At present, lighting dealers are facing the pressure of shrinking market profits. The growth of terminal channels and the flattening of channels have made dealers feel crisis and trouble. Therefore, dealers are trying hard to decompress, although many times they feel powerless, but still To find their own way to release pressure, some transform into other areas or implement diversified operations; some begin to build their own brands and enter the production field; some also strongly develop terminals. In the end, what kind of measures are most effective, so that dealers who are under pressure can be freed? The author recently visited the owner and related person in charge of some lighting markets in Taiyuan on this issue.
1, the pressure is heavy
In the context of the strategic transformation of producer channels and the emergence of terminal hypermarkets, dealers as “trunks†are faced with not only “roots†(producers) instability, but even “twigs†(terminal retailers). Shaking up, the market's uncertainty and uncontrollability have increased significantly, which has led to a decline in the ability of the traditional dealer community to play the game market.
According to the investigation by the reporter, the current pressures faced by Taiyuan dealers are: 1. The price increase of raw materials makes the price of upstream manufacturers increase; 2. The increase of employee wages and management expenses (the average increase of one storefront requires the recruitment of 5 employees, the salary of the old employees) 35% increase per year); 3, store rents rise (the average increase in the facade of the modern decoration world is 10%); 4, the competition between brands is fierce, the price war continues; 5, the promotion, after-sales service costs increase; 6, the market expansion , the new brand, the merchant's presence; 7, the pressure of the manufacturer's sales policy to the merchant (repayment policy, rebate policy, etc.).
According to Wang Yongsheng, general manager of Sanyi Personality Lighting in Taiyuan City, although the Shanxi market is starting late than other markets, the development speed is quite fast. At present, there are nearly 10 lighting stores in Taiyuan. The market is constantly moving towards the help of many merchants. Maturity. First of all, the brand began to concentrate, and the phenomenon of good brand concentration is more obvious. Now, “NVC†is concentrated in the Yellow River lighting, gradually forming scale, and its influence is continuously expanding. Secondly, the market share of products is relatively concentrated. Once the brand has exerted influence, Its market will continue to expand, which will inevitably have a certain impact on other brands, especially small and medium-sized brands.
The decline in operating profit margins has become the most direct and painful pressure on lighting merchants. Excessive competition in the market has led to a constant increase in the cost of sales and expenses of dealers. The only thing that was earned was the “price difference†and “rebateâ€, and the lighting merchants were distressed by the meager profit margin. Especially in the case of hypermarkets and on the premise that price wars are the main means of competition, many dealers are worried about tomorrow's "living". Fan Wenli, general manager of Shanxi Mingguang Industrial Co., Ltd., told reporters that they used to have a storefront in the modern market of Taiyuan's largest market. However, for various reasons, only one can be withdrawn from the market. The main reason is that the market is close to saturation. In the state of Taiyuan market, the number of merchants in the market is growing at a rate of 30% per year. The decline in profits has brought them a lot of pressure. Therefore, they are trying to find a development path that suits them and start the operation mode of the store to adapt to the ever-changing trend. City often
2, the pressure comes from itself
Lamp dealers, especially traditional merchants, have generally felt tremendous market competition pressure since this year. However, this does not mean that the “cake†of the lighting market is almost finished. In fact, for most merchants, the market is still open, but compared to the past, merchants now feel the pressure. Faced with these pressures, how should dealers recognize the concept?
There is pressure. Although the demand in the market is constantly growing, there are more businessmen joining the market. According to a well-known marketing person in the lighting industry, in China, lighting companies are mostly SMEs, that is, the lighting industry. Sales are below 300 million or the total assets are below 400 million. These companies have limited capabilities in terms of capital, manpower, technology, and channels. In particular, companies with full self-built marketing network capabilities are minimal. Therefore, the lighting manufacturers have not yet had the strength to integrate the national market channels, and can only cooperate with more merchants to obtain more lucrative profits, and the lighting market cake will become bigger and bigger. In addition, China has a larger rural market. If the price of lighting (lighting) products is reasonable, and it can meet the needs of rural families, farms and other users, grasp the ideas, and make timely dredges of downstream channels, so that the diagnosis can be confirmed. The correctness of your own business ideas, and make appropriate strategic adjustments to capture greater profit margins.
In addition, the degree of subdivision of lighting products is also more obvious. According to Guo Quansheng, general manager of Taiyuan Branch of Chenhui Guangbao Technology Co., Ltd., Chenhui products are now being subdivided, what kind of products will go in what kind of channels, some focus on the home field, and some directly face engineering. These products are continuously applied to supermarkets, office places, home improvement companies, and so on.
Therefore, the lighting dealers should effectively respond to the market, find the selling point, reach a consensus on the concept and the manufacturer, and constantly change the business ideas, make strategic adjustments in a timely manner, in order to truly "decompress". The business elites under the current situation channel will not sit still and can only follow the trend of the times and constantly change the style of play. It is the dealers of lamps that need to know from the concept.
3, change pressure as power
Under the new market changes, if the lighting dealers can grasp the development direction of the market and first agree on the concept, such new lighting dealers will follow the trend and continue to become a rising new force. New dealers must have their own core competencies, so that pressure becomes a driving force before they can “explodeâ€.
According to Qiao Jianguang, general manager of Taiyuan Jindi Lighting, most of the merchants in the lighting market are not optimistic this year. Many dealers say their business is not as good as one year, the number of dealers is increasing every year, and the store rent is also every year. Rising, market competition is intensifying, they are helpless in the face of fierce competition, merchants with good business have peace of mind, and those who are not good are resentful. In fact, most of the merchants have not been freed from the invisible pressure, and the pressure is the driving force, which is the best solution.
If the lighting dealers want to expand the market and maintain a strong growth momentum, they will not be able to have their own advantages. Their advantage is called “core competitivenessâ€. According to the advantages of the merchants, the core competitiveness of the merchants can be located, mainly in the network channel replication capability, the engineering channel's public relations capability, internal management capability and sales service capability.
According to Joe, the "network" and "channel" are not unique to a merchant, nor can he retain it. Although Jindi Lighting started late in Taiyuan, they have strong network replication capabilities. A product, a brand in any region of the channel, outlets and even channel models can be easily imitated and copied, and there is no legal constraint, all "things are artificial."
The development of the engineering field is actually an accidental “outbreakâ€. This first requires the lighting distributor itself to have the information capture capability. Only the existence of the project has the need to fight for it. Liu Jie, general manager of Seiko Century Lighting, said that their store is mainly based on crystal lamps and modern lamps. The products are of high grade and the price is much higher than the average products. Therefore, retail can not meet the competition requirements of the store, so collect engineering information. And proper PR is the most effective means of competition.
Furthermore, service capabilities, especially after-sales service capabilities, are an effective guarantee for returning customers. Some merchants are selling lure products, but it is better to say that they are selling intangible services and services, and the products are naturally not sold.
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