The problems that have always existed in the home building materials industry will be concentrated in the cold snap. Beijing piloted the policy of replacing old furniture with new ones. The income from participating in the pilot program has increased by at least 30%. However, the policy cannot fundamentally restore the decline of the home furnishing industry.
The Bafanglong Lighting City, built in 1999, is located on the West Fourth Ring Road in Beijing. For more than 12 years, the lamps have been operating here. Starting from March 31 this year, the Bafanglong market no longer sells lighting, and instead operates flowers, birds, fish and insects. Bafanglong, which was once known as the “Big Eight Lighting City in Beijing†with Yuquanying, Shilihe, North Fourth Ring Road, Wanjia Lighting, Bandung Huiyang, etc., became the first closer of the Beijing Home Furnishing Store in 2012.
In fact, since 2009, due to the impact of the international financial crisis and real estate regulation policies, the operating conditions of the Lighting City have changed. The decrease in passenger flow and the withdrawal of merchants, it was not until March this year that this 7000 square meter lighting city was determined to transform.
Failure and transformation seem to spread like an infectious disease. Beijing has successively established Xinglong Home Furnishing Building Materials City, Jinkailide Home Furnishing Store, Dongfang Jiayuan Lishuiqiao Store and other home building materials cities, either closed or withdrawn.
In November this year, Beijing piloted the policy of replacing old furniture with new ones. Liu Chen, secretary general of the Beijing Market Association Home Furnishing Market Branch, told this reporter that the income from participating in the pilot program has increased by at least 30%.
Can a shot of cardiotonic medicine fundamentally restore the decline of the furniture store?
Absolute excess
The policy of replacing old furniture with new furniture was first proposed by the Ministry of Commerce. In February this year, when reporting on the operation of China ’s commercial work in January 2012, the Ministry of Commerce spokesman Shen Danyang said at the press conference that the Ministry of Commerce is conducting research with relevant departments to introduce new The policy measures to promote consumption include measures such as trade-in replacement.
On June 1, 2012, when Vice Minister of Commerce Jiang Zengwei inspected the old furniture recycling center, he asked Real House to write a report on the old furniture recycling experience and submit it to the Ministry of Commerce for reference by the government when formulating a policy of furniture trade-in. Beijing subsequently became the country's first pilot city to replace furniture with new ones. On November 1st, five companies, including Actual Home, Red Star Macalline, Jimei Home Furnishing, Chengcheng Home Furnishing Plaza, and Lanjing Lijia Dazhong Temple Home Furnishing Plaza, began a one-month pilot.
According to the latest news provided by the Beijing Municipal Commission of Commerce, from November 1 to November 25, five pilot sales companies sold 18,584 pieces of trade-in furniture for an amount of 106 million yuan, accounting for 24.2% of the total sales of similar furniture.
However, Meng Guoqiang, chairman of China Construction (3.07, -0.01, -0.32%) Material Circulation Association, believes that policies cannot fundamentally restore the decline of the home furnishing industry. The problems that have always existed in the home building materials industry will be concentrated in the cold snap. This is manifested by the disorderly expansion of hypermarkets. Dealers can no longer keep up with the speed of hypermarkets. Large enterprises are competing with each other, and some small and weak power stores may be eliminated.
Both Meng Guoqiang and Liu Chen believe that the absolute area of ​​furniture stores nationwide is excessive.
In the past 10 years, the furniture industry has maintained an annual growth rate of 20% to 30%. Even after the financial crisis, it still once claimed to be the "sunrise industry". Therefore, the home store has never stopped "inflation". Around 2008, not only Beijing, but many stores opened all over the country. They recruited both producers and distributors. Some companies realized the risks and gradually withdrew. At present, most manufacturers do not operate in shopping malls, but hand over products to distributors.
On the afternoon of September 13, American building materials giant Home Depot suddenly closed all seven building materials stores in China. Home Depot is the second largest retailer in the United States after Wal-Mart and the world's largest home building materials supermarket. Home Depot (China) issued a statement on September 15 stating that the company's business focus will be transformed into professional retail stores and online sales.
The giant B & Q has been losing money in China for 6 consecutive years. The tide of closing stores that swept B & Q three years ago has not stopped. After closing a store in Nanjing early this year, the number of B & Q stores in China has shrunk from 63 at the peak to 40.
Meng Guoqiang believes that it is impossible for domestic large-scale brand stores to see these problems, but on the one hand, they exceed expectations and think they can squeeze out others. On the other hand, there are plans to store land, and they can get the land cheaply in the investment attraction of local governments.
In December 2009, Red Star Macalline had only 60 stores in 38 cities across the country. In less than 3 years, it added more than 40 shopping malls. According to its plan, by 2020 Red Star Macalline will open 200 stores nationwide. The home is actually racing against time. Following the opening of 12 new stores last year, the group plans to open 17 new stores this year, involving third- and fourth-tier cities such as Daqing in Heilongjiang, Quanzhou in Fujian, and Lu'an in Anhui. But since last year, both companies have reported that the stores have closed down.
Unstoppable elimination and adjustment
Wangli Baili Home Supplies Mall, Yanzhao Furniture City, Liangdu Home Mall, Hongyanqiao Building Material City and Dachao Furniture City, Love and Celebrity Decoration Center, Lianrijiayuan Furniture Building Materials Street, Bixi Square, Lize Building Material City, Tianwei Building Material City, and Lanjing Lijia Building Material City have gradually faded out of sight.
During the downturn, the shock seems to be more intense. The purchase volume of newly-built commercial housing is declining, and the decoration materials of social housing are generally purchased in bulk, and rarely pass through the sales channel. "This presents a new issue for the store," Meng Guoqiang said. "In the future, developers will build more decoration rooms. Can the home store change the retail mode, become a distribution center and logistics center, or become a large wholesale center?"
At the same time, the aggressive momentum of e-commerce has also provided new issues for the traditional furniture and building materials sales carrier, the home building materials market. "Either become an e-commerce exhibition base, or open up e-commerce channels." Meng Guoqiang said. At the Taobao National Carnival, the daily turnover of the home building materials branch exceeded 1.2 billion.
The Red Star Macalline franchise has begun to extend its business to the Internet. Its e-commerce plan mainly includes three parts: B2C platform business mainly based on home building materials products, snap-up business when using the upper limit of home textiles and small household items, and group purchase business of household items, which touches various transactions in the e-commerce market the way.
However, Meng Guoqiang believes that the threat of e-commerce is not great. Most e-commerce transactions are low-priced products, and high-end furniture has not been involved. However, according to the current trend, e-commerce may snatch a large share in the future.
The business model of domestic furniture stores is mainly to collect rent and management fees, such as the actual home, the rent is partly fixed according to the location of the shop, and the management fee is charged according to the store's sales. May and October are two points. Compared with the dealers stationed in the malls, the malls are often in a strong position, and their income can be “protected from droughts and floodsâ€. Liu Chen pointed out that furniture stores must lean towards consumers, ensure the rigidity of services, and use large carriers for marketing and promotion. He also pointed out that the development of the complex may also be one of the trends.
The merchants of Lanjinglijia Home Plaza in Dazhong Temple told our reporter that business started to improve in October this year.
Correspondingly, the National Building Materials Home Furnishing Index jointly released by the Department of Circulation of the Ministry of Commerce and the China Building Materials Circulation Association suddenly rose to 130.29 in October, soaring 9.47% month-on-month and 7.52% yoy. This is the second highest peak since the prosperity index was released in March 2010, and is only inferior to 134.9 in May 2010.
In October, the sales of building materials and furniture stores' home stores also rose sharply. According to data released by the China Building Materials Circulation Association, sales of building materials and home furnishing stores above the national scale in October were 142 billion yuan, a substantial increase of 20.28% from the previous month. However, the cumulative sales from January to October were 1039.1 billion yuan, a year-on-year decrease of 4.6%.
Liu Chen believes that on the one hand, the real estate market has begun to pick up; on the other hand, the trade-in policy has also awakened some wait-and-see and lagging consumption.
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