The building materials industry may soon usher in the era of high channel costs

Love and hate are intertwined. This is a vivid portrayal of channel attitudes of home-based manufacturing companies and distribution companies. With the constant increase of rents and new store operating costs to open up traditional channels, the real distribution channels of home companies are facing high cost challenges. "The channel is king", and the channel is strong. However, in the era of high-cost channels, the expansion of active or passive traditional sales channels may bring new risks and challenges.

In recent years, the cost of opening stores has risen in many building materials supermarkets, including most building materials such as paints, ceramics, sanitary ware, flooring, doors and windows, and the current price has not changed much from that before the holiday. The TOTO, Jiumu, Wrigley, emperors, Oulusha and other sanitary brands, Marco Polo, Nobel, the new Zhongyuan, Shengdebao, Asia and other ceramic brands, have different degrees of discount. Promotion staff introduced, because it is currently in the decoration season, most ceramics, sanitary ware manufacturers have concentrated on the introduction of new products, prices have not changed significantly.

Faced with this challenge are EGGER flooring and flying beauty furniture. According to Ai Geng floor chairman Zhong Hongwen, at present, a floor store with a floor space of about 150 square meters is required to invest at least 500,000 to 600,000 yuan in a home store. If one adds advertising and promotion costs when opening a store, one million will be required. . “In the furniture city, a new store of about 300 square meters will be opened, and the previous hard cost investment (including the entrance fee, store decoration, and sample purchase) will require 700,000!” said Zhou Kaijun, general manager of Feimei Furniture. Indisputable fact.

Three factors driving up channel input In the eyes of people in the industry, there are three main reasons for pushing up channel costs, including the devaluation of store rentals. It is understood that the rent for the home store has been rising very fast in recent years. This is an indisputable fact. An owner of an unnamed furniture company said in an interview with Sina Home: “The home store is a form of commercial real estate, and the cost of the new store itself is rising. The operating costs of the home store are also increasing year by year. The strong position of the stores, in recent years, the rent has increased by more than 10% each year."

The continuous increase in operating costs is another reason for the high cost of the channel. According to Zhang Liliang, vice president of Huanai Lijia, China has already entered the era of high wages. Almost all home-based companies have significantly increased their labor operating salaries, which has also led to increased channel operating costs. “Now the market competition is fierce. For the terminal, excellent clerk is the core resource of scarcity. In order to retain people, high wages and high levies are also things that companies have to do.” Furniture professional consulting and marketing agency - Guofu Wang chairman Zhao Long believes that in the era of high wages, the manpower cost of corporate channel operations will only continue to rise.

“The disorderly expansion of hypermarkets is also a factor that cannot be neglected.” Yang Tao, chairman of the professional children's furniture store, believes that at present, the volume of home shopping malls in many cities is already approaching saturation, and even the phenomenon of excess exists, which is not only for companies to open stores. As the cost increases, if the stores are not well managed and closed, the company must also bear high losses. According to Zhao Long, Chairman of Guofu Aspect, the transition of home stores has been unreasonable, the layout of some cities has been unreasonable, and there has been a false boom in the home market of commercial real estate, while the home businesses that are being expanded have to pay for themselves. The water goes up.

The emerging channel model will rise the traditional physical channel has become a double-edged sword for home companies. “The home industry is highly free-competitive, and it is a fully marketable industry. Therefore, in the face of accumulated competition, many companies have channeled themselves as the king and invested in the construction and management of the channels at no cost.” Insiders believe that the competition in the channels should be improved. Advantages cannot be at the cost of high costs. Otherwise, they will be "a channel for success and a channel for failure".

“The home industry is a typical channel circulation brand stronger than the brand-making industry. For the average consumer, they often only remember where they bought the furniture and building materials. Therefore, depending on the traditional channel model of home stores, it will naturally With the continuous increase in store rentals, the cost of channel operations has been pushed up.” Yang Tao, Chairman of Cool Manju believes that in the existing traditional channel model, it is difficult for household manufacturing and distribution companies to have the right to speak. In addition, the furniture industry has too many layers of traditional channels, regional distributors, provincial distributors, local agents, and county-level agents. After the products have been increased by layers, the final price has deviated greatly from the real prices. It will also be passed on to consumers to pay.

History has proven that nothing can be hanged in a tree. According to Zhao Long, Chairman of China Fortune International, the current home companies have begun to realize that the traditional traditional channel model is flawed. Many companies have begun to diversify their channels, including independent stores besides home stores. The channel is also an emerging channel that is currently the most watched. According to investigations, home furnishing companies with considerable scale and brand awareness in China, including Qumei, Shengxiang, Nature, Cool Manju, Ruibao Wallpaper, Huanai Lijia, Ximengbao, TATA Wooden Doors, etc., have started to test water electronics. Business, emerging online sales have opened up a huge imagination for the home industry in traditional industries.