Solar water heater industry towards maturity
According to the industrial development of the division cycle of four stages, the current solar water heater industry is maturing.
Key point: According to the industrial development of the division cycle of four stages, the current solar water heater industry is maturing. During this period, the market slowdown, margins, price wars often become the norm, under the command of the law of the survival of the fittest, competition gradually clear, large-scale enterprises began to emerge and lead the industry. Solar water heater for the labor-intensive enterprises, seek advantages of scale, the implementation of overall cost leadership strategy, the current industry environment as the most practical and effective strategic choice.
The advent of maturity
15 years ago no different from the traditional household appliances, solar water heater industry is a labor-intensive industries. Barriers to entry are low, not high tech, many small and medium enterprises, investment diversification, rapid market growth, higher margin products. In particular, after 2003, the solar water heater industry maintained a growth rate of 30% per year in 2009, driven by the policy of home appliances, even more than 40%. However, in 2010, the growth rate suddenly dropped to about 15%.
It now appears that the growth rate plunged in 2010, the macroeconomic environment, natural disasters, to the countryside policies result of external factors such as overdraft, but essentially, it is the laws of the market-led development of the industry cycle, the law dictates. Because in a fully competitive market, it is impossible to have a sustained high growth industry, and will not tolerate a circle in the low-tech, low levels of competition in the industry to have enough cake for up to 6,000 companies eating . Thus, in 2010 the first year of the momentum and to shuffle. After the growth rate decreased drastically, with the economic policy environment is more severe in 2011, solar water heater industry growth will continue to decline, or even do not rule out the possibility of negative growth.
According to the industrial cycle theory of representation, the industry market is maturing following characteristics: market growth rate is not high, the product is technically more mature and no big difference between a buyer s market is extremely sharp, industry profitability declined, new products and product new uses are still in development, industry barriers to entry high.
Contrast weigh the current solar water heater industry, the characteristics can be said to match exactly.
Changes in cooked
But it should be noted that, from the industry perspective, the solar water heater industry by the growth in the maturing stage, due to financial crisis, product transportation and logistics industry, a unique radius limit long management of the situation, may be resulting in the phenomenon of half-cooked.
Specifically, when the solar water heater by a period of rapid growth to maturity forward, due to lower margins and lower market growth will cause the phenomenon of large-scale reshuffle, eliminating the inferior, "left" excellent, after re-entering the industry matures period. But for the solar water heater industry, the financial crisis suddenly struck, the accumulation and brewing industry is not sufficient, it suddenly hit shuffle, while the radius of the logistics constraints and lack of supervision, lack of industry standards, some areas of the local protectionism and making a considerable part of the regional brand-name or to be retained. Shuffling half-cooked, will inevitably drag the hind legs mature market competition – the future of the dominant, mainstream business he is busy with the conventional means of building competitive advantage, one side had to be distracted, to deal with fake brand names, fake brand-name or distracting to clear the local protectionism.
Size, or scale
Changes in half-cooked, and can not influence the direction of the next competition – large-scale competition. As mentioned before, solar water heater for a labor-intensive industry, the implementation of overall cost leadership strategy to confront the scale of the risk and increase the threshold into the industry only to build quality affordable competitive advantage, market competition has become the preferred destination for the future choice.
Mature household appliances such as air conditioning industry, has given us presents such a development path. According to the record that, when the situation is: had to rely on leverage to build the price of 200 million units in the club, Gree, Midea, Haier s success among the. Eight years later, these three brands are still firmly occupy the position of front-line camp, difference is that the threshold for first-line camp has been raised to 400 million units.
Hold this view, there is sun, rain, general manager of Rong-Hua Chen. Early in the second half of 2010, Chen R interview with reporters, said, "solar thermal industry will enter the era of large-scale competition , shall be half the size of multiple hedge risk." Rong-Hua Chen explained, "If the capacity to divided the industry into the threshold of the next three years, annual sales 500 000 -100 million units eligible to survival, 100 million to 2 million units are second-tier companies, and 200 million units, in order to hold onto the status of front-line business. "
This law is not applied mechanically. Need to argue that, for such a labor-intensive industry, too much emphasis on brand marketing, emphasis on high value-added, emphasizing the difference one way or another, are biased. Support from the scale, large changes in the macroeconomic, microeconomic risks to prices of raw materials, labor costs and low profit improved drag, will have added the so-called brand, the so-called value-added offset depleted. Because it is evident that, as the necessities of life such as solar water heater industry is unlikely to watch the birth of the industry as a price of up to tens of thousands, hundreds of thousands of Omega.
It can be said, overall cost leadership strategy, large-scale competition, will be the next phase of the solar water heater industry, the tone of competition in the industry and supported by specific differentiation strategy or strategy carried out. This is world-renowned scholar Michael Porter on strategic management of the thesis as part of competitive strategy.
Indeed, if the solar thermal sights on a large industrial point of view, the high-temperature solar energy market, in contrast, thermal power generation commercially is the essay, then the whole industry will usher in a new round of growth. However, this should be higher than the solar water heater industry, another proposition.