Small and medium-sized household appliances will have annual revenue of over 170 billion yuan

If nothing else, in 2011 China's small appliance industry revenue is expected to exceed 170 billion yuan. This market, known as the ultimate source of profit for China's home appliance industry, is spurring companies to compete fast. They are either expanding their product lines, sinking channels, or going public, etc., in order to transform themselves into leading brands.

The leader of the United States, the most fierce momentum, after integrating its small household appliances marketing resources, it accelerated the construction of stores; Galanz is not satisfied to do the microwave oven boss, in August will be tens of thousands of Purchasing Guide to become regular workers, want to live in the kitchen small appliances comprehensive Forces; Wanjiale is extending from water heaters to kitchen appliances and household appliances; Wanhe is expanding into kitchen appliances.

"First Financial Daily" reporter on the 22nd to the United States of China Household Appliances Group, China Marketing Headquarters interview found that prominent position in the lobby placed "beautiful integrated electrical appliance store Kanban", the daily display of the store's latest developments. Zhu Yuanlai, head of public relations at the marketing headquarters, revealed that currently there are about 6,000 stores in the United States, which will grow to 20,000 in three years.

In December last year, the China Marketing Headquarters of Midea Household Appliances Group was established, breaking the previous single-battle situation of small home appliance product lines, setting up sales companies, and establishing 60 regional sales companies nationwide.

After the marketing revolution, Midea’s small home appliances cancelled distributors at all levels, submerged the decision-making power of the marketing business to the regional sales company, and the authority of the agents sank to the county and townships, and the integrated stores opened to townships and towns. The sales company is jointly established by Midea and local powerful distributors. The representatives of the distributors serve as the chairman of the board and Midea is assigned to the general manager to strengthen the management and control of the channels.

In the first quarter of this year, Midea’s small home appliances have tasted the integration of resources and the sweetness of channel sinking. Midea’s China Marketing Headquarters for Home Appliances proposes a new strategic goal: By 2015, it will achieve sales revenue of 40 billion yuan and operating profit of 4 billion yuan, accounting for more than one-third of China’s small household appliance market.

The beautiful city's brother Galanz is also ambitious and hopes to extend its advantages to other small household appliances with its leading strength in microwave ovens. A few months ago, Galanz integrated marketing resources for microwave ovens, living appliances and kitchen appliances. Liang Hongsheng, general manager of Galanz Life Appliance China Market Sales Co., Ltd., came to lead the effort.

In August of this year, Galanz will fight more than 10,000 promoters in the retail sector of microwave ovens and other small household electrical appliances. All of them will be changed from temporary workers or laborers to formal employees of Galanz. In addition to wages, various kinds of social insurance are also purchased for promoters. Behind Galanz’s “going home” for promoters is its new strategy of transforming itself into an integrated white goods company.

Galanz’s vice president and press spokesperson Lu Yulie introduced that the company hopes to achieve a sales scale of RMB 100 billion during the “Twelfth Five-Year Plan” period, in which small household appliances and air-freezing will each occupy half of the country. In small household appliances, domestic sales of microwave ovens are planned to reach 15 billion yuan, and domestic sales of other small home appliances will reach 10 billion yuan. In line with the new strategy, Galanz is working hard to open a full-line integrated specialty store.

Liang Hongsheng believes that after nearly 10 years of rapid development in China's small household appliance industry, the market is shifting from a hundred disputes to the era of big brand intensive, and consumption has also started to shift from sporadic purchase to one-stop purchase.

The data from Beijing Zhongyekang Times Market Research Company also confirms this. Peng Ye, research director of Zhongkang Market, told this reporter that small appliances grew faster than white goods and black appliances, with an annual growth rate of more than 10%. The sales volume of small household appliances in China was 160.5 billion yuan in 2010; it reached 115.7 billion yuan in the first eight months of this year, and it is conservatively estimated that it will exceed 170 billion yuan in 2011.

Peng Yu said that the current domestic market in a number of small household electrical appliance products, there have been duopoly competition. For example, Galanz and Midea already account for 90% of the market for microwave ovens. The market share of electric rice cookers and electric pressure cookers in Midea and Supor has exceeded 60%. The market share of soybean milk in 9 Yangyang and Midea has reached 90%, and gas water heaters are produced by Wanhe, Macro control, occupy nearly 40% share.

“In the future, China’s small household appliances market will have three to five leading brands across product lines.” Peng Yu said that China’s small household electrical appliances category is high and the threshold is not high, and there may be dozens or even hundreds of small household appliance brands. An area of ​​small household appliances will be dominated by oligopolies.

Under this situation, local companies began to accelerate their product line expansion and sink channels. They have also begun to try to open up the capital channels and strengthen their capital strength. Following the landing of the small and medium-sized board at the beginning of Wanhe and Galanz, Galanz is actively pushing forward the listing process. The small home appliance business in the United States also has an IPO idea. While foreign investors continue to implement mergers and acquisitions integration, after Cyber’s acquisition of Supor and Philips’ purchase of Pentium, new integration actions are not ruled out.