At the same time, the domestic GDP has been growing steadily for many years, the market demand continues to expand, and the level of consumption continues to increase, allowing export companies to see the richness of domestic cakes. Under the influence of uninterrupted “anti-dumpingâ€, restrictions on exports and appreciation of the RMB, especially under the pressure of the slowdown of the US economy, the decline in personal consumption in Europe and the United States, and the contraction of market capacity, Chinese furniture companies have encountered more and more foreign sales The more obstacles. Therefore, more and more export enterprises have set their sights on the long-term development and turned their attention from foreign countries to domestic ones.
Who moved the cheese of furniture export enterprises
Haier Group Zhang Ruimin once said: "Do not do domestic instability, do not do abroad is not strong."
At present, most furniture companies facing export to domestic sales have apparently large production capacity, strong production capacity, high supply chain integration management efficiency, long-term stable customer sources, high standardization of operation, and advanced production management. However, in fact, these The so-called core advantage of the enterprise is the low price, and it has won a place in the international market with high-quality and high-priced products.
The high quality and high price result from the low domestic labor force and the excessive consumption of resources. With the adjustment of rural policies by the state, restrictions on resource-based enterprises and the improvement of the overall living standard of the country, this "core advantage" of furniture export enterprises no longer exists. In particular, with the acceleration of the international integration competition pattern, the export environment has deteriorated and profits have become thinner, making the export of sweet and sour meat more and more into a "chicken rib". Most export enterprises are facing great difficulties and pressure. It comes down to the following factors:
RMB appreciation
In July 2005, China implemented exchange rate reform. The RMB exchange rate is no longer pegged to a single US dollar, but is based on market supply and demand, adjusted with reference to a basket of currencies, and implemented a floating exchange rate system. Since the exchange rate reform, the appreciation of the renminbi has not only affected the price of Chinese furniture in the international market, but also made all export enterprises feel the blow, which has brought great pressure to foreign furniture companies.
Export tax rebate rate decreased
In recent years, the state has optimized the industrial structure, promoted the transformation of foreign trade growth mode, and promoted the balanced development of import and export trade. The macro-control policies have been continuously strengthened, and the export tax rebate rate has been structurally adjusted several times. Since many enterprises regard export tax rebates as their main profit component, this undoubtedly increases the export cost of enterprises. On July 1, 2007, the Ministry of Finance once again issued a new export tax rebate policy, lowering the export tax rebate rate for furniture products by two points to 9%, forcing furniture export companies to look for new profit points.
Rising raw material prices
In recent years, the prices of the main raw materials of furniture products have risen sharply. The prices of wood and oil have risen since 2004, which has caused the raw materials of furniture production to rise sharply, which has caused the cost of exported products to rise. The sales price of exported furniture cannot be increased proportionally , So that the cost of enterprises is getting higher and the profits are getting thinner, and the export cost advantages of some other countries in the world have increased. For example, Vietnam and other countries in South Asia and Southeast Asia have increased cost competitiveness in the international market competition. The advantages are obvious. The furniture export of enterprises has a certain impact, which has increased the survival pressure of furniture export enterprises.
Resistance to trade barriers and anti-dumping
In recent years, many countries such as the United States have conducted anti-dumping of Chinese panel furniture. Furniture manufacturers in EU countries such as Germany and Italy have also submitted anti-dumping complaints against Chinese upholstered sofas and seats to the European Commission. Due to the trade deficit, many The country resisted imports directly or by raising high-quality standards, which pushed China's furniture to the top of international trade again and again.
National restrictions on resource-based enterprises
The Ministry of Commerce, the General Administration of Customs, the State Environmental Protection Administration and other seven ministries and commissions jointly issued the "Catalogue of Prohibited Commodities for Processing Trade", which lists plates and furniture made from domestic wood as raw materials, which are prohibited from export. With the rapid growth of China's furniture exports, proper control of export growth and industrial upgrading is a long-term plan to maintain the sustained and healthy development of furniture exports. Although restricting and adjusting certain products is beneficial to the long-term development of the industry ’s exports, the implementation of these policies that inhibit the export of wood products, coupled with the gradual ban on government loans, tax rebates, customs duties, and land preferential policies in the furniture industry, allow furniture exports Enterprises feel the pressure of survival.
The United States shows signs of economic recession
"U.S. consumers sneeze, and China will quickly catch a cold." This phrase sounds like a joke, but it is indeed a true portrayal of the Chinese economy.
With the bursting of the housing bubble in the US, the US is now showing signs of economic recession, and the purchasing power of US consumers is beginning to be unsustainable. According to Morgan Stanley's professional research report, for every 1% of the US GDP growth rate, China's GDP growth will decline by 6.5%. As the furniture industry that is most dependent on US exports, the downward trend will be more serious. The signs of recession in the United States have made furniture companies exporting to the United States face the severe situation of a sharp decline in business.
The above-mentioned negative factors for export are like a fork and spoon, which eats the cheese of the exporting enterprise. So in the face of many factors that are not conducive to export, many furniture export companies look back at the domestic market.
Turning point from export to domestic sales
"It is difficult to export, and domestic sales are troublesome." Many furniture export companies do not know how to do domestic sales because they do not have any domestic sales experience. In fact, the transformation of the target market is like a strategic shift in the war of military strategists. It is necessary to be familiar with the situation on the battlefield before taking a combat strategy. Due to the influence of different political and economic systems, scientific development levels, national culture, natural resources and other factors, the domestic market has many differences compared with the international market. To switch to the domestic market, you must be familiar with the domestic market, so as to formulate a reasonable and effective marketing strategy . This is a challenge as well as an opportunity. The key depends on whether export enterprises can successfully realize the role change and strategic adjustment, and control and grasp the domestic market space.
1. The difference between the domestic market and the international market
Competitive factors are different
The products of most furniture export enterprises lack brand awareness and cannot show brand advantages. Even some enterprises do not have their own independent brands, but as OEMs of foreign brands, their brand awareness and ability to build brands are limited. Although there are also many export enterprises that have built up their own strength, they have begun to build their own brands, but the brand reputation is not high, the influence is limited, and most of them hover on the edge of relying on the coolie to survive.
In the domestic market, due to the fact that the basic competitive conditions of the manufacturers are almost the same, the cost advantage is not as obvious as the international market, and with the economic development, the furniture market has gradually stepped out of the stage of winning by low cost. Crucially, some export brands are not yet recognized by domestic consumers.
Different customer needs
Due to differences in geographic areas, consumer culture, and consumer capabilities in the international market and the domestic market, customer demand performance is significantly different.
The main performance is:
First, customers' buying habits and value factors are different. When exporting furniture to customers, they are either middlemen such as agents or traders, or OEM for foreign companies. They pay more attention to factors such as cost and quality stability. Except for distributors, most of the customers in the domestic market are those who are in direct demand. They pay more attention to factors such as brand, product value, product style and cost performance when buying.
Second, different levels of consumer demand. Consumer demand is closely linked to the level of economic development. In developed countries, the level of demand is relatively high. Although reform and opening up has been around for nearly 30 years, the economic development between our regions is very uneven, so the demand level is also different. The demand level in first-tier cities and developed areas in the east is relatively high, but The level of demand in the western region is relatively low.
Marketing channels require varying degrees
Due to the relatively low degree of openness in China ’s import and export trade, few export companies have widely established sales channels abroad. The customers of export companies are highly concentrated and relatively stable. It is not uncommon for companies to rely on a few stable large customers Often companies produce according to the sample standards provided by customers, and there are no cases of new product promotion. They do not need to spend too much time on channel operation.
In the domestic market, we must have rich experience in marketing channel operation, establish a reasonable channel network, and achieve refined channel operations, such as the selection and evaluation of dealers and agents, and the location and promotion of terminal stores. , Refinement operations are very demanding.
Different marketing function strength requirements
Furniture export enterprises mainly rely on cost advantages, competition is at a low level, customer channels are linear channels, not network channels, marketing functions are very weak, some are limited to business contacts and relationship maintenance with fixed customers, and product planning functions , Promotion functions, pricing functions, channel planning functions, brand planning functions and other aspects are relatively weak, and most OEMs and processing companies are even in a blank state. However, in the domestic market, the current market competition has developed fiercely, and the marketing function has been more mature.
Second, change to win
After the export enterprises turn to the domestic market, due to the great changes in the environment and the different customer groups, the marketing strategies adopted must be adjusted. Export enterprises should put forward effective positioning based on the market environment, their own conditions and the characteristics of consumers. After all, China's market environment is different from that of foreign countries. Foreigners like the same product, but Chinese people may not like it. In order to make a difference in the domestic market, it is necessary to put forward reasonable strategic planning and positioning based on consumers, the competitive environment and its own situation, find out the market entry point, and formulate a set of positioning that is suitable for the domestic market environment. Choose your own development direction and do a good job in brand building, channel planning, product structure adjustment and organization management.
Implement brand winning strategy
The current domestic furniture market competition has become more and more mature, and the era of winning by a single point of advantage has passed. Instead, it has relied on the systematic winning period with the brand as the core, entering the brand winning stage, and the competitiveness factor is focused on the brand. Without a brand, there is no core of competition and no foundation for sustainable development. It is difficult for ordinary consumers to judge the quality of products rationally, and they believe in the power of brands. Therefore, export enterprises must understand their own advantages, shape their own brands, implement brand winning strategies, and do a good job in brand positioning and brand promotion.
At present, the well-functioning furniture in the domestic market basically belongs to the companies that have made achievements in brand construction, such as the rich, Yaobang, Dynasty, CITIC, etc. are all outstanding in this regard. The export furniture enterprises that transfer domestic sales must plan their future brand direction based on their strategic positioning and brand positioning, and plan specific brand promotion measures and methods based on domestic consumer and media conditions. In the Chinese market environment, advertising has a strong driving force in marketing, and the success of the brand is also the only way for brand promotion. Therefore, export enterprises should establish strategic alliances with professional magazines and professional exhibitions, and increase cooperation in many aspects, covering all communication activities such as advertising, promotion, public relations, direct marketing, CI, packaging, news media, etc. to the scope of marketing activities. Within it, enterprises can exert a strong brand effect when they first enter the market, break through the control of existing brands in the market, and occupy their due share in the minds of consumers.
Do well in channel planning and management
The perfection and refinement of the channel network plays a very important role in the circulation and sales of furniture products. The first link in the operation of the domestic market is investment promotion. Without a distributor, your products cannot be in contact with consumers, and naturally cannot be sold. Most export enterprises are basically blank in the domestic market, unfamiliar with the domestic market, lack of channel operation experience and ability, fail to establish a good channel model and formulate reasonable channel policies, do not know what dealers are most concerned about, no I know from what aspects to improve myself, and I do n’t know what policies can attract dealers to join, what policies can allow dealers to invest enough energy to operate, and other policies can not really be in place.
Therefore, when setting up a marketing network, the layout of the marketing network should be properly carried out based on the company's own strength, development strategy, and regional differences and distribution characteristics of market demand, and a perfect channel management policy should be established. Under the premise of not damaging their own interests, to meet the interests of dealers, from the aspects of channel development policies, channel incentive policies, channel control policies, channel optimization policies, etc., let distributors feel that your products are profitable; Manpower, material and financial resources, improve the execution of channel management, control the standardization and efficiency of channel operation, so that the company's products can be delivered to customers in a cost-effective and smooth manner, and thus consolidate and develop the strategic foundation of the company.
Adjust product structure to meet market demand
The demand in the domestic market is very different from the international market. Export companies do not know much about the competition in the domestic market and consumer demand. Therefore, they must adjust the product structure, and conduct in-depth and extensive market research before adjusting the product structure. In order to adapt the adjusted product structure to the needs of the domestic market. Enterprises must adjust their product structure according to market positioning. The product structure must be consistent with the company's strategic direction not only in category, but also in price and quantity. So that the product structure and brand positioning coincide with the company's development strategy.
Improve marketing organization system
For enterprises that want to develop the domestic market, without effective organizational guarantees, any beautiful plan can only become a dead letter. Product development, production, brand planning, market operation, communication, and product sales all require different departments to implement and manage. Many export enterprises do not have a sound departmental setting when exporting. After entering the domestic market, they must build a sound marketing organization system in order to Systematic measures such as enterprise brand building, channel construction, and product adjustment can be smoothly implemented. Export enterprises should build an enterprise organizational structure with the marketing function as the core and other functions to supplement the marketing function, highlight the main role of the marketing department in the operation of the enterprise, and all positions should be close to the front line of the market and consumers to quickly improve marketing efficiency. At the same time, we must also strengthen organizational execution, refine the organizational division of labor, focus on marketing channel sales management, and strengthen marketing training to train marketing personnel at all levels and positions.
Be a good model market
In a fiercely competitive market environment, many dealers are operating cautiously, and the terminal is a place where furniture products, brands and consumers have direct contact. In the terminal environment in which hypermarkets and specialty stores play the leading role in the future, the terminal's single store sales force will play a particularly important role. Therefore, export companies must first "go to the beach" brand hypermarkets. In the domestic market, whether they are self-supported or support major customers, they must first make a few sample markets, focusing on building a terminal image. A good beginning is half of success. With a good model store or model market, the probability of successful promotion will double. Then through the creation and improvement of the terminal's single store business capacity, the company's terminal's overall business capacity can be improved to drive the overall increase in corporate sales.
Maintain product quality
The brand is not supported by advertising, but is based on perfect product quality, with systematic and scientific brand management and unwavering brand strategy as the means, and is formed by the team in the long-term division of labor cooperation, overall operation, and collaborative development. The foundation of the brand is the product, product quality is the life of the brand, quality is the foundation of the company's survival, and poor quality furniture products are difficult to win consumers' favor in the domestic market. Adhering to the quality of products and ensuring that there are no problems in after-sales quality determine the success or failure of domestic sales for export enterprises. At the same time, domestic and foreign consumption habits and aesthetic concepts should also be considered, existing export products should be improved, investment in development should be increased, and the swivel chair should focus on product research and development to increase the gold content of the brand.
At present, the Chinese furniture industry is still in a low-level competition stage, and there is no real furniture sales giant. The immature market also means that there is still much room for development. The key depends on how companies do. We often mention industries that do not work, only enterprises that do not work. It is believed that many export enterprises can look back at the domestic market and successfully realize the role change and strategic adjustment.
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