Something happened to me and I am here! In 2016, LED companies should live like this

A few days ago, Fang Hongbo, chairman of Midea Group, said in an interview with the media: "In the new year, we will face a more brutal competitive environment and market situation. In such a context, only by changing can we cope with rapid changes; only by changing, can we cope with rapid changes. Only by changing can we face more brutal competition; only by changing can we seize the opportunities that the times have given us; only by changing can we rise against the wind and stand out.” I think this passage is also applicable to our LED industry, especially in the current era of price wars.

As we all know, since last June, Absen, which has always taken a high-end route, changed its past style and broke the news of a 50% price cut on its cabinets. Enterprises such as Easystar, Powerful Power, and Huaxia Guangcai have also launched price reductions, triggering a large-scale price war. Some small and medium-sized enterprises that relied on price advantages to survive had to end up in bankruptcy. Since the New Year of 2016, the growth rate of the LED display industry has slowed down and market demand has cooled. Coupled with product homogeneity and overcapacity, the price war is likely to become more intense. Then, when the next wave of price wars comes, we need to change the development strategy of the enterprise. Whether it is products or industrial structure, I will change and I will survive.

First of all, there is no doubt that innovation must be the purpose of product production. First, enterprises must increase capital investment, increase research and development of new products, and increase product added value; second, they must make technological breakthroughs and innovations, form their own characteristics, and build their own core competitiveness.

Secondly, focus on market segments. The LED display industry has a long industrial line. According to the type, it can be divided into special-shaped screens, transparent screens, rental screens, etc. According to the environment, it can be divided into outdoor, indoor and semi-outdoor. Therefore, if you design products according to needs, be professional; provide design solutions according to the environment and be segmented; install products as required and provide good services. Small and medium-sized enterprises do not seek to become bigger, but seek to be specialized, detailed, deep and good, and pursue high added value.

At present, there are too many enterprises. In the current situation of overcapacity in the entire industry from production, sales to engineering, survival is the most important thing. Therefore, according to the characteristics of the enterprise, being professional in the segmented fields is the way for enterprises to survive the "price war".

Finally, the strategy shifts and looks for the next outlet. Small and medium-sized LED companies often do not have the ability to compete head-on with large companies. They can only implement strategic shifts to avoid their edge, survive in the gaps in the market, and even gradually grow. Strategic transfer includes the transfer of product areas and market channels as well as the expansion and cross-border of industries. In this regard, display screen companies such as Ledman have expanded their industrial fields into the fields of culture and sports. In this way, the overall safety factor of the company is relatively high and is not greatly affected by the risks of price wars or other wars. In addition, price wars generally focus on the low-end market. Therefore, giving up low-end customers and shifting the focus to high-end customers is also a way to break through the current LED price war.

2016 is the first year of the 13th Five-Year Plan. The 13th Five-Year Plan is bound to be a powerful promoter of the LED display industry. Looking into the future, if you are poor, you will want to change. Only change and innovation are the keys to enterprise development.