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Insufficient innovation of cabinet products, demand cannot keep up with the pace of capacity expansion

by:Hench Hardware     2021-08-30
As we all know, overcapacity has become a very prominent contradiction in the process of my country's economic development. In the past few years, investment has continued to grow excessively, and real estate investment has clearly overheated. In fact, in the cabinet industry, because the scale of the industry and the number of enterprises are expanding at a much faster rate than market consumer demand, the cabinet industry has also experienced a certain degree of overcapacity.

   Overcapacity in the cabinet industry

   Overcapacity means that the total production capacity is greater than the total consumption capacity, which is a normal phenomenon in the development of the industry under the conditions of a market economy. Moderate overcapacity is also of positive significance for industrial transformation and upgrading. However, excessive overcapacity will cause a large accumulation of goods, which will affect consumption expectations and economic growth. As far as the cabinet industry is concerned, when the rigid demand for the property market has not been fully released, overcapacity is also a realistic problem that cannot be avoided.

   In the past 30 years, my country’s urban agglomerations have become more and more larger and larger, and the successive construction industry is also booming. Riding on the ride of the real estate development, the cabinet industry in my country has been in the past two decades. Great progress has also been made in the course of its development. Many foreign brands have also discovered the huge market in China and have entered to compete for the market. The overcapacity in the cabinet industry is more obvious.

   Overcapacity needs innovation to solve

   'Our industry has moved from a quantitative expansion to a transformation stage of qualitative improvement, which has new requirements for the company's brand positioning and business strategy.' A cabinet industry insider believes: 'Overcapacity is like a Sieve, keep the good beans, and sift out the deflated ones. This is the market.'

   When asked how to deal with the common problems of this industry, the industry insiders replied: 'In my opinion, there are many reasons for the overcapacity of an industry. As far as cabinet companies are concerned, the lack of product innovation and brand building Is the key.

  Technological innovation is the 'soft underbelly' of most Chinese companies, and it is closely related to the core interests of companies. Nowadays, there are not many domestic cabinet companies that have the conditions to do independent research and development, so innovative products are invaluable in the homogeneous market. Innovation is the foundation of differentiation. Differentiation not only enables enterprises to have market competitiveness, but also stimulates new market demand, which is a brand's victory weapon. The brand building makes the cabinet enterprises have cohesion and spreading power, which becomes the driving force and boost for development.
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