Fertilizer Industry Basic Marketing Strategy

With the end of the market shortage economy, competition in the fertilizer industry is becoming increasingly severe. At present, the competitive model adopted by various enterprises is still the traditional low-price competition model. As we all know, such a competitive approach not only requires long-term, stable, low-cost channels to support, but also does not harm the development and profitability of enterprises. In the long run, the fertilizer industry may also be caught in a vicious circle of depressed business operations. Therefore, in addition to controlling costs and increasing profit margins, proper use of marketing tools to increase the competitiveness of enterprises has become one of the most necessary business strategies in the current fertilizer industry.

As the saying goes: "Know thyself and know each other and fight every battle." To occupy the competitive gimmick in the fertilizer industry, we must first understand the basic characteristics of China's fertilizer industry. Thinking about consulting and marketing consulting experts according to the current China's fertilizer industry's "quotations" summarized as the following:

1. The contradiction between production and demand expands and the competition becomes fiercer. In recent years, in order to improve the passive status quo of past fertilizer shortages, China has vigorously developed and supported the chemical fertilizer industry, resulting in an unprecedented growth in the chemical fertilizer market and rapid production growth in fertilizer production. Up to now, the current status of production and demand for chemical fertilizers in China is that nitrogen fertilizer supply exceeds demand, and phosphate fertilizers are basically balanced, and supply of potash fertilizer is in short supply. It is expected that in the next few years, as China continues to support the fertilizer industry and rebuild some aging fertilizer plants, competition in the fertilizer industry, especially in the nitrogen fertilizer industry, will become increasingly fierce.

2. Farmers' income was frustrated, and prices continued to be sluggish. With the continuous fluctuations in the purchase price of various agricultural products, the economic income of farmers was also seriously affected. Under such circumstances, many farmers abandoned their ancestral farmland for migrant workers, causing the loss of a sturdy labor force. The enthusiasm of fertilizer purchase by left-behind farmers is generally low, making the price of fertilizers sluggish.

3. Shorter peak season time, higher reserve pressure Traditional fertilizer sales can be summed up as “three-sixty-six”, which means three months of sales, three months of flat sales and six months of winter storage. In the actual situation, agricultural capital companies will inevitably increase the pressure on storing fertilizers because of slow sales and other factors. This situation will also cause the consequences of poor production turnover.

4, the sales area is dense, to force the brand is missing In the planned economy period, each chemical fertilizer plant is in a fixed sales area designated by the country, and thus formed the status quo of the fertilizer brand is seriously restricted by the region. At present, China does not have any brand of chemical fertilizers, and it is able to break the "local domain name card" and sell it nationwide.

5. Poor operation of enterprises, lagging payment recovery due to the contradiction between a large number of national policies being fostered and the current market conditions being not good, coupled with extensive adoption of extensive business models by agricultural companies, which has led to a large number of agricultural capital companies operating poorly. Taking chemical fertilizer production enterprises as an example, the biggest business difficulty is that a large amount of money cannot be recovered, resulting in insolvency of the company's capital and on the verge of bankruptcy.

To sum up, we can see that the current operating status of the fertilizer industry is not optimistic, and the biggest constraint is the traditionally extensive business structure and simple price cuts. Therefore, the consulting consultant marketing consulting expert based on the marketing point of view, proposed several feasible strategies for the current Chinese fertilizer companies to enhance competitive advantage, are summarized as follows:

1, based on the contradiction between production and production of product strategy The so-called product strategy, is to vote for farmers, in the chemical fertilizer products, particles, color, packaging and other aspects of the improvement, so as to improve the fertilizer product "first impression" and increase competitiveness. Product strategy is mainly divided into two levels: First, to strengthen the quality inspection, improve the appearance of chemical fertilizer products, so that large particles, less dust, rounded, uniform, bright color, etc.; Second, in the packaging specifications for empathy, Various kinds of packaging are introduced to facilitate the purchase and use of farmers with small farmland in their homes. The purpose of this is to maximally draw together potential customers and clients, while providing customers with visual enjoyment and convenience, while subtly promoting the product.

2. Establishing a price strategy based on the market downturn Since farmers are still most sensitive to price issues and the inherent quality of similar fertilizer products is similar, price reduction not only remains the first among general-purpose promotion strategies in the fertilizer industry, but there is still a clear promotional effect. Therefore, today's fertilizer market basically adopts the principle of “small profits and quick turnover”, and promotes the prevailing trend of low-price sales in order to exploit the situation and occupy market share. In this regard, the author's view is: price reduction strategy in the past for many fertilizer companies brought about the convenience of sales, but also can certainly occupy part of the market, but need to be clear to see that too low prices will damage the foundation of the company - profit Therefore, the occupied market share will be meaningless, and then the company will be trapped in an operating fan with no power and idling. It can thus be seen that in implementing the low-price strategy, we must pay attention to the problem of “degree” carefully, and establish a set of price strategies based on market share and corporate profits, instead of blindly reducing prices.

3, based on the tight season to establish channel strategy State Council No. 39 document provides that fertilizer manufacturers can not only sell products to agricultural capital companies, but also can be sold to agricultural "three stations", but also direct sales. This determines that different companies can comprehensively use various sales channels and tailor channel strategies based on their own operating conditions and market conditions. Here, the author does not describe the sales channel strategy in a unified manner, and only evaluates the advantages of the three sales forms so that business owners can choose their own ratios:

Agri-funded companies are agents that directly occupy rural shares. Through cooperation with them and the issuance of proxy rights, they can reduce the amount of risk that they are willing to assume while holding the market. Choosing the right agricultural agent is equivalent to occupying a large potential market.

The "three stations" of agriculture belong to the state-certified specialized agricultural technology department and have a group of "experts" who often deal with farmers and provide scientific guidance to farmers on agricultural technology. Therefore, the development of cooperation with the "three stations" in agriculture is more likely to gain the trust of farmers than cooperation with agricultural companies.

Direct selling is the sales model with the least intermediate links and the lowest retail price. In addition to allowing farmers to benefit, they can also promote the rapid recovery of payment and avoid the consequences of poor fund recovery. The promotion of direct sales includes the establishment of direct selling points in rural areas and the development of home delivery services.

4. Establishment of Brand Strategy Based on Geographical Limits The previous article has already stated that due to the restriction of the “Regional Domain Name Card”, China’s fertilizer brand has been developing poorly. Due to fierce competition, poor management, and other factors, brands also exhibit vicious competition and plunge each other, thus allowing imported brands to take advantage. In response to this situation, fertilizer companies should focus on two aspects when formulating brand strategies: First, establish their own brand names, gradually break the geographical barriers through the introduction of corporate brand culture concepts, and establish domestically-renowned brand-name chemical fertilizers that are sold nationwide; The second is to resist the invasion of imported fertilizers, and to restore the purchase rate with the advantages of inexpensive materials and domestic goods.

5. Establishing promotion strategies based on cash flow In order to quickly withdraw funds, fertilizer companies should formulate a series of promotional measures to establish a chain of production and sales integration. Specific measures include: vigorously strengthening the advertising campaign, targeting the characteristics of rural entertainment projects, organizing various cultural performances to publicize fertilizer products in rural areas, and improving the product’s popularity and reputation in the form of semi-public and semi-advertising; at the same time, it will also promote products. Advantages are integrated into the call for science and technology to the countryside, and through the provision of agricultural technology for farmers, and scientific guidance for farmers to fertilize, they gain the trust of farmers and increase product propaganda to eventually cultivate loyal consumers.