China's floor industry reshuffle has continued to intensify the market's "Malt effect"

A few days ago, the reporter visited some building materials stores in Shanghai. Compared with before, the number of stores in the entire building materials market has decreased, but the area of ​​brand stores has expanded, and the level of decoration has further improved. The advertising resources near the building materials market are basically occupied by major brand companies. Workers on the square in front of the market are laying out the stage and the entire market is showing fierce competition. However, according to the reporter's observation at the Xiyingmen Woodworking Hall on Yishan Road, although a large number of small and medium-sized floor merchants have resorted to all kinds of promotions to hold various promotions, the popularity is significantly lower than that of the four-in-one and higher floors. According to people in the industry, the Matthew effect has already begun before the 5.1 Gold Shopping Festival is about to start. The concrete manifestation is that many consumers have gradually turned to a small number of big brands, and more and more consumers are willing to pay for the brand.

Probably from another side, this market trend can be better verified. At the 10th China International Flooring Materials and Paving Technology Exhibition (DACF) held in March of this year, famous floor companies such as Sihe, Shengxiang, and Anxin etc. It attracted a large number of domestic and foreign customers to visit and negotiate. Among them, Sihe Wood has absorbed orders from buyers from more than 50 countries all over the world and has caused a strong shock in the flooring industry. In stark contrast to this, some small and medium-sized companies have booths that can be used to sign up for orders.

Why does this Matthew effect appear in the market? According to the “Matthew effect” used in the sociology community, a more powerful company can make consumers feel more trustful, and the more consumers trust the company, the more favored consumers will be. Moreover, this situation is showing a gradually expanding trend.

According to Mr. Gao Zhihua, vice chairman of the floor circulation committee of China Timber Distribution Association, flooring is a resource industry. In recent years, as the price of wood in international raw material exporting countries has risen, it has become one of the limiting factors for the further development of the home furnishing industry. And in the next few years, raw materials such as wood will continue to rise due to a worldwide shortage of resources. The shortage of resources has made home businesses more competitive. In order to solve the problem of supply of raw materials, some of the powerful companies such as Anxin Wood and Sihe Wood have begun to start from the source and set up raw material bases in timber exporting countries such as Russia and Brazil. In order to form a stable supply of upstream resources and effectively reduce the cost of raw materials. The advantages of upstream resources established by these large companies can give customers enough confidence and market guarantees. Therefore, in the current fierce competition in the flooring industry, the competition among enterprises is more of a game of capital. Franky, the Belgian general manager of Shanghai New Sihe Wood Co., Ltd., was very representative. At a home furnishing forum held recently at home furnishing, Mr. Franky said in response to a reporter’s question on the same question: “Very Simple, companies need to do big, they need money, and VC can solve this problem for us."

Second, the frequent trade disputes and disputes over intellectual property rights in the international market have further reduced the space for domestic small and medium-sized flooring companies. Most of the small and medium-sized flooring companies in China do not have their own core technologies and patent intellectual property rights. After being investigated by the United States "337", it had to withdraw from the international market. Originally, these companies could rely on the profits derived from floor exports and then invest in the domestic market to run their brands. However, after losing its source of profit in the international market, it has to implement a monetary tightening policy. At the same time, some large brand companies simply do not have such obstacles. For example, Sihe Wood owns a number of important invention patents, and it has imported lock patents from Volinge in Europe on key lock technology. To ensure the competitive advantage in the international market!

Finally, the upgrade trend of wood flooring products and the country’s related guidance policies have also promoted the development of companies such as Sihei flooring that are known for their technological products. It is reported that China's taxation policy on the flooring industry has been adjusted several times so far. Some wood products including solid wood flooring and engineered wood flooring have been included in the levying of consumption tax, and 5% of consumption tax has been imposed on exports of solid wood composite flooring. The tax refund is from 13% to the final cancellation. The adjustment of a series of policies fully proves that the country has a policy of restricting consumption of wood products and encourages resource-saving floor consumption concepts. Under this premise, coupled with products such as three-story, multi-layer solid wood flooring and other wood products with high utilization rate, there is ample room for development.

Objectively speaking, the Matthew effect in the floor market has concentrated resources on a small number of powerful and well-managed companies. This not only helps these companies become bigger and stronger, but also establishes the brand of a national enterprise, and it is also more conducive to regulating the current confusion. Flooring market. Recently, new news came from the U.S. capital market: The well-known U.S. DCM investment company teamed up with Lenovo VC to jointly inject US$15 million into Shanghai New Sihe Wood Co., Ltd. It is reported that this is the company's return to Lenovo VC's investment of 20 million U.S. dollars in October last year, once again gaining favor from the capital market. As a result, Shanghai Xin Sihe Wood has become one of the companies that have gained the most investment in China's flooring industry. Both parties recently signed an agreement in Shanghai. So far, the Matthew effect brought to the flooring industry by the capital market has emerged, and the strong has become stronger. Shanghai Xin Sihe Wood has had the previous capital and outstanding performance at the Hannover and Shanghai Flooring Show. The capital of Lower Wall Street is a matter of course.