Chinese LED lighting industry to be solved mystery TOP10

The vigorous 2012 has already passed quietly. During this arduous year, we have experienced events such as “NVC storms,” “Foshan Incident,” “incineration of incandescent lamps,” and “billion-dollar enterprise failures.” Incidentally survived the tough 2012 doomsday. Some problems and bottlenecks can be solved, but some will follow 2013 with the arrival of the new year. Next, we will take stock of what “problems to be solved” in the Chinese LED lighting industry in the new year.

First, how LED lighting industry to enter the rural market?

For such a tempting "Sweet Potato" in the rural market, LED lighting will not be missed. Many media have said that the LED lighting market will stage a "countryside surrounded by cities." Although the cake is tempting and the opportunity is great, chance and risk often coexist. First of all, China's rural market has huge differences in the climate between the north and the south, geographical and cultural differences, and consumer culture are all sorts of strange things. Therefore, opening markets to rural areas is a great opportunity, but it also faces the same huge challenges. Second, to develop new markets, the strength of dealers can not be ignored. There are very few local agents with sales channels, sales networks and sales experience. Even if a company is interested in developing a rural market, the issue of investment promotion has become an insurmountable threshold. For some LED lighting companies, know how to seize the opportunity and meet the challenges, then the rural market is bound to be the last big cake of the LED lighting industry, how to achieve "turning overtake" depends on how LED lighting companies seize these opportunities.

In any case, the rural market with more than 900 million new farmers has entered rural areas under the favorable conditions of policy tilting toward rural areas, and under the conditions of increasing peasant incomes, especially during the cold winter of the LED industry, and losses caused by losses. Undoubtedly, it is a wise choice for the economy to enter the winter to find a warm source. Because this is a corner that has been forgotten by people in cities and cities. It is so close and so far; it is so big, but it is so small.

What products, services, prices, and ways to enter the countryside are all questions that must be answered. In rural areas, don’t say anything else. “Price is the king” is the golden rule. Can you lower your identity and first be competitive with opponents you don’t care about? If you lower your identity, how can you have a price that you can't imagine to compete with a home-grown company? It is not easy to do this.

In 2013, it will become the LED lighting channel construction year. How to get out of the road of "encircling the cities in the countryside and seizing political power by armed forces" is a severe test for LED export-to-domestic enterprises and a way out for salvation.

Second, LED into the private electricity supplier platform into a springboard?

At present, large-scale traditional lighting enterprises still hold the main channels, and distribution by agents throughout the country is the best choice for traditional lighting companies. For example, NVC Lighting has 11 operation centers across the country, laying outlets at the county level, with a total of more than 10,000; Op Lighting has 10,000 direct sales stores or franchise stores across the country, and it has almost reached the national level market. Covering... In cooperation with designers, design institutes, and large-scale project projects, it also has a unique advantage.

Compared with traditional channels, e-commerce has two characteristics: First, there are no regional restrictions, and the audience is broad; second, it shortens intermediate circulation links and achieves flat management. This is undoubtedly an opportunity for emerging LED companies that do not occupy traditional channels. Because it is very difficult to enter the traditional channels quickly and with large traditional lighting companies. The low cost and wide coverage of e-commerce have become extremely attractive. Therefore, some emerging LED companies are quite fond of e-commerce.

However, with respect to emerging LED companies, large companies with traditional channels are not calm. The non-negligible effect of online sales has enabled major lighting companies to accelerate the layout of e-commerce. There are several ways in which: First, the cooperation with third-party e-commerce platforms, such as Taobao, Alibaba, Jingdong, Pat Net, etc., to establish their own B2C flagship mall. The second is to choose Media Home Mall. For example, NVC Lighting, Philips, and Langon opened a store in a media home shopping mall. Third, companies do not rely on any platform, establish official websites, and sell products on the official website. In general, several methods are carried out synchronously and omni-directionally. Competing for online sales is a relatively common phenomenon.

However, some people in the industry did not agree with this phenomenon. Xia Siyuan, director of the office of Snowlight Lighting Division, believes: "At present, most of the LED shops that are doing better on Taobao or other malls are some kind of no-name brands, mainly for some 80, 90, and sales are good for some conventional products. Most of the large-scale LED lighting companies still rely on traditional channels, and even if they have stores, there are more dealers, and the focus of the company is still on the traditional channels. After all, lighting is still an experiential product, and consumers still pay more attention to offline experience. ."

However, in fact, online sales can not solve the offline service problem, a new model - O2O mode has emerged in the field of LED lighting e-commerce. The emerging business model of O2O is quite representative. The combination of online and offline interactions, online search for consumers, and offline purchases make the Internet a frontline for offline transactions. It is a combination of payment patterns and the creation of traffic by shop owners. . This new e-commerce model more satisfies consumers' demands for consumption. A LED lighting company executives believe that: "The emergence of O2O model, making many LED lighting companies in the e-commerce journey, shortened a large part."

Although the current LED consumer market has not yet demonstrated tremendous demand, the huge population base of the mainland, as well as increased living standards, increased awareness of energy conservation, and recognition of high-tech products are highly respected, heralding the infinite potential of the civilian market. In order to win the market, many LED lighting manufacturers in mainland China have also laid out their channels. Among them, most of the traditional lighting manufacturers choose to cut into the LED channel from the original traditional channels, while emerging LED manufacturers tend to be more efficient, efficient, and low-cost e-commerce platforms. Tuo believes that with the improvement of the mainland e-commerce platform and the rapid increase in the number of users, in 2013, “ecommerce + LED” will be a better way for LED to enter the civilian market. No matter the emerging LED manufacturers or traditional lighting manufacturers, they will do their work on the e-commerce platform.

Third, the combination of strengths and strengths will become a new trend in the LED industry

In 2012, China's LED industry shuffled for a year. The tide of industry mergers and acquisitions began to accelerate from the middle of the year. With BDO Runda lighting shares in NVC lighting, mergers and acquisitions tide has gradually entered the climax stage. Yesterday, BDO Runda (002005) announced that it plans to obtain a total of 20.05% of NVC Lighting's total share of approximately RMB1.343 billion through its wholly-owned subsidiary BDO Runda International (Hong Kong) Limited.

In the past two years, the plight of overcapacity in the LED industry, blind production, and a vicious price war not only has not been improved, but has intensified. In 2011, Shenzhen Duo Duoli, Vision Optoelectronics, and Zhongshan Kabang went bankrupt. In 2012, Haobo Optoelectronics, Big eye sector optoelectronics and other LED companies have experienced crises, but also make the sluggish LED industry worse, corporate mergers and acquisitions, integration and other phenomena are also common. With the combination of BDO Runda and NVC Lighting, the industry believes that it will accelerate the pace of mergers and acquisitions in the industry.

QinShang Optoelectronic recently issued an announcement that it will issue bonds with a total size of 800 million yuan, of which the first phase will raise 400 million yuan. According to a reporter from Xinshun Photoelectric Dongli Wei Li Express, the funds will be mainly used to improve the country's layout, timely mergers and acquisitions and the development of EMC (contract energy management) new business. “The company is currently looking for suitable acquisition targets from companies that have complementary properties in the LED industry chain and Qinshang Optoelectronics business. The targets include large companies and SMEs.”

In addition, Zheng Tiemin, chairman of Shandong Inspur Huaguang Optoelectronics Co., Ltd., also said in an interview with the media that the focus of Inspur Huaguang's development is mainly on the upstream of the LED industry. Currently, there are plans for mergers and acquisitions to integrate midstream packaging companies.

“The LED industry has high cash and technical requirements for companies. With the introduction of a series of LED support policies this year and the gradual implementation of the company, some companies that have won bids but lacked sufficient funds or technology to complete projects will seek to introduce partners, so the current industry The phenomenon of integration.” Wei Li believes that due to the intense competition in the LED industry and the lack of competitiveness to live, it is expected that the industry's strong alliances will be the general trend of mergers and acquisitions among companies.

4. Has the "price war" continued to deepen or has it turned to "value warfare?"

In 2012, for many LED companies, fierce price warfare and tender bidding seemed to be the main form of market competition, and the quality of products, brands, and so on that really related to the sound development of an industry can be said to be many in the industry. The company "ignored" it.

If we say that many of these are helpless and there are many objective and inevitable factors, then what will be meant for the LED industry in 2013? The surging price war will continue to deepen, or it may turn to pay more attention to quality and brands. "Value War"? Turn to branding, technology and quality?

It can be foreseen that "efforts to increase corporate profits in the face of increasing price competition will be the main theme under the premise of a stable market". For the market competition in 2013, the price war under the background of homogenization will continue, but the market competition is not only a simple competition between enterprises, the competition of the industry's ecological chain is equally prominent.

As far as the chip industry is concerned, it can be predicted that in the future, the mainland LED chip manufacturers will struggle in the ever-released production capacity and homogenization environment in 2013. In addition, the mainland will announce the limited opening of Taiwan's LED lighting standard certification in the near future. The applications that can be immediately adopted by the mainland and open to Taiwan will inevitably make the future market competition environment more intense, and the price war will continue to deepen.

For application companies, in 2013, the price decline will still be the main theme. “Fozhao, Huaqiang, etc. are already in action. I have already seen 3W bulbs below 6 yuan in the market”, an LED company. Marketers reflect the price changes in the market in this way, and at this time it depends on who can combine the best quality and price.

"Price warfare is not very much related to the middle and high-end. Cost control and differentiation are always right. Creating value is always right, but the pricing of value is not under your control. When your main product is no longer competitive, it still has to be The main profit point is equal to the opening of the door. A small price war will make you fall into crisis," said an LED lighting company manager who expressed his own point of view. He also proposed that the company Say, at this time, the most important thing is to do a good product. The quality of the product and the corresponding technology are still the core level of differentiation. At the same time, the rhythm of the product's life cycle must keep up, because the market changes quickly and the cycle of the product is accelerated. Now.

In 2013, it will be destined to be a year of “surge”, and if there is a big wave of Ebbing, will the survival of the fittest be the same as stimulating the market to mature? "In 2013, it must be a year of precision marketing. LED manufacturers will face more severe competition than 2012. At this time, we are concerned about the country's support policies, and at the same time, we should stick to our own strategic direction and step by step." The entrepreneurs said in this way that companies must be invincible and must bring products with higher quality and process technology down to the market. They must have characteristic, high-tech product systems and have a three-dimensional product strategy. These are truly recognized by the market before they can truly realize their own rapid development.

At the same time, in 2013, more companies will begin to pay attention to the shaping of the brand, not only relying on the scale advantages of low prices, but also the brand advantages will become “the rising power behind the scale”.

V. How will the "business ideas and profit model" change, and is it possible for the vendors to bundle?

"Some people have seen the dramatic market changes. Someone is still aware of it. Some people still think that after a long time, good days will come again." And eventually, no matter when a good day will come or when it will come. In order to win the cruel market competition in 2013, the most important one is the innovation of business ideas and profit models.

This is also one of the most exciting and exciting aspects of change. Because this is not only for a company, but also for the development of the entire industry, business ideas and profit models are undoubtedly the top priority.

Various thoughts thus unfolded. For example, some people think that “doing a single product or two products” is the correct way of thinking for the factory, but what the terminal business wants is a full range of products; then, between the LED manufacturer and the terminal manufacturer, is there a need? Is there an integrated platform that can deliver the fine and specialized products of excellent manufacturers to the terminal in a timely manner? Who will be the platform for this? Is it a big brand e-commerce or a channel chain brand? Is there any possibility of a big alliance of dealers?

“Is it possible for the channel business alliance? Is it possible for the production companies to hold a group?” An LED entrepreneur also put forward such a constructive point of view. Even the resource sharing of traditional lighting companies and LED emerging companies, channel integration or acquisitions may? Is it possible for agents and production companies to hold shares with each other? LED product customization production is possible? There is no possibility for the marketing outsourcing of production companies. Obviously, these are all "in the future," and will be based on the overall maturity of the entire industry, higher integration, and various forms of cooperation based on mutual benefit and common development. "may".

An entrepreneur expressed his recognition of the idea that “manufacturers hold each other's shares”. “I think that in the current LED industry environment, companies and merchants should be deeply tied up to establish a new sales company. After all, the ability of the manufacturers is still reflected. In terms of manufacturing, sales are the strengths of businesses, so that manufacturers and sellers can perform their duties in a dedicated and dedicated manner.

It can be seen that at present, many dealers are investing in factories on a large scale, but the results are often unsatisfactory, and some manufacturers are also more than a sense of "marketing," if the depth of binding between manufacturers and merchants is a kind of Way out. Some people also said that the mode of bundling (combination of manufacturers) is still relatively large in the home appliance industry, and the lighting industry is still relatively small. The premise is that this model should be based on the depth of business understanding of manufacturers and affirmation.

"Everything is possible. Dealers have a share of the cooperative factory and are going to become a reality." An entrepreneur who has already walked on the road made his own answer.

In 2013, there will probably be more LED entrepreneurs on the road to change and exploration.

Regardless of how the industry's future changes, 2013 is cold, warm, sick, and slow. Both will place hope and imagination on the future. In 2013, LED entrepreneurs with social responsibility and professionalism will also be faithfully witnessed. The footsteps the makers are making as they move forward.

At the same time, we also wish that, like China's association, like TCL and Hisense, like Gree, in 2013, there will be LED industry brands worthy of long-term remember to hang on it.

6. How does the industry break through when the industry enters the era of meager profits?

“In the early days, there were very few companies that could enter the industry. In 1994, there were few in the country. Shenzhen was only two or three,” said Pang Guiwei. “At that time, due to the difficulties in the research and development of key technologies, almost all enterprises capable of producing LEDs had R&D capabilities, especially control technologies that were only in the hands of a few enterprises.”

In the 1990s, as a "scarcity product", LED only existed in a few places such as banks and stations, and due to the low prices of raw materials, the development of key technologies raised the terminal prices, which led to the LED industry becoming "expensive."

However, the competition among enterprises has aggravated the civilianization of the LED market. According to reports, since 1997, the market has begun to emerge with the technology transfer of key technologies such as single and dual color control cards, and by 2001 it has grown to the point where even color control cards are sold on the market.

By 2006, after the control card technology was gradually mass-marketed, the key technology R&D costs of the LED industry had been reduced to the lowest level, and the number of Chinese LED companies began to increase geometrically. A series of large-scale events such as the 2008 Beijing Olympic Games gave birth to the rapid development of LED companies and reached a peak in 2009.

"From 2007 to 2008, LED display prices were higher, and profit margins were larger. The gap in product prices between companies was also very large. With the continuous increase in the importance of consumers on product quality, the LED industry is also increasingly competitive. Fiercely, some small and medium-sized enterprises have been affected by price and scale. This is the most fundamental reason for the closure of some SMEs,” said Pang Guiwei.

Wang Dianyou, honorary president of the Shenzhen Semiconductor Lighting Industry Development Promotion Association, said that under the background of the bankruptcy of many small and large companies, such as Duo Duoli, Bolent, and Vision Electronics, there are not many unknown small companies that have fallen. The timing of reshuffling the LED display industry has matured, and once companies have made major operational mistakes, they will be swallowed up quickly.

Pang Guiwei believes that the lack of core technologies in the LED industry, lack of innovation capability, and disorderly market competition are all bearing on the development of the LED display industry. The price of LED industry has entered the era of "micro-profit", and we must make breakthroughs in product innovation.

7. How to solve the bottleneck of equipment and talents in all application fields?

Due to LED's energy saving, environmental protection, long life, and flexible use, LED products have expanded from initial signals and indications to display screens, landscape lighting, backlighting applications, and general lighting. They are widely used in indoor and outdoor large-screen displays and urban architectural landscapes. Lighting, mobile phones, notebooks, TV backlights, automotive lighting and solar LED lighting, road lighting, tunnels, industrial lighting, and some special lighting applications are also expanding their penetration.

After ten years of development, China's LED product applications have covered all of the above application areas, and more and more new applications have been developed. In the past two years, more and more applications have been invested in the fields of agricultural production of artificial light sources, medical light sources, etc. As more and more countries announced the phase-out of incandescent lamp projects, with the continuous improvement of LED performance and Prices continue to decrease, and energy-saving and environmental-friendly LEDs are gradually entering the general lighting field. Commercial stations such as gas stations, underground parking lots, hospitals, hotels, clubs, merchandise display cabinets, and office buildings have taken the lead in using white LEDs as general lighting.

At the same time, the lack of core technologies restricts the development of the company. The core technology of LED is mainly the control of epitaxial growth, the structural design of the chip and the manufacturing process. These core technologies are monopolized by a few foreign companies and are protected in the form of patents for a long period of time, resulting in a very passive state of technological development in China. The export of products was restricted, and the technological upgrades and product updates of enterprises were limited. Most of the products of the company were in the low-end level of homogeneity for a long time, resulting in a vicious competition situation.

The size of the company is still small. The characteristics of domestic LED companies are: the number of companies is large and small, whether it is the extension of previous processes, chips, or the encapsulation and application products of post-processes, this is the structural form, even if it is the largest LED company in China, and Compared with overseas counterparts, their scale is still much smaller. By the end of 2011, LED companies in the upper and middle reaches of the country have not had a company whose main business income exceeds 1 billion yuan. This type of enterprise will lack R&D strength, low product quality, lack of competitiveness in the market, and development of China's LED industry. It is very unfavorable.

Key raw materials and equipment cannot be self-sufficient. Most of the major equipment and instruments in China's LED industry chain currently rely on imports. Key raw materials, accessories, such as phosphors, sapphire, organic sources, arsine, phosphine, etc., rely on imports, MOCVD epitaxial equipment and some fully automated chip and packaging equipment also rely on imports, and the high price. The high-performance silicone and epoxy used in the packaging also depend on imports. In the long run, the product cost is too high and it is not competitive, which will restrict the whole process of LED industry development.

The lack of core technical personnel. There is a shortage of leading talents who have mastered the LED core technology in China and there are not enough talents to master the key technologies in the LED industry chain. This will restrict the technical upgrading of China's LED industry and it will be difficult to confront with foreign counterparts.

Eight, China's LED lighting industry brand strategy how to go?

The lighting industry in China has long been in the competitive status of international brands. Philips, Osram, GE, and other international giants rely on high-end international brand image to cover almost all of the lighting's category lines, and the only domestic company that can compete with them is NVC. Lighting category brands, the advantages focus on the market capacity of engineering and commercial lighting), Op (home lighting category brand, the advantages of focusing on terminal outlets and word of mouth), Qinshang Optoelectronics (led lighting brands, advantages focused on LED street lamps and LED outdoor Product) brands represented by the category. At present, the real sense of the domestic industry, a serious lack of brand names, and category integration, public branding will become the domestic industry leader in the category of brands to build the inevitable road, the brand category is still confused break.

Industry brands refer to brands that are known and recognized in the industry, and public brands are brands that the public knows and recognizes. When measured in terms of popular brands, China’s home appliances, IT, fast moving consumer goods, and automotive industries have established many well-known and widely trusted mass brands due to their early development and full competition. For example, computers have associations and household appliances have Haier’s. Air-conditioning has Gree, and Huawei has Huawei communications.

China's lighting industry has low social concerns and serious product homogeneity. There has been a large amount of unbranded, unbranded, and unbranded enterprises in the industry for a long time. Brand competition in the industry is in an extensive, homogenous, and low-efficiency stage. Lighting company brands are not established. As a result, it is impossible to form a brand effect and cannot enjoy brand premiums, and can only fall into the price war circle. It is clear that the industry brands are in urgent need of transitioning from the industry brands known to the industry to the general brands recognized by the general consumers. This is a common problem facing the lighting industry. .

At present, the brand of China's lighting industry is in the stage of transition from the industry brand to the public brand. With the continuous development of the lighting industry, the importance of lighting companies to build brands has formed a consensus in the industry, lighting companies also recognize that competition in the lighting industry has evolved from product competition, price competition to brand competition. But how to change from the industry brand to the public brand, the industry is very confused, many companies believe that celebrity endorsement, CCTV advertising, import CIS, is to do the brand, the lighting industry is still confused public brand break.

Nine, product quality worrying chaos how to solve the problem?

China's LED industry is currently in a stage of collective suicide. If we want to develop soundly, we must adhere to good quality, reasonable profits, and strictly adhere to our market position. Only in this way can the industry stop pain and companies can stop bleeding, otherwise they are destined to escape.

China's LED industry is like today's energy-saving lamp industry in 2004 and 2005. It is indeed a chaotic phenomenon.

The chaos is chaos in quality. The chaos of quality in the LED industry today is unprecedented. The appearance is almost the same, there is a difference in the inside. Consumers do not discriminate on the basis of their feelings and eyes, so they are frequently fooled. But ask yourself, do you have no responsibility for consumers? Being greedy for cheap is your biggest current newspaper!

The chaos is chaotic in price. The chaos of the price has caused the entire industry to suffer, and many companies are unable to hold on and are forced to follow suit. The same product, the price difference between well-known brands and unnamed small factories is 10-20 times, which makes consumers perplexed and brand manufacturers suffer. Although the low-cost small plants can survive, but can you afford to pay? ——What you can't make money, but you want to kill it so bloody!

The chaos is in the standard. The province has provincial standards, municipal and municipal standards, and often fights between the standards of various regions, making it impossible for consumers to judge and be at a loss. Experts quarreled, the association quarreled, and domestic quarrels with foreign countries. The disputes over the standards are frustrating, and it is very lively and frustrating.

The chaos is spreading. Everyone says that the quality of their products is the best and the price is optimal. But what actually happens is that even braggers themselves do not believe that what they say is true. The spit grows like a bullet, and consumers are the birds under the muzzle!

Ten, 95% of traditional lighting companies to LED transition?

"The next three years, there will be a lot of LED companies can not do it." Wu Yulin that.

LED has always been regarded as an emerging strategic industry, but this young industry is growing so heavy that many people did not anticipate. Many companies believe that LED lighting has not yet been popularized and that the entire market has been flooded with low-cost, low-quality products. The reshuffling and reshaping of the industry will be inevitable.

At the beginning of 2010, relevant industry organizations in the industry conducted a survey and forecast of the progress of replacing traditional lighting with LED lighting fixtures. The survey results showed that industry insiders are more optimistic about the progress of LED replacement for traditional lighting. Most of them think that within 3 years, LED lighting can replace traditional lighting up to 20%, and within 5 to 5 years, up to 50%, and 10 years later, up to 80%. And according to J. P Morgan estimates that semiconductor lighting sources will account for 50% of the global market share in 2014, and semiconductor lighting fixtures will account for 50% of the market in 2016.

For the rapid development of the domestic LED interior lighting market. The survey results also show that most people in the industry think that the occupancy of LED indoor lighting products in 2020 may reach 50%. To this end, some experts predict that the LED lighting market will gradually mature in the next 10 years, and it is also the most crucial 10 years for the transformation of traditional lighting into LED lighting.

The face of the national government "delicious" to promote the popularity of LED lighting, and LED lights "applaud", consumers face new things, dare to accept the situation. Traditional lighting companies are advancing in "contradictions", both wanting to seize "opportunity" and relying on traditional lighting business as a support. The difficult transition of traditional lighting company NVC Lighting is an example. After experiencing high-level turmoil, underlying strikes, and channel integration, it is still in the run-in period. Although the three senior executives are unanimously concentrating on developing LED lighting, the road is long and distant. , need to search from top to bottom. Therefore, traditional lighting companies how to balance the traditional lighting and LED lighting "shoufu attack" approach, how to better seize market opportunities, play channel advantages, to find a successful transformation of LED, is still a traditional lighting companies need to think about one of the issues.