Opportunities and Challenges Faced by the "Twelfth Five-Year" Standard Parts Industry

In the five years of time, we have reaped success and joy, and we have experienced setbacks and experience. In 2010, when we stood at the junction of the “Eleventh Five-Year” and “Twelfth Five-Year”, do you also want to know: As a The industry is in the era of meager profits, the next five years, the development of China's standard parts industry in the end there is still much? In the next five years or even ten years, what are the trends in the standard parts industry? Where will the industry transition turn?

According to statistics, in 2009, the total amount of standard parts in China reached 5.3 million tons, and the sales income was 49 billion yuan. Among them, the total export of standard parts was 1.61 million tons, and the foreign exchange earned was 2.367 billion US dollars. By the first half of 2010, the total amount of national standard parts exceeded. 3 million tons, a year-on-year increase of more than 10%, is expected to reach 6 million tons this year. On the whole, the development momentum of the industry in 2010 was positive and the export growth momentum was strong.

Talking about the company's operating conditions this year, Ye Gaoding, sales manager of Ningbo Standard Parts Factory, said: "Our company's products are exported 99%, and the recent operating conditions are relatively good. The current orders have been scheduled for production until mid-January of next year and it is expected that this year the company will The sales amounted to nearly 100 million."

Liu Fulin, general manager of Dongtai Huawei Standard Parts Co., Ltd., told the author: “Our company’s performance this year has been greatly improved compared to previous years. The production plan has been arranged until mid-December. This year's export volume has increased slightly compared to last year, accounting for domestic sales. 62%, foreign sales accounted for 38%, and this year's sales are expected to reach nearly 150 million."

"Our company has a good sales situation this year. There are many orders and 20% of our products are exported. It is estimated that sales will reach more than 600 million in 2010," said Huang Cheng'an, general manager of Zhejiang Austrian Show Industry Co., Ltd.

The same situation favors more than just a few individual companies. According to a survey of Chinese standard parts enterprises, the Chinese standard parts writer found that many large-scale enterprises have reflected that the current order status is good, and some even do a good job of preparing for expansion. However, we have also found that under the influence of multiple factors such as the emergence of an endless stream of international trade barriers, fluctuations in the exchange rate of the RMB, rising raw material prices, increased labor costs, and energy-saving emission reductions, the profits of standard parts companies are getting thinner and thinner.

The person in charge of a standard factory in Dongguan complained in an interview: “Now that labor costs have risen, prices have risen, production costs have increased, and with the appreciation of the renminbi, our profits have become thinner and thinner. If we appreciate again, we will export orders. I didn't dare pick it up. Business is getting harder and harder now."

“The impact of RMB appreciation on our company is mainly reflected in the orders of some small customers, new customers and unstable customers. The exchange rate at the time of order confirmation and the exchange rate at the time of foreign exchange exchange will have certain differences, although it must be reserved at the time of quotation. The expected appreciation of space, but this loss is still more distressing for us, after all, this is a disguised loss of profits, and is flowing abroad, and even the profits of the original standard parts is not high.” Ningbo Standard Factory Ye, manager said.

When asked about the company’s response to the appreciation of the renminbi, Ye Gaoding said: “For some stable major customers of our company, we operate through the bank’s US dollar forward exchange rate lock. The bank only needs us to pay the deposit, not Any other costs will be incurred, which will not only facilitate the company's cost accounting, but also circumvent the US dollar exchange rate risk, so that our company will not have any concerns about exchange rate risk when undertaking large orders or long-term orders."

As for the current challenges faced by the industry, Ms. Chang Sihang, the person in charge of the 5th Suzhou Standard Parts Trade Fair Organizing Committee, expressed her views: “These unfavorable factors will gradually weaken the labor advantages of China's standard parts industry and reduce the competitiveness of our products. To get rid of the predicament, the key lies in the transformation and upgrading of the company itself, starting the brand, increasing the added value of products, and raising the price of the right to speak. At the same time, we must use current financial instruments to avoid exchange rate risks."

Early benefits from early transition Of course, not all standard parts companies are suffering due to these unfavorable factors. According to the author's understanding of the Chinese standard parts, some standard parts companies that have already begun to undergo transformation and upgrading have been under light pressure. less.

Mr. Liu of Dongtai Warwick told the author: “The financial crisis and these unfavorable factors have in turn prompted us to accelerate the pace of transformation and upgrading, continuously improve product quality, improve production processes and develop new products. The company’s future development focus is to increase brand influence. Further increase the investment in technical reform."

As for the development priorities of the “Twelfth Five-Year Plan”, Mr. Ye from Ningbo Standard Parts Factory introduced three points: 1. Integration of the current factory structure; 2. Further expansion of market expansion; 3. Innovation and management of technology The deepening of the control of the cost of existing products to strengthen control, improve product profitability and market competitiveness.

The transformation of the enterprise has also been supported by the market environment and national policies. The Ministry of Industry and Information Technology issued the “Industrial Rejuvenation Implementation Plan for Mechanical Components and Components Industry” issued in October of this year and proposes: Through three years of efforts, the manufacturing level of China’s machinery and basic parts and components will be significantly improved. The capability of independent innovation has been greatly improved, the unreasonable industrial structure has been improved, and the passive situation in which the development of basic parts and components industries is seriously lagging behind has gradually been reversed. Among them, the standard parts industry focuses on the development of automobile engine standard parts, large-size high-strength standard parts for wind power generation, nuclear power special standard parts, and aircraft-specific standard parts.

Huang Zong of Zhejiang Olympic Show pointed out in an interview that I am optimistic about the development of the standard parts industry during the “12th Five-Year Plan” period. The development potential of new energy sources such as high-speed rail, wind power and solar energy during the 12th Five-Year Plan period is very promising. The development of these industries is The need for standard parts, and the long years of investment, the demand for standard parts is obvious. What the “Twelfth Five-Year” Olympic Show is for us to do is adjust constantly according to changes in market demand and maintain our leading position in the industry.

To build a brand is just the right time, however, the industrial transformation and upgrading can not be done overnight, not want to turn will be able to get better. Regarding the transformation, Vice President Chang Si’an explained to the writer in the language of his image: “Transformation is like the destruction of butterflies and butterflies. Although the process is painful, it will be transformed into a beautiful butterfly after it is broken. The current Chinese standard industry is in In the transition period, standard parts companies should seize the golden opportunity of building the brand in the 12th Five-Year Plan and take the transformation road based on the characteristics of the company itself."

In this regard, Huang Cheng'an, the general manager of Zhejiang Olympic Show, also agreed. He said: "As a traditional industry, standard parts have developed into a meager profit industry, but standard parts are indispensable industrial necessities. The scope of use is very wide, which determines that the usage and demand of standard parts will continue to be constant. As a result, companies must move forward with cost internal management and brand building. Only in this way can they continue to grow and become bigger and stronger.”

"Of course, the brand can not be built in a day or two. It is a long-term task that requires you to maintain it at all times. It is not only the quality of your own products that is done, but also the company's advantage in the industry."

According to Liu Fulin, general manager of Dongtai Huawei, the first reaction of customers to the demand for products is the brand. It can be said that the brand is the direct performance of the product in the customer demand. We will increase the publicity efforts of well-known media in the industry such as China Standard Parts Network. Participate in major exhibitions including China Standard Parts Exhibition to enhance the company's brand image.

In the past, with the low labor cost, super imitation ability and abundant raw materials, we obtained the title of “World Factory”. However, it can be foreseen that these advantages will gradually be lost in the next five years or even ten years. The lack of brand dominance will become a weakness that restricts China's standard parts companies from continuing to grow. Nowadays, the industry is at a critical node, and creating a brand is imperative.

In recent years, China Standard Parts Exhibition has been increasingly sought after by entrepreneurs because of its strong brand advertising advantages. All major standard parts companies have adopted China Standard Parts Exhibition and spared no effort to improve their visibility and build their corporate image and brand.

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