits of Chinese consumers.

In the view of Fu Zhiyong, a partner in the policy management consulting business, there are two main reasons for the withdrawal of the foreign building materials industry from the Chinese market, namely, its own model problems and the market decline caused by the slowdown in economic growth. “For example, Home Depot, its own model is not suitable for Chinese consumers, and it has long been acclimatized in China, but the reason for its withdrawal from the Chinese market is that the demand for the entire building materials market in China is slowing down. In the long run, coupled with its own model problems. So that Home Depot can't see hope, and finally choose to withdraw from the whole line. Model problems will affect market share. If the industry grows faster, the overall sales volume will increase, but now the mode is low, which makes the industry show a huge decline. At this time, you must consider exiting."

"Transfer" is the key point of breakout

The foreign-funded home building materials market is cold, and may bring a short-lived "spring" to the domestic building materials market. Wang Yizhen told reporters that the gradual withdrawal of foreign brands has given up a certain space for the entire home building materials market. Domestic companies have created opportunities, but for this reason, domestic home furnishing companies must challenge this market. In such an environment, it may not be realistic to achieve high-speed expansion, but stable growth is a better choice, that is, to ensure the vacancies of exiting the market while ensuring the health of its own operations. In the low tide period, the market is first occupied to support the rapid growth and expansion in the future. At the same time, we must also do a good job within the company to ensure stability, such as internal management, supply chain and so on.

"It may not be a spring." Fu Zhiyong said that the market share of the multinational building materials industry itself is not large. After the foreign-invested building materials industry withdraws from the Chinese market, it is not enough to make up for the shrinkage of the entire industry market. Therefore, for the domestic construction materials industry, it may not be a "spring" for market growth. However, the lack of competition from these foreign giants should be more conducive to the formation of leading brand status in China's domestic building materials stores. This is a strategic embodiment.

"If the domestic home building materials industry wants to stand in the Chinese market better, it needs to consider the layout of the enterprise from the experiential consumption and after-sales service. How to combine the department store industry and the building materials industry organically, so that the people gather together and quickly Building a leading position in China, when foreign-funded enterprises enter China again, they can have enough ability to compete with them." Fu Zhiyong told reporters.

In the face of difficulties, operators of building materials and home stores have stepped up their efforts to expand into second- and third-tier cities. In addition to shifting positions, shifting target customers is a bigger change. Some insiders analyzed that for the building materials and home furnishing industry, the construction of affordable housing is actually a big cake. In addition, commercial housing development is increasingly inclined to provide hardcover and finished rooms. The purchase and renovation of materials for these houses is carried out by the builders, and the number of home stores that have a share of them is currently small.

Some experts pointed out that when it comes to individual customers, most of the home stores rely on the rent of merchants to live. For group customers, they are required to establish their own distribution systems and logistics systems. If we adapt to this change, building materials and home stores will be able to gain long-term development space in the process of urbanization in China. The Beijing Finance Bureau issued a notice on the website a few days ago to start a public bidding for the “Furniture Replacement Pilot” and will determine no more than six furniture sales companies. If this policy is promoted, it will undoubtedly ease the pressure on the building materials and home furnishing industry.

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