Survive and change in adversity, accelerate the transformation and upgrading of household stores
The year 2022 is coming to an end. Affected by the repeated COVID-19 and the downturn of the real estate market, many household stores have been forced to close down, and the development of the industry is full of challenges. As the epidemic prevention and control entered a new stage, the industry began to feel warm. Now, the market environment is changing, and the consumer demand is also changing. Under the background of increasingly saturated market, the household industry is about to enter a recovery period.
Survive in winter
This year, affected by many, wide and frequent outbreaks of the epidemic, the national building materials and home furnishing stores suffered a major impact, and the industry as a whole was in a recession. In April, IKEA, a global furniture giant, announced that its offline stores in Guiyang were closed, breaking the myth that they had been in China for more than 20 years; In June, Homearch, a selected home furnishing brand under Alibaba, announced that its first store in China would be officially closed from July 15; In July, following Guiyang store, IKEA announced to close Shanghai Yangpu store; In August, Unintegrated Home Jinan Beiyuan Store issued a notice of closing, saying that Unintegrated Home Beiyuan Store decided to officially stop business and withdraw from the Jinan market due to serious losses.
In addition to encountering the tide of store closure, the performance of household stores has also declined to varying degrees. From this year's third quarter report, as the leader of the household industry, Red Star Macalline achieved a revenue of 10.484 billion yuan in the first three quarters of 2022, a decrease of 7.67% compared with the same period in 2021, and the net profit attributable to shareholders of listed companies was 1.318 billion yuan, a year-on-year decrease of 36.17%; In the first three quarters of 2022, the second in the industry, Fantasy Home, achieved a revenue of 9.429 billion yuan, a year-on-year decrease of 3.84%, and the net profit attributable to shareholders of listed companies was 1.535 billion yuan, a year-on-year decrease of 10.27%; In the first three quarters of 2022, FuSenMei, a regional leading store, achieved a revenue of 1.09 billion yuan, a year-on-year decrease of 3.40%, and a net profit attributable to shareholders of listed companies of 606 million yuan, a year-on-year decrease of 12.89%.
In addition, the terminal consumption demand of building materials and home furnishings has already shrunk. In addition to the impact of the epidemic, the closing time of relevant building materials and home furnishings stores is more than two weeks on average, and home decoration, logistics and transportation, after-sales services have also been suspended. The superposition of multiple factors has enabled the national building materials and home furnishings market to open the "winter" market.
According to the data released by the Building Materials Circulation Association, the national building materials and home furnishing boom index BHI in November was 86.52, down 11.6 points month on month and 52.98 points year on year. The sales volume of building materials and home furnishing stores above the national scale in November was 60.87 billion yuan, down 26.22% month on month and 52.58% year on year; From January to November 2022, the cumulative sales volume was 1089.251 billion yuan, up 2.97% year on year. On the whole, building materials and home furnishing stores are under great pressure, and consumer confidence needs to be further boosted.
The policy is good and the recovery is good
However, the good news is that as the epidemic prevention and control enters a new stage, the industry pressure will be fully released.
The reporter of the Business Daily saw offline that the optimization and adjustment of epidemic policies led to the gradual recovery of consumption, and the number of consumers in Beijing's home stores increased significantly. The insiders said that with the introduction of favorable national policies, the household market has gradually warmed up. It is expected that the consumption vitality of the household market will be further released, driven by the traditional consumption peak season of New Year's Day and Spring Festival. The Industry Research Department of the Building Materials Circulation Association also said that although the national building materials and home furnishing market is still at a low level in the short term, since December, various parts of the country have successively issued measures to optimize the control of the epidemic situation, and the market order will gradually recover, and the market may stabilize or be just around the corner.
At the same time, the introduction of industry support policies is also expected to provide development opportunities for the home furnishing industry. In August this year, the Ministry of Industry and Information Technology, the Ministry of Housing and Urban Rural Development, the Ministry of Commerce and the State Administration of Market Supervision jointly released the Action Plan for Promoting the High Quality Development of the Home Furnishing Industry (hereinafter referred to as the Plan), which has made unprecedented efforts to promote the upgrading, reform and development of the home furnishing industry. According to the plan, by 2025, the innovation capacity of the home furnishing industry will be significantly enhanced, and the supply of high-quality products will increase significantly, initially forming a higher level virtuous circle of supply creating demand and demand pulling supply. At the same time, it is clear in the plan that about 50 well-known brands and 10 ecological household brands should be cultivated in the household industry, a batch of excellent products should be promoted, 500 smart home experience centers should be established, 15 high-level characteristic industrial clusters should be cultivated, and high-quality supply should be used to promote the quality consumption of household brands.
As a programmatic document for the top-level design of the household industry, the implementation of the scheme is expected to further boost household consumption, promote the industrial development to speed up again, and move towards a new era of high-quality development of the household industry.
Transformation and upgrading seeking breakthrough
2022 is a difficult year for the home building materials industry. The offline stores are under pressure, and businesses are looking for ways to break the situation. Today's young consumers are more inclined to "plant grass" online first, and then go to offline stores for experiential purchase, which can reduce the cost of time and energy. Therefore, live broadcast business has become a new direction constantly anchored by major household stores.
Take Red Star Macalline as an example. During the "Double 11" this year, Red Star Macalline has made a layout of "double scene live broadcast in the same city" by virtue of the ecological advantages of home decoration and integration of online and offline. More than 1000 home decoration designers and front-line professional craftsmen from the home decoration business of Red Star Macalline directly hit consumers' home decoration pain points with front-line experience and professional knowledge, bringing live broadcasts of characteristic themes such as design lectures, project avoidance, home decoration rights and interests in seconds. It is reported that during the "Double 11" period, the turnover of Red Star Macalline reached 17 billion yuan, and the live delivery business really became a new way to attract customers.
At the same time, the epidemic has also accelerated the pace of home furnishing enterprises to embrace digitalization. This year, Fantasy Home focuses on home furnishing, takes "cave" as the core, invests heavily in relevant research and development, and builds accurate offline stores and merchants through multi-channel traffic such as online private community, live broadcast, and local stations, achieving remarkable results; Fusenmei also vigorously developed new retail this year, cut into the smart home track, opened new retail self run stores such as "caramel box" and smart home experience stores, actively laid out expansion businesses, and brought new revenue growth.
It can be predicted that the pace of transformation and upgrading of household enterprises will continue to accelerate in the future, but fierce competition is still the theme of the industry. Under the background of increasingly saturated market, how to seize the opportunity and seize the first opportunity for household enterprises is still a difficult problem to face in 2023.
