In the recent past, the entire industry has not escaped from the impact of the financial crisis and has been trapped by the sharp fluctuations in copper prices.
The growth rate has obviously slowed down the wire and cable manufacturing industry, which is the largest share of the entire electrician industry and has achieved the largest total profit. According to the income from the main business of the electrical industry last year, the wire and cable industry accounts for about one quarter of the electrical industry in China.
In the first half of 2009, the growth rate of the wire and cable industry slowed down significantly, resulting in a negative growth phenomenon, which was also a major factor in the slowdown or even a significant drop in the growth of the electrical industry. According to statistics, the total profit of wire and cable manufacturing from January to May 2008 was 8.5194 million yuan, and the total profit from January to May of 2009 was 843.864 million yuan, a decrease of 81 million yuan over the same period of last year, a decrease of 1%.
Wire and cable is a typical "light heavy industry" industry, the price of raw materials often account for 70% to 80% of the total cost. According to the analysis, the development of the wire and cable manufacturing industry was severely hindered. In addition to the shrinkage of the domestic and foreign markets, the large fluctuations in copper prices also brought great difficulties to the business operations.
Taking copper prices as an example, from January to June 2008, the price of copper was between 62,000 and 65,000 yuan per ton, and from January to June 2009, it fell to 26,000 to 37,000 yuan per ton, with an average reduction of approximately 50%. The substantial price reduction of raw materials has led to a significant shrinkage in the value of products with a relatively large proportion of the cost of raw materials such as the wire and cable industry.
According to the estimation of wire and cable industry experts, from January to February of 2009, the value of products due to the decline of copper and aluminum prices decreased by about 30% compared with the same period of last year. In the first half of 2009, the amount of value still shrank. In addition, according to the export statistics of wire and cable, 2009-June 2009 exports of 632,382 tons, up to 396,535,350 US dollars, an average of 6,270 US dollars / ton, only from the average unit price of wire and cable products, a decrease of 9.4% over the previous year.
Exposure of many issues It is worth noting that the impact of the development of the wire and cable industry is not entirely due to external factors such as the financial crisis. Many problems in the industry's own development can not be ignored: First, most companies are small in size, the industry repeated investment, production Overcapacity. The lower entry barrier and the huge market space have attracted many companies. At present, the number of small and medium-sized wire and cable enterprises in China has reached 7,000, and the proliferation of companies has brought chaos in the industry. Second, the price war is still a magic weapon for the competition among many SMEs, and the quality risks increase. Due to the lack of research and development capabilities, it is only possible to make a fuss about low-end products. Some companies are able to provide ultra-low-cost products, is nothing more than make a fuss about the raw materials, the quality of their products can be imagined. Third, the core competitiveness of enterprise product R&D, production management, etc. needs to be improved.
And then, the rise in raw materials is even worse for wire and cable companies. At the same time, low-price competition continues. At present, many wire and cable companies barely survive. However, there are always two sides of the matter. Although low-price competition and price increase of raw materials make it difficult for many companies, it also provides an excellent opportunity for the wire and cable industry to shuffle.
The outlook is still optimistic. China's investment plan for boosting domestic demand and promoting the steady and rapid growth of the national economy is a four trillion yuan investment plan, which will undoubtedly greatly benefit the wire and cable industry. The investment and construction of many engineering projects will rapidly increase the demand for cables. At the same time, it will certainly promote the steady and rapid growth of the number of cable products such as construction, communications and railways.
In addition, with the process of urbanization, and the acceleration of power grid construction and transformation, it will certainly lead to a new round of booming domestic wire and cable industry. On the whole, the wire and cable industry is expected to pick up and the prospects are expected to rise.
Under the dual pressure of shrinking markets and sharp fluctuations in raw material prices, companies should formulate coping strategies as soon as possible and actively seek new breakthroughs. First of all, companies should review the situation, grasp the opportunities, and use the opportunities brought about by the crisis to adjust the structure of wire and cable products and market strategies; secondly, to further improve product quality and level and promote rational competition; and thirdly, increase domestic wire and cable products. The promotion of the brand; Fourth, improve the centripetal force and cohesion of the company's employees; Fifth, further improve the differentiated competition of wire and cable products, and continuously introduce new cable products that are marketable.
More importantly, companies must work hard on brand operations and management and services, and systematically and systematically conduct brand operations and brand management. Every year, cable companies should spend a certain amount of energy, financial resources and manpower on the brand. Whether it is on internal management or on marketing, whether it is for dealer management or direct market operation, it needs to put the brand of the enterprise. And the brand of the product is scientifically, systematically, and practically implanted in the process of market operation, effectively occupying a place in the cable market competition, and then striding toward the international market.
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