Are small and medium-sized LED lighting dealers encountering "life and death"?

Since the successful listing of Jack Ma’s Alibaba, this wave of huge changes in the retail industry, from physical stores to online stores, is hitting China.

E-commerce represented by Tmall, JD.com, Suning, etc. has achieved rapid development, and physical stores that lack competitiveness have fallen into the predicament of closing a large number of stores. This will be a big change. Physical stores will slowly reduce or even disappear. It has become an indisputable fact and an unstoppable trend.

As dealers and wholesalers in the traditional sense in the field of building materials and lighting fixtures, this article will take a look at whether they can withstand this huge impact in the future from various angles. There is nothing to say about survival of the fittest. Only time will tell whether this situation will bring hope or despair to small and medium-sized lighting dealers.

The characteristics of the lighting industry and products determine that the road to lighting e-commerce is still far away. Many dealers can still live comfortably in this soil that is about to be cultivated and upgraded, because many lighting consumers will frequent it for convenience and have to use physical stores that are lagging behind the times and inefficient.

Regardless of whether you have adapted to innovative changes or not, the real sense of crisis is right in front of you. At present, the business environment faced by lighting dealers is still severe. When large dealers encounter difficulties, they have obvious advantages in terms of funds and resources, and they may be able to count on the support of manufacturers at critical times. However, due to their poor strength, small and medium-sized dealers and wholesalers are often helpless once they encounter a crisis of trust and can only hope for an improvement in the market.

When choosing a manufacturer, swing left and right at will and have more flowers. Non-specificity will lead to poor ability to withstand market risks. Once impacted, the future survival and development prospects will be extremely grim.

Since entering 2015, after the baptism and impact of the lighting market last year, several new normals may appear in the current operating situation:

First, small profits or even no profits have become the new normal of the lighting market.

In an environment where the price of lamps is easy to fall but difficult to rise, lamp dealers generally adopt the marketing strategy of purchasing on demand, operating light warehouses, and keeping pockets safe, insisting on fast in and fast out, small profits but quick turnover. The lighting industry has bid farewell to the era of huge profits in the past, and has turned into one of the industries with low profit-making efficiency, entering an era of low profit or even no profit.

Second, the single profit model has become outdated and has become the new normal in the lighting industry.

With the rise of lighting e-commerce, lighting prices are becoming more and more transparent. As long as consumers shop around online, and by analogy from the bottom up, there will be fewer and fewer profit points in the middle. The dealer's traditional profit model of buying low, selling high, buying low and selling high to make a profit from the price difference has no longer adapted to the changes in the market situation.

Third, the exploration and application of new pricing models has become the new normal.

As the lighting market continued to be sluggish in 2014, prices continued to fall. At the beginning of the new year in 2015, an environmental thunderstorm exploded in the lighting market. Many lighting companies that did not meet the standards were shut down, causing the prices of lighting to soar. However, with the enforcement of laws in various places, Due to the lax loopholes, some companies have taken risks and continued illegal production. Production capacity has been released again, and the price of lamps has stabilized. This kind of fluctuating prices shows the extremely impetuous psychology of the lamp industry. This kind of irrational price fluctuation will definitely find a new platform among manufacturers, markets, and dealers in the future. point to explore new pricing models. The distribution of small and medium-sized lamps has no bargaining power, so naturally they will not get the cake.

Fourth, lighting e-commerce has changed the concept of lighting sales and has become a new normal.

The current lighting industry is about to enter an era of great change. The direction of change is to reduce circulation links, reduce operating costs, improve corporate efficiency, and restructure. Lamp e-commerce is in line with the changing direction of this industry.

The profit model of e-commerce not only helps manufacturers ship goods quickly, but also helps dealers and end users get benefits. It helps manufacturers form a link through logistics, transportation, warehousing, processing, and distribution to identify and prevent risks, thereby achieving mutual benefit and win-win results for manufacturers. Therefore, e-commerce is an inevitable trend in the transformation of the lighting circulation industry. Nowadays, manufacturers, dealers, and logistics companies are involved in the field of lighting e-commerce. There are currently 200 lighting e-commerce companies in the country, accounting for about 25% of the total bulk commodity e-commerce companies in the country.

Many small and medium-sized lighting dealers still have blind spots in the field of e-commerce and may face huge pressure to survive in the future. If they cannot see the situation clearly, the way out for the future is basically to close down.

From the perspective of the upstream real estate industry in the lighting industry, although the state launched a package plan to rescue the property market in March, most real estate developers still lack confidence in the future and have lowered their sales growth targets for 2015. This reflects that developers who still had greater confidence in the market recovery last year have reached a consensus this year and are becoming more and more cautious.

The entire real estate market is changing quietly, and they are facing various unclear uncertainties in the future. No policy can change the market development trend of real estate from the golden age to the silver age. The severe upstream real estate situation will inevitably affect the construction and building materials industry in terms of demand. The lighting industry has entered an era of low profits, and a consensus has been formed in the industry.

No matter large, medium or small, lighting dealers will have a hard time. But as long as we find the right methods and approaches, I believe we can still achieve good development. Otherwise, the anger towards spring is enough to cause an avalanche.

How can we keep the rhythm right? There are always more solutions than problems. How can darkness weld the galaxy of souls? The first is to seize historical opportunities. China has a large population and a large market. After entering the Internet era, the average time online per person exceeds 5 hours/day, which provides basic convenience for new business models and new product displays. Any micro-creative or small product will have the opportunity to expand the cake and expand its store as long as it seizes the pain points of users. This kind of mobile Internet-style micro-marketing effectively connects the company's brand and the dealer's reputation, and the entire terminal demand will be naturally activated.

Secondly, dealers must transform from "traitor" traders into service providers to earn money from services. For a long time, lamp dealers have followed the traditional business method of buying low and selling high. However, under the current situation of fluctuating prices of lamps and lanterns, which are constantly unstable, the ex-factory price of lamps and the market price often appear to be "inverted". The dealer's business method of buying low and selling high is no longer feasible. A little carelessness means losses.

Therefore, dealers must change their business strategies and marketing models, transform from traders to service providers, from commodity circulation providers to suppliers and service providers, provide customers with one-stop services such as processing, distribution, warehousing, logistics, and financing, and realize their own value in the process of providing value-added services to downstream end users. To use a popular Internet saying, it means "making money for services."

Finally, small and medium-sized dealers must sort out their own profit models, and on the basis of rational use of their limited resources, firmly choose a lighting manufacturer with outstanding comprehensive strength to improve loyalty from beginning to end. You can't live in a hurry, and you can't have milk just for your mother.

Instead of regarding gaining as a goal, it is better to regard losing as an art.

Maintain long-term stable operation and orderly development. We will advance and retreat together with the manufacturers through thick and thin. In this way, while improving the reputation of your store, it will also improve your ability to resist risks. The integration of manufacturers to maximize mutual benefit and win-win also shows that the market is progressing, manufacturers are making progress, and our dealers can only keep pace with the times so as not to be left too far behind in this era of fast fish eating slow fish.

Although the current prospects of the lighting industry are not very optimistic, from the perspective of market demand, China's urbanization construction and the "One Belt, One Road" policy included in the national strategy will support the demand of the building materials industry in the long term. From the perspective of production capacity, environmental protection factors will determine whether lighting dealers can prosper in the second half of the year.

From the perspective of manufacturers, forging iron requires hard work. If a company wants to survive, its strategic decisions must be clear, and it must have environmental awareness: environmental protection will be the lifeline of the company in the future.

Faced with such a severe life and death situation, some companies still cannot turn around. Fools always think that their ideas are correct and still think that environmental protection is a gust of wind. There is no turning back. As a saying goes, breach of trust is the greatest bankruptcy. What's more, how can a country, especially the central government headed by President Xi, newly establish its authority be challenged?

If a lighting company that does not actively rectify but instead responds to rectification or continues to produce illegally is inadvertently reported, or accidentally made headlines by some media, not only the company itself, but also government officials will be involved, and the price will be even more expensive. Under the current trend of intensifying anti-corruption, "sorry for its misfortune, anger for its infighting", I believe that no government official at that level will accompany the corporate prince to study.

Flowers are still ahead, and the past can only be looked back on. In fact, no matter manufacturers or dealers, as long as practitioners in the lighting industry chain need to show great courage to face new challenges and difficulties, survive of the fittest, and dare to innovate and change, only then can we turn crises into opportunities, truly stand out from the siege, and usher in new vitality.