The "profiteering" and "micro-profit" of the flooring industry

With regard to the topic of “the era of low profit”, the flooring industry has been talked about since the outbreak of the financial crisis in 2008. Recently, this topic has been mentioned again, causing no concern. As the traditional decoration is off-season, the flooring industry in the off-season seems to be much deserted than usual. We have to face this reality, and the market has become more and more fierce in price wars. Some companies complain about the small profit margins. Is the flooring industry really entering the “early profit era”?

With the increase in the number of floor brands, the competition among the floor companies has also reached a level of enthusiasm. Enterprises require survival and development, and they must find suitable roads for their own development. Some large companies began to look for high value-added products, change their thinking, innovate products, and further dig deeper products while expanding the horizontal industry chain; and small companies, because of their own funds, technology, channels and other issues, want to expand and deepen products. Development is faced with great difficulties, so they are more inclined to take the short cut, that is, the low price.

"Micro-profit" is relatively dialectical

Ms. Feng Jie, executive director of the new floor, told reporters whether the flooring industry has entered the “micro-profit era” depends on what is the standard. If compared with the flooring industry ten years ago, the floor now is really considered “micro-profit”. Is the floor industry really profitable? Not always. The flooring industry is now more and more regulated, and it has a reasonable profit margin. If there is no profit, why would so many people want to squeeze into this industry? Enterprises will not do a loss-making business.

If we look at this issue with reverse thinking, it will be clearer. The decline in profits of enterprises means that the cost may increase. The increase in costs means that the price of raw materials has risen. If the companies do not reduce their profits under the premise of guaranteeing prices, the only possibility is to use raw materials that are almost the same, and consumers are ultimately hurt. Therefore, consumers also need to be rational when purchasing flooring. Price reduction may not be a good thing.

The era of profiteering is over. Understanding demand is the key

While floor profits are falling, floor companies also need to reflect deeply. General Manager Liu Xiaoyan of Swiss Lucerne Flooring Co., Ltd. believes that the era of profiteering on the floor has long passed. Enterprises provide consumers with satisfaction. To make consumers feel value for money on the floor, they must first understand what they really need in order to grasp the market. Initiative. For example, Russen's floor sells 200 yuan a square meter, which is much more expensive than the domestically-used laminate flooring. But it still has a market because it has found its own selling point and meets the needs of this group of people. Instead of complaining about yourself, it's better to look for the cause and cure the problem.

According to report, Swiss Russell has been very popular since it entered the Chinese market in the 1980s. Now it accounts for about half of imported laminate flooring. To understand the reasons, it is not difficult to find that it is very popular to focus on environmental protection floors in Switzerland. This is exactly what many domestic flooring companies lack. The era of profiteering on the floor has passed and companies should be less impetuous and more focused.

Profit reduction companies need to positively guide consumers

With the rising prices of raw materials, the rise of industry standards, the increase in the cost of floor production, and the rise in floor prices are also irreversible trends. Under the premise of improving the quality of the floor, the price of the floor is properly floated to ensure the company's original profit margins. I believe most consumers can understand it. From this perspective, it is particularly important for flooring companies to properly guide consumers.

In fact, the "price war" consumers of floor businesses are not necessarily beneficiaries. Endless price war is a vicious cycle. Consumers get low prices for a while, but they can't guarantee the quality of their products. Not to mention after-sales services, the image of the final brand is damaged, and they fall into an abyss where they can't extricate themselves. Companies need to be responsible. In addition to providing quality products to the market, they must also positively guide consumers. Just as the new floor floor general Feng said, when profits are reduced, we must seek a breakthrough instead of endlessly playing a "price war." With the improvement of living standards, consumers are more inclined to enjoy the value of the floor, not just look at the price.

To sum up, the era of profiteering in the flooring industry has become a thing of the past, and the current low profits of the flooring industry are indeed facts. In the face of reality, companies can no longer sink in endless price wars. To maintain a reasonable profit margin, companies need to make in-depth reflections and grasp the market demand in order to find a way out.