Appliances business transformation is mixed

In recent years, changes in the international economic market environment have made the government deeply aware of the imperative of industrial transformation and upgrading. As one of the more mature development industries in China, the Chinese home appliance industry has responded positively to the call for national transformation and upgrading and achieved good results.

Appliance companies' transformation and upgrading are mixed

As one of the industries that have been developing for a long time, the Chinese home appliance industry has faced the adjustment of domestic and foreign market environment and national macroeconomic policies, and quickly adjusted its business strategy and management model to obtain a good development opportunity of “curve passing”. The major technological breakthroughs in smart home appliances have also contributed to the transformation and upgrading of the entire home appliance industry.

The latest data released by the Ministry of Industry and Information Technology was affected by the transformation of home appliance companies. In the first two months of this year, the economic returns of the home appliance industry were better than the same period of last year. The main business revenue increased by 6.9% year-on-year, and the total profit increased by 21% year-on-year.

However, in the process of transformation and upgrading, home appliance companies not only enjoyed a performance bonus, but also encountered many obstacles.

Recently, the largest industrial cluster in the home appliance manufacturing industry in the Pearl River Delta has changed its prosperity in the past. The problems are endless. Galanz, Gree and many other large-scale home appliance manufacturers have suffered successive transformations.

Channel renewal and price war spread

O2O is one of the hottest topics nowadays. The tremendous impact of "Internet thinking" has made traditional industries aware of the lethality of e-commerce. Traditional industries facing transformational pressures are all seizing the opportunity of O2O, accelerating the pace of online and offline integration, and home appliance companies and home appliance sales channels are no exception.

Suning, Gome, and other traditional home appliance channel providers continue to improve the establishment of online sales channels and prepare to launch a melee competition with Jingdong. Today, Suning Tesco, Gome Online, and Jingdong have gradually become the “Three Kingdoms”.

The integration of online and offline has become an important direction for channel development. It was originally thought that this year's battle between the “Three Kingdoms” of Jingdong, Gome, and Suning’s channel operators will closely center on the service. Jingdong announced that it will upgrade its after-sales service standard to 30 days without any reason to return; Gome launched air-conditioning after-sales service for free cleaning and maintenance; Suning also launched a thoughtful service to purchase instalments for home appliances.

However, who knows these giants have never been able to get out of the cycle of price wars. May Day holiday is approaching, Jingdong, Gome and Suning all make big fuss about the price. The “price benchmark” is the highlight of the business promotion.

The curtain for the competition of home appliance channel providers has been opened, and people can't help but feel that the original direct role of O2O is to allow the low price promotions to spread online.

Transformation and upgrading cannot only be a matter of business

For the entire home appliance industry, the current adjustment is only the first step in the transformation and upgrading journey. Whether it is a household appliance company or a channel dealer, the eye is only staring at the recent operations and making a fuss. It is highly probable that “a blind sight does not see Mount Tai”.

Transformation is the adjustment and upgrade of the entire system of an enterprise. Technological innovation, marketing changes, management improvements, and service enhancement are all essential steps in this process. It is necessary to grasp the key points and do both.

Ignoring the loopholes in manpower management and blindly pursuing revenue, it is very likely to have a serious impact on the company.

In fact, a proper slowdown in growth and efforts to improve the management system will help companies stay afloat. Retreat is a wisdom for long-term development.