Low-level flooring market is favored
It is understood that the pressure on the price of flooring products, coupled with high operating costs, so that dealers profit margins shrink. Because manufacturers have certain requirements for first-tier and second-tier cities and dealers, some even require big stores. Usually, the investment in large-scale stores is relatively large, and the decoration and design fee manufacturers often use subsidy or rebates. Greater operational risk.
Some floor dealers revealed that in the off-season, the sales of big stores are not enough to pay rent and property costs. From the perspective of input-output ratio, the efficiency of the floor retail market in the first and second-tier cities is very low.
With the increase in the consumption capacity of building materials for grades 3 and 4 in counties and rural areas, the demand for products based on laminate flooring has kept growing, and with the small amount of dealers' input and risks taken, the 3rd and 4th markets have become the most promising retailers of flooring companies. In the terminal market, most of the three or four-tier markets have greater price elasticity for flooring products. Therefore, the second-tier brands with small brand added value are more advantageous than the first-tier brands.
Whether it is necessary to increase the price of competition in the flooring industry?
Due to the rise of raw materials and the increase in the regulation of the property market, the flooring industry is not optimistic. In the face of the most stringent regulation of the “State of the Eight†property market, the trading volume of commercial housing and second-hand housing in major cities has a direct impact on the downstream building materials industry. According to report, at present, there are more than 3,000 wooden floor companies with highly homogenous products, marketing imitations, and heavy sales of light services. This has made it difficult for the flooring industry to face competition, inflation, raw materials and labor costs. In 2011, it became a difficult year for flooring companies. Should the floor price increase be wrong?
Flooring companies also need to develop hardcover housing channels
As a result of the policies of hardcover houses, building materials companies have adjusted their business models. As the retail market has become more and more squeezed, floor companies have started to jointly develop the channels through sophisticated decoration markets.
Floor prices have not been raised yet
With the fierce competition in the industry and the increase in cost, the floor terminal sales prices are facing upward pressure, but compared with the overall price increase of furniture and building materials, the price of flooring products has not risen. The overall cost of floor products increased by about 5%, but so far the company has not made any price adjustments. Many people in charge of floor companies have said that they will not adjust the floor price and will relieve pressure by increasing brand value. At present, most brands have no plans to increase prices, because many brands allow consumers to have strong bargaining power. “Imagine that floor prices are hard to rise, one brand increases prices, five brands promote, and floor prices rise.†Someone will certainly not pay for it."