LED lighting information symmetry and channel flat

The flattening of the channels must be closely linked with the information. Information is asymmetric and channels are never flattened. The biggest feature of the Internet era is information transparency, so it will be harder and harder for mediation businesses to move through wholesale distribution. Wholesale business must be transformed. This is a major trend. However, the trend is not necessarily equal to immediately.

Essentially speaking, the wholesale business of the lighting and lighting industry has been able to achieve rapid development because of information asymmetry and because of the retailer's demand for services. It is precisely because of this that our industry has had so many provincial general and interprovincial agents in the last 30 years. This was determined by the development needs and development status of the entire industry at that time.

Today, the entire industry has undergone tremendous changes. The flattening of channels has been practiced for many years. Numerous manufacturers have begun to provide specialty stores or direct supply in major provinces and cities, or choose small cities and districts as agents.

Isn't there a market for big regional logistics or provincial generations today? It is not. Not to mention that the industry has not yet reached that level. Even if 90% of the manufacturers have channels that are flattened, at least 10% of the manufacturers will require large regional agencies or provincial agencies. The status quo of the industry today is that at least 60% of companies still rely on industrial distribution centers such as Guzhen, Changzhou, Linyi, Xi’an, Shenyang, Zhengzhou, Chengdu, and Urumqi. If these distribution centers are not available, most enterprises cannot actually survive. . At least 70% of enterprises must also rely on provincial wholesale to bring their products to the county market. The real direct supply enterprises are still a small number of 30%. Professionals do professional things, and they are eager to make a big loss. I still do not see how many companies have such an emboldened attitude, saying that I am adamantly not doing logistics, only direct supply, but he is just saying: look at the conditions to speak. If the opponent’s conditions are too high and the strength is not strong, I’m not accountable and I will not do it. If the other party is strong, the network of channels is strong, and the conditions are not harsh, why shouldn’t I do it?

In spite of this, the industry is indeed undergoing three major changes: more and more transparent information, more and more flat channels, wholesale and more logistics and service. Companies always want to win greater competitiveness, and prices are the most sensitive element and the most direct and effective weapon, so the more involved links, the higher the cost. Therefore, manufacturers are looking for a breakthrough, hoping to have greater price competitiveness, choose direct supply; dealers want to get their own factory price, so strongly encourage manufacturers to supply.

The symmetry of information (transparency) makes wholesalers unprofitable, and the flattening of channels will eventually cause a large number of wholesale markets to go bankrupt, go bankrupt or change jobs, and a large number of wholesalers will also be forced to change jobs. What do you do? Change to do logistics distribution and services. Especially after the rise of e-commerce, this trend will become more apparent.

However, direct supply is certainly good, but we will face a lot of problems: 1. How to solve the speed problem in the long distance? 2. Can a manufacturer or a merchant have the ability to solve inventory problems? 3. If you encounter weather, traffic, or accidents, how can you solve the problem of protection? 4. How to solve the issue of waiting for consumers in the distant future if replacement parts are needed? 5. Faced with a large number of scattered orders every day, direct supply requires a strong order processing, production planning, logistics and distribution, and customer service center systems. Can the manufacturers establish and maintain normal operations?

Therefore, direct supply is a trend, but it is not necessarily a reality, at least not everyone's reality. Just as e-commerce is a trend nowadays, it has not reached the point where the traditional industry is immediately overturned. Only when the manufacturers do all the preparations, after all the conditions are ripe, direct supply is the mainstream. Only when everyone begins to shop online, traditional businesses have no business to do. The premise is still that when mobile Internet shopping becomes mainstream, logistics can cover communities and villages. When logistics (self-operating and third-party logistics) and services are insufficient, e-commerce will not be strong enough and traditional businesses will not be extinguished.