China's LED lighting industry "ten big mysteries"

One, LED lighting industry to enter the rural market?

For such an attractive rural market "meat and potatoes", LED highbay lights will not miss, many of the media have said that the LED lighting market will be staged "encircling the cities." Although tempting cake, the opportunity is great, but often opportunities and risks coexist. First, China's rural market due to a large north-south differences in climate, geographical and cultural disparities, consumer humanities strange, deceased rural open up the market, although it is a great opportunity, but also facing the same challenge. Second, open up new markets, the strength of dealers underestimated. Sales channels, and sales network of local agents and sales experience few, even if the enterprise intention to develop the rural market, investment has become an insurmountable problem threshold. For some LED lighting companies, know how to seize opportunities, meet challenges, then inevitably the rural market is the LED lighting industry last one big cake, how to achieve "corner overtaking" LED lighting business to see how to seize these opportunities.

No matter what, this has more than 900 million new farmers in the rural market, in terms of policy to rural areas of good situation, increasing the income of the farmers under the conditions, especially in the LED industry experience winter, taking losses of difficulties, into the countryside, is undoubtedly the source of economy enters a warm winter look wise choice. Because this is a city and the city has long been forgotten corner. It was so close, yet so far away; it is so big, but is so small.

In what products, what services, what price, what way to go into the countryside, these are questions that must be answered. In rural areas, do not say anything else, "price is king" is the golden rule, you can lower status, first do with your dismissive competing against opponents do? Lowered his identity, how can we have you can not imagine price and the level of native enterprise a fight it? do that, no easy task.

2013 will be the construction of LED lighting sources. How to get out a "encircling the cities, the armed seizure of power" on the road, which is LED domestic export enterprises is a severe test, but also a way to seek salvation.

Second, LED electronic business platform into a springboard folk?

Currently, large traditional lighting companies still hold the main channel distribution through agents in the country is the best choice for the traditional lighting companies. For example NVC has 11 operations centers nationwide, will lay the towns a network, the number reached more than 10,000; Op lighting in the country has 10,000 outlets or stores, almost have three or four markets nationwide cover ...... And the designer, design institutes, large cooperation project, it also occupies a unique advantage.

Compared with the traditional channels, e-commerce has two characteristics: First, no regional restrictions, wide audience; two is to reduce intermediate circulation, to achieve flat management. This did not take the traditional channels of the emerging LED business is undoubtedly an opportunity. Because you want quick access to traditional channels, and with the large, traditional lighting companies have been very difficult. The e-commerce low cost, wide coverage features become very attractive. Thus some of the emerging LED business is quite in love with e-commerce.

But the relatively new LED enterprises, with traditional channels of large enterprises also did not calm. Online sales effect can not be ignored, making the layout of the major lighting companies accelerate e-commerce. Which is divided into several ways: First, cooperation with third-party e-commerce platform, such as Taobao, Alibaba, Jingdong, pat net, build their own B2C flagship store. Second, select the media Home Shopping Mall. For example NVC Lighting, Philips, Long can home in a media mall opened shop. Third, enterprises are not dependent on any platform, the establishment of the official website, the official website selling products. In general, several ways simultaneously, stationed round to compete for online sales share is relatively common phenomenon.

But insiders do not agree with this phenomenon. Wright Lighting Division Office Xia Siyuan said: "Currently on Taobao Mall do a better job, or other LED majority are some no-name stores, mainly targeted at some 80,90, selling well are some of the conventional products The vast majority of large-scale LED lighting companies still dominated by traditional channels, even if there is the shop, but also dealers are more companies focus on traditional channels still, after all, still experience lighting products, consumers still pay more attention to line experience . "

But in fact for online sales line services can not solve the problem, a new model - O2O mode in the LED lighting field of electronic commerce has emerged. O2O emerging business model is fairly representative, online and offline interactive combination of consumers looking online and offline to complete the purchase, so that Internet has become the front line transactions, the payment mode with the owner to create a combination of traffic . This new electric provider model, and more to meet consumer demand. An LED lighting business executives think: "O2O pattern generation, making many LED highbay lights business into e-commerce in the itinerary, shortened by a mile."

Although LED civilian market has not yet demonstrated the huge demand, but the continent's huge population base, and improving living standards, increase awareness of energy conservation, and the recognition of respected high-tech products, suggesting the infinite potential civilian market. In order to win the market, mainland China LED lighting manufacturers have numerous layout pathways. Choose among traditional lighting manufacturers mostly traditional path cut into the LED from the original path, while emerging LED manufacturers tend to be more fast, efficient, low-cost e-commerce platform. TRI believes that with the improvement of the mainland e-commerce platform, the number of users dramatically improved in 2013 "electricity suppliers + LED" LED into the civilian market will be a better way. Whether emerging LED manufacturers also traditional lighting manufacturers, will be in electronic business platform article on the homework.

Third, combining the strengths of LED industry will become a new trend?

2012 is the year of China's LED industry reshuffle, industry mergers and acquisitions wave began to accelerate from mid-year, with the BDO Runda NVC shares, mergers and acquisitions wave gradually into the climax stage. Yesterday, BDO Runda (002005) announced that through its wholly owned subsidiary, intends to BDO Runda International (Hong Kong) Limited to a total of about 1.343 billion yuan to obtain an aggregate of 20.05% NVC shares.

The past two years, LED industry overcapacity, the plight of the blind operation and vicious delays not only improve, but intensified, while in 2011, Shenzhen Junduoli, vision optical, Zhongshan Capone have closed down, 2012 Haobo optoelectronics, Great vision optoelectronics and other LED companies are frequent crises, leaving the LED industry downturn worse, mergers and acquisitions, integration and other phenomena is not uncommon. With BDO Runda and NVC combination of the industry that will accelerate the pace of the industry's merger integration.

Kingsun recently announced that it will issue a total size of 800 million yuan of bonds, of which the first phase of the fund-raising 400 million yuan. Kingsun secretaries Weili to the Express reporter revealed that the money will be used to improve the layout, timely mergers and acquisitions and expansion of EMC (Energy Management Contract) new formats. "The company is currently in the LED industry chain from the ground on photovoltaic business with complementary nature of the enterprise in identifying suitable acquisition targets, objects, including large enterprises and SMEs."

In addition, the wave Huaguang Optoelectronics Co., Ltd., Shandong Zhengtie Min said in an interview, also said that the wave Huaguang focused primarily on the development of LED industry upstream, midstream are already packaged enterprise merger integration plans.

"LED industry on the firm's cash and technically demanding, with a series of LED to support this year's national policies and the gradual implementation of a number of successful technology but lack sufficient funds to complete the project or business partners will seek to introduce, so there are now a large industry Integration of the phenomenon. "Wei Li believes that the LED industry is highly competitive and not competitive just can not live, it is expected that the industry will be strong alliance between enterprises merger integration trend.


 Fourth, the "price war" continues to deepen, or move to the "value war"?

2012, on the number of LED enterprises, fierce price war and full of tension tender competition in the market seems to be the main form, and really relates to whether the positive development of an industry product quality, brand, and so can be said that many of the industry Enterprise "ignore" the.

If we say that this one has a lot of frustration, there are many factors that objective necessity, then in 2013, for the LED industry will mean what, hustle surging price war is to continue to deepen, there are still likely to turn more attention to quality and brand "value war"? turn in the brand, technology and quality to make strenuous efforts?

It can be predicted, "reduce competition on price situation and strive to enhance corporate profits", or the market will remain "robust" development under the premise of the main theme. Competition in the market for 2013, the homogenization of serious price war backdrop will continue, and the market competition is not just a simple competition between enterprises, industry competition in the ecological chain also prominent.

In the chip industry, it can be foreseen that the future 2013 mainland China LED chip manufacturers will continue to release capacity and homogeneous environment, hard work, coupled with the mainland will soon be announced limited opening of Taiwan's LED lighting standards certification, will initially mainland-based applications can be immediately used, arms open, will make the future is bound to become more intense market competition, price war continues to deepen.

While the application of enterprises, in 2013, the price decline will also continue to be the main theme, "according to the Buddha, Huaqiang so already in action, I have seen on the market six yuan less 3W bulb", an LED business Marketers thus reflect changes in market prices, at this time we should see who can put the best combination of quality and price.

"Price war with high-end relationship is not very big. Cost control and differentiation is always right. Creating value never correct, but the value pricing is not controlled by you when your main product is no longer competitive, but still as a business main profit point, it would be tantamount to life wide open, a little price war, will let you in crisis, "a true LED lighting business managers expressed their own views, he also pointed to the enterprise said the most important thing at this time to make products, product quality and the corresponding technical differences but still the core level, while the product life cycle to keep up the rhythm, because the market is changing rapidly, accelerate the pace of product cycle the.

2013, destined to be "surging" year, Ebb Tide, while at the same time whether the survival of the fittest and stimulate the market will also become mature upward momentum? "2013 must be the year of precision marketing, LED manufacturers face will be more than 2012 more severe competition, at this time, we are concerned about national support policies, but also should stick to their strategic direction, step by step, "an entrepreneur said so, enterprises must be invincible, will have to be more down to earth High quality and technology products to the market, we must have a unique, high-tech products system, a three-dimensional product strategy, only those truly recognized by the market, in order to truly realize its rapid development.

Meanwhile, in 2013, there will be more enterprises begin to pay attention to a brand, not only by taking the amount of low-cost advantages of scale, brand and more will become the "scale back a rising power."

Fifth, the "business ideas and profit model" How transformation, vendors bundle possible?

"Dramatic changes in the market, it was seen, it was realized, it was still in a dream, always thought that after this crop, good times will come again." And ultimately, whether good days will come, when the arrival of , want 2013 to win the brutal competition in the market, the most important one than the business ideas and profit model innovation.

This is the most varied and thus the most exciting one side. Because this is not just for a business, but also for the entire industry, the business ideas and profit models are undoubtedly a top priority.

Expand all kinds of thinking so. For example, the view that: "do specialize Seiichi two products" is the factory correct idea, but the terminal operators want is a comprehensive range of full range of products; Then, in the LED between manufacturers and terminal operators, the need for there is an integrated platform that can each outstanding manufacturers of fine and timely delivery of products specifically to the terminal? going to be who is going to do this platform? big brand electric provider, or channel chain brand? there is no possibility of Dealers grand coalition?

"There is no possible channel alliance? Producers BaoTuan it possible?" An LED entrepreneurs have made such a very constructive view, and even the traditional lighting companies and LED emerging enterprise resource sharing, there is no channel integration or acquisition possible? agents and production companies have cross-shareholdings may? LED products personalized custom production there may be? production enterprise marketing outsourcing is not possible, obviously, these are the "future time" will be based on the development of the whole industry more mature, higher degree of integration, based on mutual benefit and common development of various forms of cooperation on the basis of, or have a "likely."

An entrepreneur for the "maker of cross-shareholdings," this view expressed identity, "I believe that, in the present circumstances the LED industry, manufacturers and merchants should be between the depth bundled up new sales company, after all, still reflects the manufacturer's ability to In manufacturing, the sale is the business's strengths so that you can allow manufacturers and distributors carry out their duties, intently to their best advantage to the fullest. "

You can see that the current, many dealers do large-scale investment in factories, but the results are often unsatisfactory, and some manufacturers also do marketing multi-sensory "not touch the door," if the manufacturers and merchants tied down after all, a depth between way out. It was also said that vendors bundle (manufacturers folded) This model is also more in the appliance industry, the lighting industry is still small, you can try more and more to explore. The premise is that the business model seems to be based on the depth of understanding of the manufacturers and affirmation.

"Anything is possible, the dealer owns shares of part of the cooperation between manufacturers, will soon become a reality", an entrepreneur has to go on the road and made its own answer.

2013, perhaps there will be more change and walk in LED entrepreneurs to explore the road.

And no matter how the future development of industry changes, 2013 is a cold, is warm, is disease is slow, will be sent to people's hopes and imagination for the future, in 2013, will also have a social responsibility and faithful witness of the LED entrepreneurs and professionalism makers are pragmatic forward footprint.

Meanwhile, we also wish, as China's Lenovo, TCL and Hisense like, like Gree, 2013, there will be worth remembering LED industry, the brand has long hung on it.

Six, industrial enterprises how to break into the low-profit era?

"Early to enter this industry very few companies, in 1994, when the country did not a few, Shenzhen is only two or three" Panggui Wei said. "At that time, because the key technology research and development difficulties, able to produce almost every LED enterprises with R & D capabilities, in particular control technology only rests in the hands of a small number of enterprises."

In the 1990s, LED on as a "scarce commodity" exists only in banks, railway stations and a few other places, and because of the lower prices of raw materials, key technologies research and development difficulties raise the end price, leading to market LED industry has become "dignitaries."

However, competition between enterprises of the LED market civilians. According to reports, since 1997, began to appear on the market with a single-color control card technology transfer of key technologies such phenomena, to 2001 on the development of even the color control cards are sold on the open market stage.

By 2006, the control card technology gradually after mass market, LED industry key technology research and development costs have been most thoroughly reduce the number of Chinese LED enterprises began to grow exponentially. 2008 Beijing Olympic Games and a series of large-scale activities, also gave birth to the rapid development of LED business, and in 2009 reached a peak state.

"From 2007 to 2008, LED display, higher prices, higher profit margins, the business is also a great gap between product prices, as consumers degree of emphasis on product quality continues to improve, LED industry has become increasingly competitive intense, some small and medium enterprises by price, size and other efforts to increase the impact, which are some of the most fundamental reason for the closure of small and medium enterprises, "Panggui Wei said.

Shenzhen Semiconductor Lighting Industry Development Association honorary president Wang Dian-fu said that in the JDL, Bo Lunte, Vision Electronic these small scale enterprises went bankrupt in the context of the fallen unknown small companies are not unusual. LED display industry reshuffle ripe, once the business of operating on major mistakes, it will be quickly swallowed.

Panggui Wei that, LED industry, the lack of core technology, lack of innovative capacity, market disorderly competition, shackles with LED display industry. LED industry prices have been in "profit" era, you must be a breakthrough in product innovation.
 Seven, the product has to cover all applications equipment, personnel how to solve the bottleneck?

As the LED energy-saving, environmental protection, long life and the use of flexible features, LED products and instructions from the expansion of the initial signal to the display, landscape lighting, backlighting and general lighting applications, widely used in indoor and outdoor large screen display, urban architectural landscape lighting, mobile phones, laptops, TV's backlight and automotive lighting and solar LED lighting, road lighting, tunnels, industrial lighting and some special lighting and other applications are constantly expanding penetration.

After a decade of development, China's LED product applications have covered all of these application areas, and continue to develop more new uses. Past two years, artificial light in agricultural production, medical and other fields of application of the light source R & D investment is also increasing, as more and more countries have announced plans to phase out incandescent implementation, with the LED performance continues to improve and prices continued to decrease, energy saving LED is gradually entering the field of general lighting, gas stations, underground car parks, hospitals, hotels, hall, merchandise display cabinets, office buildings and other commercial establishments have pioneered the use of white LED as general illumination.

Meanwhile, the core technology of the lack of checks on the development of enterprises. LED core technology is mainly controlled epitaxy, chip design and manufacturing processes, these core technologies are monopolized by a few companies abroad and be in the form of long-term patent protection, resulting in the technological development of our country in a very passive situation, exports were constrained technological upgrading of enterprises and product updates is limited, the majority of the company's products in the long-term low level of homogeneity, creating a vicious competition.

Firm size remains small. Domestic LED enterprises are characterized by: the number of enterprises, small scale, whether it is before the process of epitaxy, chip, or after the process of packaging and application products, are the form of this structure, even the largest of several LED business, and overseas, compared with foreign counterparts, and its size or smaller. The end of 2011, the domestic upstream and midstream LED enterprises have not a main business income of more than $ 1 billion will lack this form of business R & D strength, low grade of products, lack of competitiveness in the market, the development of China's LED industry is very unfavorable.

Key raw materials, equipment can not be self-sufficient. China's LED industry chain in the main equipment, instruments, currently mostly imported. Key raw materials, component parts, such as phosphor, sapphire, organic sources, arsine, phosphine, etc. to rely on imports, MOCVD epitaxial equipment and part of the fully automated chip and packaging equipment is also dependent on imports, and the price is high. Package with high-performance silicone, epoxy, also have to rely on imports. Long-term effect, making the product cost is too high, not competitive, will restrict the development of LED industry as a whole.

Core technology talent shortage. LED mastered the core technology of the domestic leader in talent shortage, LED industry chain grasp the key technical talent is not enough, it will restrict the technological upgrading of China's LED industry is difficult to fight with foreign counterparts.

Eight, China LED highbay lights industry road of brand strategy how to go?

China's lighting industry a long period of dominance of the international brand competition situation, Philips, Osram, GE and other international giants rely on high-end international brand covers almost all lighting category line, and along the country can compete with only NVC (commercial lighting category brand, focusing on the advantages of engineering and commercial lighting market power), Op (home lighting category brand, focusing on the advantages of terminal outlets and word of mouth), the ground on photovoltaic (led outdoor lighting category brand, focusing on the advantages of LED lights and LED outdoor product) as the representative of category brand. At present, the domestic real serious lack of industry brands, and category integration, public branding will become the category leader in the industry to build the necessary road brand, category brand breaking still confused.

Industry brand is known in the industry and recognized brands, while Volkswagen brand is known to the public and recognized brand. With the Volkswagen brand on the perspective, then, China's home appliances, IT, FMCG, automotive and other industries, as the development of early and full competition, has established a number of well known and widely trusted and popular brands, such as computers Lenovo, home appliances Haier , air-conditioning, Gree, IT communication with Huawei.

Low social concern of the lighting industry, product homogeneity serious, the industry there has long been a large number of non-brand awareness, unbranded products, non-brand business, industry brand competition in the extensive, homogeneity, low efficiency stage lighting company brand building is not up, unable to form a brand, you can not enjoy the premium brand, the cycle can only be collective into a price war, it is clear from the industry, the brand needed industry insiders know the majority of ordinary consumers recognized brand Volkswagen brand transition, which is a common problem facing the lighting industry .

At present, China is in the lighting industry brand to the public by the industry, the brand brand switching stage. With the continuous development of the lighting industry, lighting the importance of corporate brand in the industry has formed a consensus, lighting companies also recognize that competition in the lighting industry, by product competition, price competition to brand competition development. But for how brands from the industry transformation to the Volkswagen brand, the industry is very confused, many companies believe that celebrity endorsements, CCTV advertising, importing CIS, is to do the brand, the lighting industry is still breaking the Volkswagen brand confusion.

Nine, worrying disorderly phenomena product quality problems how to solve?

China LED industry is currently in a mass suicide on stage. If you want healthy development, we must insist on good quality, reasonable profit, adherence to their own market position. Only in this way, the industry can relieve pain, enterprises can stop the bleeding, otherwise doomed doomed.

China LED industry today is like 2004, 2005 energy-saving lamp industry is indeed disorderly phenomena, neglected phenomena.

Chaos is chaos in terms of quality. LED industry, the quality of today's confusion, called unprecedented. Looks almost the same, it actually a big difference. Consumers did not identify the seat of your pants and eyes, so frequently fooled. But ask yourself, you have no obligation consumers do? Freeloaders is your biggest secular newspaper!

Chaos is chaos in the price. The price of the entire industry has been battered chaos, many companies could hold, was forced to follow suit. Similarly a product, brand and nameless small factories spread between 10-20 times, which allow consumers puzzled, brand manufacturers painful. Although low-cost small plants can linger, but worthy of their pay you? - What can not make money doing it, but had to bargain killing so bloody!

Chaos is chaos in the standard. Province provincial standards, standards for cities in various regions are often fights between the standards, so that consumers can not judge, at a loss. Experts quarrel, quarrel Association, domestic and foreign quarrel, the standard of competition have noises, it is truly exciting, it makes very helpless.

Chaos is chaos spread. Everyone says their product is the best quality, the price is optimal. But actually what would happen, even the bouncers do not believe what he says is true. Tuomohengfei, like bullets flying, the consumer is at gunpoint bird!

Ten, 95% of traditional lighting companies transition to the LED?

"The next three years, there will be a lot of LED business can not go on." Wu Yulin said.

LED has been regarded as the emerging strategic industries, but this young industry grow so heavy that many people did not expect. Many companies believe that, LED lighting is not yet universal, the entire market has been flooded with a variety of low-priced, low-quality products, industry reshuffle and remodeling will be inevitable.

In early 2010, the industry relevant industry bodies for LED lighting to replace traditional lighting schedule forecasting activities conducted a survey, the survey results show that people in the industry to replace traditional lighting LED progress more optimistic. Most people believe that within three years, LED lighting to replace traditional lighting ratio up to 20%, while the 3-5 year period of up to 50%, while after 10 years, or up to 80%. According to JP Morgan and the latest forecast, 2014 semiconductor lighting source will occupy 50% of global market share in 2016 semiconductor lighting will occupy 50% market share.

For the rapid development of domestic LED interior lighting market. The survey results also show that most people in the industry believe that in 2020 the share of LED indoor lighting products, or up to 50%. For this reason, some experts predict that the next 10 years LED lighting market will gradually become mature, but also the traditional lighting LED lighting transformation to the most critical success 10 years.

Face of national local government "drastic" to promote the popularity of LED lighting, and LED light "praised", consumers faced with new things, dare to accept the situation. Traditional lighting companies "contradiction" to move forward, both want to seize the "opportunity", also need to rely on traditional lighting business as support. Traditional lighting companies NVC difficult transition is an example of high-level experience unrest, strikes the bottom, channel switching, and now still in the run-in period, although the three executives unanimously united force in the development of LED lighting, but the road is long Come , the need to search up and down. Therefore, the traditional lighting companies how to balance traditional lighting and LED lighting of the "defensive and offensive" of the road, how to better seize market opportunities, play channel edge, looking for successful transformation of the LED is still the traditional lighting companies need to ponder one of the issues.


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