Difficult to do business Home Furnishing companies to compress costs

This year, the storm of regulation in the real estate industry has not stopped since the beginning of the year. As the downstream real estate industry, it is inevitable that it will be affected. Since the third quarter of last year, the sales and profits of the household industry have fallen sharply. . Factors such as rising raw material prices, "labor shortage", interest rate hikes, and power shortages have led to a substantial increase in operating costs, which has caused many home furnishing companies to fall into trouble. In the context of difficult business, in addition to finding ways to "open source", how to "throttle" has also become a question for many home furnishing companies.

Rising costs are now a big problem

Yao Liangsong, chairman of Oupai Home Furnishing Group, said that seasonal losses in the first quarter of 2011 have become a common phenomenon in the home decoration industry. The substantial increase in labor costs has worsened the development of the entire industry. Taking Europa as an example, as of March this year, its labor costs have increased by 40% year-on-year. The rise in prices of raw materials such as plates is also very obvious. Hu Yuanlian, general manager of Yongbotang Redwood Price Furniture, told reporters that in half a year, the price of high-end timber such as rosewood has risen by 30%.

More than one person in the industry told reporters that the plight of the home furnishing industry has been highlighted. In addition to the lack of market prosperity, operating costs have become a big problem now.

Growth against the trend, cost control shows real time

Although faced with the dilemma of property market regulation and rising costs, many home furnishing enterprises have achieved contrarian growth. In the first quarter of this year, the total turnover of Europai increased steadily, up 57% year-on-year; Yongbotang expanded against the trend and now its number of stores has leapt to the top in Guangzhou; Liangjia not only fully renovated and upgraded all the stores in the city, The newly launched hardcover upgrade package has also been initially recognized by consumers. The company also plans to add a branch in Nanhai and Zengcheng this year. The new store in Zengcheng will appear in the shopping mall for the first time.

Although each company's development model is different, in addition to expansion, these few companies also attach great importance to cost control.

Yao Liangsong said that in the less favorable market environment, the reason why the European faction can quickly get out of the predicament and open the "fast track" for healthy development mainly depends on the following key factors: accurate prediction of the situation and forward-looking Sexual judgment, early formulation of response strategies; formulation of the group ’s mid- and long-term development plans and short-term development goals; comprehensive improvement and improvement of the management system and incentive mechanism; multi-party attack and business expansion; For example, while maintaining its position as the pillar industry of European cabinets, Oupai has expanded projects such as wardrobes, kitchen appliances, wooden doors, engineering, foreign trade, and sanitary ware. Due to the similarities in raw materials for cabinets, wardrobes, and wooden doors, such The horizontal expansion of the military has given the European party a greater bargaining power for upstream material suppliers, and it can also save the marketing cost of unit-value products. In addition, Europai has further reduced administrative costs and production costs through system optimization.

Focus on small costs

On June 19, the newly upgraded Liangshi Huangshi Store has a more complete and rich product category. On the opening day, there are various brand-name low-price snap-ups. The floor drain is 9.9 yuan / piece, the 3L rice cooker is 129 yuan, and the glass glue is only 1 yuan. Wait. Huangshidian is a sample. According to Zeng Yuzhou, general manager of Liangjia, in order to maintain the rapid development of Liangjia, it is necessary to continue to insist on the image of Liangjia being cheap and good quality, and it is inevitable to make good articles on cost control.

Last year, the beautiful home stores that have been renovated successively introduced more types of products under the same operating area, which is equivalent to reducing the rental cost of unit products. Scale is obviously also a trick to control the cost of beautiful homes. Take the decoration packages that are very popular nowadays as an example. Due to the well-promoted marketing of beautiful homes, there can be up to dozens of units in a building in a new building at the same time. Workers and project managers can work in accordance with the procedures. Reducing the time between the various construction sites, which naturally effectively reduces the labor cost of each unit, and achieves the purpose of giving real benefits to consumers.

Since the Zengcheng store, which is about to open this year, is located in a shopping mall with higher rents, Zeng Yuzhou admitted that it will have to work harder on cost control in order to adhere to the strategy of cheap and good quality. "In addition to continuing to increase the number of products per unit of operating area, we are studying how to reduce logistics costs. Now we are discussing with many suppliers to move everyone's warehouses together, so that the reduction in logistics costs is guaranteed."

Raw materials account for a large proportion of the cost of mahogany furniture, and Yongbotang can develop against the market. In fact, it has a great relationship with their material cost control. It is said that Yongbotang invested a lot of money early to hoard a large number of precious raw materials such as Laos red rosewood, African rosewood, wenge, African yellow pear, and ebony, which gave the company a chance to win a new round of material price increases. Nowadays, Yongbotang has opened more and more branches. In the eyes of experts, this is also a great way to control costs, because the same marketing costs every month are allocated to more branches, which is equal to the cost of each store. There has been a decline, and under the premise that the prospect of the mahogany furniture market is now unanimously optimistic, this is a good way.