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Future management mode analysis of domestic cable industry

Information Source:Henan Huadong Cable Co., Ltd  Release date:2014-04-28

The current Chinese wire and cable market is domestic trouble and foreign invasion, their main worry is the increasing competition, wire and cable industry Chinese has entered a stage of structural overcapacity, which means that the only production management mode, in the current market, business has become very difficult. Especially for the low-end cable production of small and medium enterprises, if not through the transformation and upgrading and the development of new products to change the current management situation, for the future development may be unbearable to contemplate. In addition, the market downturn, grasp the high-end technology of foreign cable companies come in great numbers, eroding the Chinese cable market, the backlog of profit rate, hinder the development of the domestic cable industry.

Of course, that the current status of Chinese wire and cable industry is not optimistic, the purpose is not to sing empty domestic cable industry, only hope that more and more manufacturers to "be prepared", even "better", is the only way to help the domestic cable industry bigger and stronger, to help domestic cable production enterprises become a world-class enterprise.

Hark back to the subject, because the current domestic wire and cable industry has been facing many difficulties, therefore, some in the industry of cable production enterprises have turned their attention to high-end products or special product line, go specialization strategy. Some other large cable production enterprises through high-end products or special product line, go specialization strategy, to change the business strategy.

Profit pattern innovation

Business strategies change not only means that the means of management needs to change, risk analysis and risk also requires the production of wire and cable enterprises more and more to avoid. For example, wire and cable industry needs and raw material manufacturers to establish risk control system good, avoid the risk of fluctuations in the prices of raw materials with suppliers to sign long-term supply agreement, hedging, futures trading contract etc.. In addition, the centralized procurement mode, promote the company and supplier's bargaining position, strengthen and improve the system and mechanism of risk control of raw materials. Only from the production itself, combined with the specific circumstances of the upstream and downstream, to avoid the risk of norm setting, system science, can help enterprises to go more stable.

In many business strategy, I prefer the electronic commerce mode of wire and cable industry. America Microsoft Corp founder Bill Gates had stressed that, in twenty-first Century, or electronic commerce, or no business can service! Electronic commerce is the inevitable trend of development of future business, is also a kind of the broader public can, in a more convenient way to carry out the business mode of operation, so the electronic commerce in the wire and cable industry, has a good development prospect.

According to relevant statistics, in recent years, China electronic commerce annual growth rate of more than 30%, as of 2013 June, the national e-commerce market scale reached 4.35 yuan, an increase of up to 24.3%. From the Chinese Electronic Commerce Research Center released the "2013 (on) Chinese e-commerce market data monitoring report" shows, the first half of last year B2B transactions amounted to 3.4 yuan, an increase of 15.25%.

In the domestic each big industry towards a business background, wire and cable industry involved in electronic commerce is inevitable, in the wire and cable industry business of road appeared the following modes: one is "distribution pattern" from the manufacturers to purchase products to sell to earn post; another is to provide business platform for manufacturers of direct shop "Taobao mode"; and finally the manufacturers directly to the creation of the Internet shopping mall "brand marketing mode".

Mergers and acquisitions to accelerate

Future, the domestic wire and cable industry in addition to business strategy changes, the process will continue to accelerate the merger and reorganization. With the change of global economy, in recent years, the rapid development of China wire and cable industry, production capacity of the industry demand is much higher than the industry as a whole, and the equipment utilization rate is only 30%-40%. A period in the future, the main trend of wire and cable industry is the integration, mergers and reorganization among enterprises. In the foreign enterprises to enter the market situation, Chinese wire and cable companies are concentrated to the private and foreign or joint venture enterprise. Industrial concentration in the fierce competition will continue to improve, wire and cable industry will face restructuring, shuffle.

In the "Twelfth Five Year Plan" period, China wire and cable industry is likely to make only superficial changes, especially a possible global cable giant. The current number of large enterprises and strive to become bigger and stronger, and continuously optimize the industrial structure, the formation of large enterprise groups 3 to 5 home sales reached hundreds of billion yuan and has a certain international competitiveness may be formed within the industry; 6 to 12 home sales reached 10000000000 Yuan and the specialized characteristic enterprise with strong international competitiveness in the professional products in the fields of regional cable; the formation of industrial clusters a number of unique products, professional manufacturing capability, supporting more complete, the different development; to form a number of characteristics of professional production and regional competitive advantage of small and medium enterprises.

The cable companies to increase

In addition, the regional distribution of cable companies, the eastern region will be Chinese wire and cable industry production and consumption areas important. In order to better meet market demand, the industry as a whole industrial chain development is relatively perfect, enterprises pay more attention to the construction technology and brand, the industry will gradually to the regional environmental protection and the development of high-end; moreover, due to the rapid development is western big development, Xinjiang, Chengdu Chongqing Economic Circle, regional economy, the wire and cable products demand has maintained rapid growth. Then in view of logistics and environmental reasons, there may be more groups would consider the factory moved to the midwest.

Generally speaking, China wire and cable industry after the rapid and extensive development, in recent years into the deep water area, also is in the "off" period, this is the history of the development process of decision, any industry must go through this stage. With the Chinese wire and cable industry through continuous self-improvement, transformation and upgrading, to seek new business model or optimize the existing business model, merger and reorganization, the survival of the fittest, will usher in a new round of rapid development. Therefore, the author predicts that, in the next 3 to 5 years, Chinese production of wire and cable industry will be rapid development, then China very likely more than a world-class scale enterprises, thus changing the Chinese wire and cable industry "big but not strong" look.

HUADONG Henan Huadong cable group is specialized in the research,development,and production of ABC Cable,Rubber Cable, mv medium voltage power cable,Control/Instrumentation Cable,Mining Cable, Bare Conductor(AAC/AAAC/ACSR/ACS), Huadong Cable Supply the price of 16mm armoured cable,Mc Interlocked Cable, 4 core 240 mm cable price at competitive.
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