Zhongshan LED lighting industry interprets "Zombie line" How to break through SMEs
In the context of the poor macroeconomic environment, the differentiation of LED lighting industry has become an industry consensus.
Judging from the performance of listed companies that have already announced the three quarterly reports, the overall growth is stable. The survival situation of LED enterprises is undergoing polarization. On the whole, large and medium-sized enterprises have a good living condition, but some small and medium-sized enterprises have difficulty in operating, while some micro-enterprises are in the market competition. collapse.
Many LED SMEs even believe that the industry has now developed into the "most difficult" period. In the past, small and medium-sized enterprises relying on exports for their livelihood have realized that the competition in the LED lighting export market has become increasingly fierce this year.
In fact, since 2015, the LED industry has experienced price war competition under the background of product homogenization, and the industry is in a period of intense shuffling.
In the past two years, the Zhongshan market, which is dominated by small and medium-sized lighting companies, has also been affected by the big environment and is in a weak state. The prices of local large enterprise products are also falling, because their brands have been formed in the early stage. When the prices are comparable, everyone will believe in the brand, strength and comprehensive strength of the company.
"Now that at this stage, Zhongshan actually has a large number of enterprises, which are not competitive. It is not that his price is not low enough, but that their brand advantage is not good." The industry believes that because the product may be in the early stage At the expense of quality, it is now necessary to face the crisis of mistrust of customers.
In this case, Zhongshan’s frequent occurrences and the death of these enterprises have led to a vicious circle that has caused the entire market in Zhongshan to be sluggish.
Export volume is increasing while profit is getting smaller
Zhongshan Guzhen is the main lighting production and sales base in the country and the world. According to incomplete statistics, about 3.2 million people from all over the country come to the ancient town every year.
According to statistics from the Guangdong Provincial Department of Economic Information, at present, the town of Guzhen Town has been established as a center, and it has formed a lighting industry cluster covering over 100 billion yuan in the sales of the surrounding three cities. In the annual report of China Lighting Association, Guzhen Lighting 70% share of the lighting industry.
But the market situation in recent years is not optimistic. Despite the price increase trend of LED upstream products in the first half of the year, the order was transferred to the big factory. The small and medium-sized enterprises are in a relatively embarrassing situation, and the direct impact is the decline in gross profit margin.
“Our products are exported 90%, 80% of which are exported to Brazil. This year's export volume is 40% higher than previous years, and the profit margin is decreasing.†Talking about the export situation this year, Li Jianping, general manager of Zhongshan Hongsen Lighting Co., Ltd. mentioned .
According to statistics, from January to May 2016, China's exports of lighting products reached US$15 billion, down 10% year-on-year, of which LED lighting products reached US$6.2 billion, up only 1.7% year-on-year.
Changes in income increase without increasing profits are also forced to make adjustments in product strategies for SMEs.
Zhuo Nip's marketing director Zou Chunjiang said frankly, "This year, from the perspective of the entire LED industry, the overall market demand decline is about 20% to 30%, but as far as the AC module is concerned, the overall situation is against the trend, and this year's AC module. The sales volume has increased compared with the previous year, and the current increase will be at least 50%."
When talking about the reasons for the decline in profits, the person in charge of Zhangfei Power, which is mainly engaged in low-power drive power, believes that the current low-end LED production capacity is oversupply and the market competition is extremely fierce. In order to pull customers, some companies began to fight for services, spelling out the payment cycle, spelling the price, and spelling the lowest profit. Because the profit is very low, the book capital turnover is not much.
In addition, it is the period of the payment of goods, some of the arrears may last for half a year, or longer, which may lead to the break of the company's capital chain, so that the enterprise is in a state of ruin, if the enterprise without strong capital strength survives very much difficult.
Hu Ning, general manager of Daning Fei, said, “The situation in Zhongshan Lighting Market has been relatively weak in the past two years. Everyone is choosing low-priced products and forming a trend.â€
But for some big companies, it is another situation. In particular, the continuous growth of medium and high-end demand brings capacity bottlenecks and price increases.
China's leading LED packaging companies such as Mulinsen, Guoxing, Hongli and Jingtai are still in the stage of continuous capacity expansion.
In Wang Gaoyang, deputy general manager of Hongli Zhihui, the capacity expansion is mainly reflected in three aspects. First, the number of market demand has increased. Second, the downstream order concentration trend has resulted in a small number of packaging plants that can choose matching capacity. Third, the scaled quality and cost performance advantages are more obvious.
Wang Gaoyang, deputy general manager of Hongli Zhihui, said, “In terms of packaging market, it is expected that demand will increase by 20% in the future, and the overall price will drop by 5%, and the decline will gradually narrow.â€
The price increase of raw materials such as PCB conveys the profit compression of downstream enterprises
In recent years, rising raw materials, land, rent, labor, logistics and other costs have caused many small and medium-sized enterprises with weak competitiveness to be eliminated.
In particular, the prices of raw materials, chips and lamp beads in the first half of the year showed a round of rising prices, which made many companies whose original prices are close to the cost red line very uncomfortable.
Li Jianping said, "This year, the price of materials is also rising, especially the PCB board is up 30%. The source of the price increase of the board is mainly the upstream raw materials. It is expected to continue for a period of time, and the pressure on the company is very large."
“For the downstream customer group, the price increase of the plate will lead to the increase of the cost of downstream manufacturers.†Ding Huisheng, executive director of CITIC Group, the main PCB.
For example, in the small and medium-sized lighting enterprises listed on the New Third Board, there were 55 revenue growth of 75 listed LED lighting application companies in the first half of the year, with an average growth rate of nearly 60%. However, there are still 35 companies with a net profit decline, accounting for nearly five. In addition, the average net profit fell more than 150%.
But for large companies, scale advantages and cost control capabilities offset the negative factors caused by rising raw materials.
Wang Caixiang, general manager of Kegu Power, said, “Although the price of substrate materials has increased, our cost has increased, but we will not increase prices as power supply manufacturers. Next, we will optimize production management, design solutions, and business operations. Relieve the pressure of price increases."
Sunlight also indicated that the overall price decline of lighting products in 2016 was smaller than that of the first half of last year, and the price should be reduced by 20-30%. There should be room for price decline in the next two years, but the decline will slow down.
Judging from the fact that the three quarterly reports have been announced, the performances of large-scale factories such as Foshan Lighting and Op Lighting have also shown rapid growth in the first three quarters.
Optel Lighting's third quarterly report showed that operating income was 3.631 billion yuan, a year-on-year increase of 20.23%. Foshan Lighting expects that in the first three quarters of this year, the company achieved a total operating income of 2.575 billion yuan, a year-on-year realization of 2.232 billion yuan, an increase of 15.35% over the previous year; net profit of 280 million yuan, an increase of 281.43% over the previous year.
Rebirth companies should pay attention to product added value
Value added, no doubt means that companies need to establish their own core competitiveness.
Today's consumers need differentiated and cost-effective products. Zhongshan Guzhen lighting companies can only break through in a hostile environment with only products and brands.
“In addition to the products, we are still strengthening the promotion of the brand, enhancing the brand effect and increasing the added value of the products.†Yang Dong, general manager of Zhang Fei Power.
In the early days, most small and medium-sized LED companies were often heavy products and light services. With the continuous development of the lighting industry, LED companies gradually began to consider whether the lighting effect properly shaped the spatial form, the quantity and quality of lighting, and whether it effectively matched the operation. Whether the function and lighting have a positive impact on the physiology and psychology of consumers.
At this stage, the lighting industry has entered a new stage of service-oriented development. Each company has continuously improved its skills and service awareness and created professional brand value by meeting customer needs.
“Commercial lighting projects are not just simple sales of lamps, but require elaborate and comprehensive professionalism. These professions include lighting design, lighting design, and docking and communication with engineering project design concepts. Zhou Shui-ming, general manager of Jiamei Times Lighting, revealed.
“We have always been the industry leader in the field of product design. We are hiring professional teams to design differentiated products for different market needs.†Industry insiders indicated.
According to the relevant personnel of Sanxiong Aurora, the company's advantages are mainly reflected in four aspects. First, it is the recognition of the brand. Second, during the project, professional lighting designers are arranged to participate in the project from the early stage. The customer conducts good communication; thirdly, from the product itself, it provides customized services for customers; fourth, we have a perfect service system to solve the worries for customers.
In order to get out of the vicious circle of the industry, it is of vital importance to shape the influence of the brand. In order to go out, excellent enterprises must first build and protect intellectual property rights and patents.
It is also the key work of Zhongshan in the field of intellectual property protection to enhance the independent intellectual property protection capability and the level of infringement risk prevention.
According to Wu Kunman, deputy director of the Science and Technology Bureau of Zhongshan City, in 2015, there were 423 patent infringement cases in the city, which was twice the number of filings in 2014. It is the first in the province, accounting for 25% of the province's patent infringement disputes. Zong, the settlement rate is 103% (including the old case).
In addition, the city dispatched 1638 inspectors and inspected 423 lighting stores and factories, among which 301 were successfully settled, the mediation success rate reached 68.72%, and the mediation ended 137, involving compensation amounting to 834,400 yuan, a total of 169 suspects. The infringing enterprises were investigated and put the products under control; the central mediation was not transferred to the court for 32 cases, and 119 cases were judicially confirmed.
The substantial increase in the efficiency of intellectual property rights enforcement, effectively reducing the cost of protecting the rights of enterprises, and the ability of enterprises to legally protect their rights and interests through the use of the patent system has greatly improved. From 2011 to 2015, there were a total of 23,261 patent applications in Guzhen, with double-digit growth every year.
For the future development of the ancient town, the industrial chain of the lighting industry will be smooth, the backward production capacity will be eliminated, and the scale and special small and medium-sized enterprises will be supported. Only in this way can the lighting industry in Guzhen go well and go far.
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