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The burden of traditional operating costs increases, cabinet companies explore emerging channels

by:Hench Hardware     2021-09-08
Looking at the development situation in 2014, the cabinet industry as a whole is in a period of deepening adjustment: corporate transformation has accelerated significantly, new product development cycles have accelerated, bad companies have been eliminated, and established companies are facing reform and innovation. In this situation, how to do a good job in the Internet marketing of the enterprise itself under the environment of rapid development of e-commerce and mobile Internet has become the key to victory.

  The cost of opening a store is increasing

   Love and hate are intertwined. This is a vivid portrayal of the current attitude of cabinet manufacturers and distributors towards channels. With the continuous sharp increase in store rents and new store operating costs that explore traditional channels, the trend of urban expansion of cabinet companies is facing the real challenge of high costs. 'The investment in opening new stores is getting higher and higher. When opening stores in first-tier cities, the investment was only tens of thousands of dollars at the time, but now it takes at least a few hundred thousand dollars to open a standard store in first- and second-tier cities. It takes tens of thousands to open a store in the third and fourth tier markets!' Some cabinet business owners expressed such a sigh that the investment in store opening costs is increasing, which has become a huge challenge that companies have to face.

  Traditional channel operating costs have risen sharply

   'It is not just the increase in the cost of opening a store, in fact, the operating costs of the original traditional channels are also rising 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, it is affected by inflation. , The salaries and commissions of store employees have also been greatly increased; coupled with the increase in logistics and transportation costs, channel costs have increased significantly in the past year.

   At present, China has begun to enter the era of high wages. Almost all cabinet companies have greatly increased their labor salaries for channel operations, which has also led to an increase in channel operating costs. 'The market competition is fierce now. As far as the terminal is concerned, excellent clerk is a scarce core resource. In order to retain people, high wages and high commissions are also things that companies have to do.' Industry insiders believe that in the era of high wages, enterprise channel operations The hard cost of manpower will only continue to rise.

  Logistics costs may increase to record highs

   In addition, logistics costs hit a record high. Under the background of rising national prices, the cost of living of cabinet companies has also risen, such as the logistics pressure of cabinets. In fact, due to the combined effects of the current imbalance between supply and demand, rising fuel prices, rising labor costs and rising rents, logistics costs are likely to increase to historical highs.

   Therefore, under the influence of various factors, channel costs have been rising steadily, which has caused tremendous pressure on cabinet companies. 'The channel is kingIn the era of high-cost channels, continuing to choose to expand traditional sales channels will obviously bring heavy burdens and risks to enterprises, while new e-commerce channels have obvious advantages. Cabinet companies have to fully tap the development potential from this emerging channel of e-commerce.
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