Six major effects determine the ups and downs of the electromechanical hardware and other corporate markets

In the 30 years of reform and opening up, due to the scale effect, it has made remarkable achievements and made a lot of contributions to society. The Chinese hardware industry has developed rapidly in recent years and has formed a complete set of tool hardware, daily hardware, electromechanical hardware, stainless steel hardware, and abrasive mold hardware. Industry categories, and formed a large number of unique industrial bases, such as Guangdong Zhongshan Siu Lam formed a lock, gas appliances as a leader, the upstream and downstream products and various accessories complete industrial clusters. The Hardware City, including Guangdong Hardware City and Guangdong Mechanical and Electrical Hardware City, formed the center of trade activities, gathered together, and had a strong scale effect, which provided a strong backing for the rapid development of Guangdong. Luo Baihui, head of the International Die and Plastic Hardware Industry Suppliers Association, believes that the marketing and development of hardware companies need to take into account various value effects. For example, the economies of scale formed in the Pearl River Delta region and the resulting benefits are obvious to all. Hardware companies should pay more attention to the value brought by scale effect, which is also the only way for hardware companies to develop.

The six major effects determine the hardware business market Shenwu hardware companies marketing and development need to take into account a variety of value effects, such as the scale effect of the formation of the Pearl River Delta region and the resulting benefits are obvious to all, and some large hardware companies should pay attention to scale The value brought by the effect is also the only way for the development of hardware companies.

1, leading effect.

One step ahead, step by step. Step by step, first, this effect applies to the hardware market, in a specific environment, because a particular technology or brand leading other companies in the same industry will inevitably drive the development of the entire enterprise. For example, hardware locks, hardware locks can be found everywhere in the hardware market, branded, unbranded, in short, a mixed bag, once a hardware lock company has an advanced patented technology, invented a new product, with This kind of new product puts on the market and obtains the good economic efficiency, this kind of leading product will inevitably drive the hardware lock enterprise's overall development, and has given a great step to the success that the industry produces first.

2, lock effect.

When users move from one brand of technology to another, they will certainly pay a certain cost for this transfer. When the transfer cost is too high and users lose their feet, the user is locked. When a high-tech product is successfully developed and wins the market, it can easily grasp the future market and take the initiative in fierce competition. This is also applicable to the hardware market, first investment, because the hardware cost is too high, will inevitably be daunted by the user, but once this hardware product is recognized, then this hardware product must lead the industry and promote the development of the industry.

3. The Matthew effect This is an era where winners take all-or-nothing. Rich people enjoy more resources - money, honor and status. The poor have nothing. The poorer the poor, the richer the richer. People with many friends will make frequent contacts to make more friends, while those who lack friends will always be alone; those who have a reputation will have more chances to appear, and therefore will be more famous.

4, gear effect.

Large enterprises do not develop, and once they are developed, small businesses are left behind. The gear effect is also applicable in the hardware market. Some large companies have advantages in terms of resources, money, contacts, and information. Once they are developed, they will take a big step. Small companies will be affected by resources such as funds, talent, and information. Limited development is slow, even halting. Such large companies have increasingly surpassed small businesses in the industry and have gradually become industry leaders.

5, aggregation effect.

The more companies with outstanding performance and abundant funds, the more banks want to give it premiums, which is the effect of capital accumulation. Under the financial crisis, some large-scale hardware companies have achieved outstanding performance. Once a financial problem arises, no matter whether it is through the bank or other companies' shares, it will correspondingly alleviate the current predicament, and will inevitably make it easier to collect funds. Once some small hardware companies encounter financial problems It is almost impossible to move. Chinalco’s $19.5 billion investment in Rio Tinto and the highest record of overseas investment by Chinese companies were again refreshed by Chinalco. Although Chinalco purchased a 12% stake in Rio Tinto in the United States on February 1, 2008 for US$14.05 billion, it has become the biggest loss overseas investment by Chinese companies so far. Apart from other complicated factors, no one can deny that Chinalco has taken a fancy to the fact that Rio Tinto is one of the world’s three largest iron ore giants. The famous students are already out. Chinalco’s risk of losing everything is solemn. Shares Rio Tinto. The better the performance, the easier it will be to congregate funds.

6, the scale effect.

When corporate production reaches or exceeds the break-even point, economies of scale are achieved. Because any production is costful, it generally includes fixed costs and variable costs. To achieve profitability, the sales revenue must be greater than the production cost, and the fixed costs among them are constant, so the more production, the less the fixed costs allocated to a single product and the more profitable.

Innovative technology and brand is the only way to build a powerful country of hardware. After more than 30 years of hard work, the Chinese hardware industry has become a veritable hardware country. After joining the WTO, with the reduction of import tariffs, foreign high-quality hardware products will be driven straight into China’s hardware companies. The transformation of the "Hardware Power" into a "Hardware Powerhouse" requires the expansion of the brand and industrialization of the two wings. Luo Baihui, head of the International Die and Plastic Hardware Industry Suppliers Association pointed out that China's hardware products exports only earn 3% of total exports, not only the issue of technological content, but more importantly brand issues. The brand includes a lot of content, including services, reputation and so on. Reputation is golden, and honest business is fundamental. If we produce hardware products that don't carry people's brands, but sell them under their own brands, and they can sell at the same price as OEM, then our GDP will double. At the same time, to enlarge and strengthen China's hardware industry, the involvement of large consortia is a key factor. Japan’s Panasonic and Sony did not originally engage in electrical appliances, but they were a large consortium. After seeing the prospects for the development of household appliances, they all stepped in, and now they dominate the world.

With the continuous opening of the hardware market, business warfare has intensified and a large number of foreign hardware companies have entered the Chinese market to open up new fields. Faced with market competition that competes with each other, how to be invincible in such fierce competition has become a problem that all high-level decision makers in hardware companies have to consider. Creating China's own brands that are commensurate with the market is an issue that we urgently need to address. With the entry of the WTO, a large number of well-known international brands will also be flooded into China. This is what we often call the "wolf." "The wolf is coming" is nothing terrible. The key is that we must have a very good chance to block it. The development of the production and marketing of China's hardware industry must follow the domestic and international trends towards internationalization, and the new marketing ---- to stimulate the development of enterprises, to create an international concept. At present, China's hardware products have hardly ever played an international brand. Like Zhejiang Yongkang, although it enjoys a good reputation at home, it is still Zhejiang Yongkang, not China's Yongkang, and has not yet gone abroad. It is believed that after a period of hard work, there will be more and more brands of Chinese hardware products in the international community.