The Surface + Design Event China 2019

2019.12.11-13 | Shanghai New International Expo Centre(SNIEC)

 

Building Materials Industry Into The Adjustment Period Market Downturn Is Only A Temporary Appearance

The overall performance of the building materials industry in 2019 is relatively low, even the momentum of fierce customized building materials growth has slowed down. Before the building materials industry benefited from the hot real estate, enjoy a wave of real estate downstream dividend. With the real estate into a deep adjustment period, its impact on the building materials industry will not end in the short term. But from long-term view, building materials demand is true just need: people want to pursue better living environment, want to have more personalized living space. Although the building materials industry under the environment will inevitably enter the adjustment period.

Big building materials is typical big industry small business, appear the bibcock enterprise of absolute dominant force very hard all the time. Head enterprises and small and medium-sized enterprises are two completely different ecological: large enterprises pay attention to brand publicity and channel construction, take the way of scale; Small and medium-sized enterprises are adapted to local conditions, the development of local characteristics.

Below market downbeat environment, building materials enterprise is to do addition after all or do subtractive method?

Different enterprises have different strategies. We can divide enterprises in the industry into the first echelon, the second echelon and small and medium-sized enterprises.

First of all, look at the first echelon of the leading enterprise development status. The head of building materials enterprises listed quite a lot, the head of enterprises in the face of declining growth rate to choose the strategy is to develop the “whole house” market, and integrate the resources of the building materials industry. Compared with the large-scale expansion of capacity in previous years, the whole house improvement strategy is more targeted. The second is to find new growth space to support capital’s imagination in the customized building materials industry. Head enterprises, especially listed enterprises have abundant capital, so at this time can still be active long-term market layout. From the scene of several major building materials exhibition, customized building materials is still a better industry development plate.

On the other hand, the Matthew effect of the industry is more significant, and the head brand can attract more attention from channels and consumers. For the enterprises in the second tier, the competitive pressure will increase, and the second tier brands are more focused on the concept of “whole-house customization”. It can be seen that one or two gradient enterprises are still eager to do addition, but from the strategy has been more conservative and stable, in terms of market expansion, “cross-border”, “brand alliance” and other methods of group warming are more common.

So how is the status of small and medium-sized customized building materials enterprises?

Through understanding and investigation, we have noticed that small and medium-sized enterprises are faced with two situations: one is the enterprise development is not forward-looking, suffering from environmental protection requirements and low product competitiveness, development is not good. Especially after the blind expansion of capacity enterprises are more faced with cash flow difficulties. The other is the development of the small market below the third-tier cities. The market space of the small cities is still relatively large and the competition pressure is less, and they still develop according to the old model.

From this pattern, we can see that the development of small and medium-sized customized enterprises is uneven, and the industry competition is not comprehensive. The pattern is still on the eve of subversion, with anxiety and confusion, some days are moist, and some are suffering. But in the enterprise development level is very conservative.

The adjustment that building materials industry faces at present, more resemble whole building materials industry will move toward maturity further. The mark of industry maturity is: the circumstance of asymmetry of industry information reduces greatly, production level gap reduces greatly, market pattern is stable. Such enterprise can enter more benign development, backward enterprise faces the crisis that eliminate naturally. Therefore, it is harmless for enterprises to have certain development planning and crisis awareness. Although the competition is still fierce in the second half, the whole market is undoubtedly more standardized and the development direction of the enterprise will be more clear.

Whether to do addition or subtraction, the market positioning of enterprises can not be separated from the judgment of the market.

There is no doubt that China’s consumer market is becoming more and more capable of consumption. According to hurun report, the number of mainland middle class in 2018 was about 33.214 million, and the number is expected to grow rapidly. The rise of the middle class has promoted the development of a series of domestic brands. In this process, many new domestic brands have been born.

At present, the first and second-tier cities have a large market scale and a relatively stable market structure, which is basically occupied by head brands. Third – and fourth-tier cities have a large space for the development of the sinking market, and there is still room for further integration of small and medium-sized enterprises. In this market pattern, the enterprise should not blindly do addition, but can not stop to miss a good opportunity for development. So, although there is a lot of pessimistic argument to building materials market now, the enterprise that seeks development in earnest inside course of study at present is full of expectation to the industry however.

The first echelon of large enterprises are trying to integrate the industry chain, to achieve real packaging services. It is difficult to achieve perfect results in the short term. But it is a clear direction. In addition, there are a lot of giants to cross the border, is to see the integration opportunity of this big industry. Ali increased the layout in building materials circle this year, the plan pattern of its big building materials is ready to come out.

For small and medium-sized enterprises, the current is a key period of development. Good implementation of information development, build a good reputation, help to maintain the stability of development in the sinking market. In our research, we noticed that small and medium-sized enterprises are interested in “front and rear integration”, which is also one of the current trend of customized building materials.

At present, small and medium-sized customized building materials enterprises have two problems: one is the production efficiency is not high, product competitiveness is weak; The other is the weak marketing ability of stores. Stores account for most of the gross profit of building materials, which is also of great significance for the operation and development of enterprises. The integration of the front and rear end is to integrate the front and rear end so that enterprises have stronger competitiveness. A series of building materials software is vigorously promoting the industry before and after the end of integration landing. For small and medium-sized customized enterprises, stepping out of the step of improving the level of information, for their comprehensive competitiveness is a certain help.

According to statistics, by the end of December 2018, the national furniture manufacturing industry lost 12.5%, but even so, there are enterprises with good growth. It is to do addition or subtraction after all, should adjust according to actual situation. However, the current tuyere is no longer, the pace should not be too hasty, whether large or small enterprises, in the industry, technology, services to steadily advance, for enterprises and industries are beneficial.

Compared with traditional building materials, customized building materials have the advantages of intelligent information production. With the development of software technology, the production cycle and error rate are greatly optimized, and the product style is more diversified. Overall, customized furniture is still the trend of the building materials industry, but also the engine of the era of large building materials.

Actively promoting enterprise development and industry progress is always the right direction of development. From the perspective of the market, consumers want nothing more than better products and better services. Take a step back, a market no matter good or bad, someone can make money, in the fierce competition to win the way is to adapt to the market in order to develop, should enter, should retreat.

Source: China building materials