Traditional operating cost load increases cabinet companies to explore emerging channels

Throughout the development situation in 2014, the cabinet industry is generally in a deepening adjustment period: the enterprise transformation is obviously accelerated, the new product development cycle is accelerated, the bad enterprises are eliminated, and the old companies are facing innovation and innovation. Under this circumstance, how to do a good job of the Internet marketing of the enterprise itself in the environment of rapid development of e-commerce and mobile Internet has become the key to success.

More and more costs are required to open a store

Love and hate are intertwined. This is a vivid portrayal of the channel attitudes of cabinet manufacturers and distribution companies. With the continuous increase in store rents and new store operating costs that open up traditional channels, the urban expansion trend of cabinet companies is facing the real challenge of high cost. “The investment in opening a new store is getting higher and higher. When I first opened a store in a first-tier city, the investment at that time was only tens of thousands of dollars. But now it takes at least several hundred thousand to open a standard store investment in first- and second-tier cities. It takes tens of thousands to open a store in the third- and fourth-tier markets!" The owner of the cabinet company issued such a sigh, and the investment in the cost of opening a store is increasing. This has become a huge challenge that enterprises have to face.

Traditional channel operating costs have risen sharply

“It’s not just the increase in the cost of opening a store. In fact, the operating costs of the original traditional channels have also risen sharply.” A person in charge of the marketing department of a cabinet company said that on the one hand, the rent of the store is rising; on the other hand, the store is affected by inflation. The wages and commissions of employees have also been greatly increased; coupled with the increase in logistics and transportation costs, the channel cost exchange year has increased substantially.

At present, China has begun to enter the era of high wages. Almost all cabinet companies have significantly increased the labor wages of their channel operations, which has led to an increase in channel operating costs. "The market competition is very fierce now. For the terminal, excellent clerk is a scarce core resource. In order to keep people, high wages and high commissions are also things that companies have to do." Industry insiders believe that high-wage era, corporate channel operations The hard cost of manpower will only continue to rise.

Logistics costs may increase to historical highs

In addition, logistics costs have reached record highs. As the country's rising prices, the survival cost of cabinet companies has also risen, such as the logistics pressure of cabinets. In fact, due to the current imbalance between supply and demand, rising fuel prices, rising labor costs and rising rents, logistics costs are likely to grow to record highs.

Therefore, under the influence of various factors, the channel cost has risen steadily, which has caused tremendous pressure on cabinet companies. “The channel is king”, and the channel is strong. In the era of high-cost channels, the continued choice to expand traditional sales channels will obviously bring heavy burdens and risks to enterprises, while the new e-commerce channels have obvious advantages. Cabinet companies have to fully exploit the development potential from the emerging channel of e-commerce.

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