Hardware companies in the era of meager profit competition

The reshuffle of the hardware industry will prompt the advent of the low-profit era, and the shuffling of the low-profit era will be even fiercer. After shuffling, due to more marketization and more intense competition, shuffling will continue. After many rounds of shuffling, the hardware industry is bound to be like the home appliance industry, and its profits are even lower. According to Luo Baihui, head of the International Die & Metals and Plastics Industry Suppliers Association, in the era of meager profits, hardware companies face the increasingly fierce competition in the hardware market, and they have to adopt a vertical and horizontal strategy based on the brand, strive to cultivate the supply chain, and cooperate with suppliers. Together to create a solid industrial chain, in order to reduce their respective capital account, improve product qualification rate, speed up the speed of capital turnover, in order to ensure that they have the appropriate profit margins.

Based on brand building, most small and medium-sized enterprises are difficult to establish. Most of them rely on imitation and OEM production. Most of these companies will be eliminated. They will be eliminated, and the majority of the rest will have strength. Enterprises with better brand building, in fact, the development of self-owned brands is a strategic direction for enterprises, that is, in the long run, we must base ourselves on our own brand and realize from OEM (origin processing) to ODM (origin origin). From the design and production to the upgrade of brand marketing, it gradually enters the high-profit segments of marketing channels and brand operations.

Vertically build a stable industrial chain According to statistics, among the top eleven most effective use cost reduction methods, there are procurement negotiations, early suppliers, leveraged procurement, joint procurement, design for convenient procurement (DFP), centralized procurement, etc. The project is related to the supply chain. Luo Baihui, head of the International Mould and Hardware & Plastics Industry Suppliers Association, believes that hardware companies need to work hard to cultivate the supply chain and work together with suppliers to create a stable industrial chain to reduce their own financial resources. Improve product qualification rates and accelerate capital turnover to ensure that each has its own profit margins.

To open up a diversified market horizontally, we must increase the implementation of the “go global” strategy, guide and encourage powerful hardware companies, and establish “China Hardware Industrial Park” or “production and processing” in Central and South America, the Middle East, Eastern Europe, Africa, and South Asia. "Base" to carry out cross-border resource allocation and open up diversified markets.

Promotion and construction of industrial cluster service platform Industrial innovation platform Serving small and medium-sized enterprises in industrial clusters with weak technical and product development capabilities and low management levels, providing enterprises with comprehensive innovation services, upgrading their innovative capabilities and technology, operation and management levels, and accelerating industrial clusters The structural upgrade of export products.

In the era of meager profits, companies must compete in different market environments. For example, they have to rely on brands to take vertical and horizontal strategies and come up with a road.