Hardware Tools New Channels Supermarket Model Analysis

In the past two years, the hardware tool industry has begun to emerge a new form of channel model - supermarket chains. Such a model, the birth of the hardware tool industry, essentially because the competition is too intense, homogenization is very serious, desperation, companies only start from the channel to change, hope to re-shuffle through the channel, quickly drive sales The increase has broken through the embarrassing situation of non-growth of corporate sales. However, for this form and future development, many companies have not made detailed scientific arguments. For future strategic development, more detailed planning is also needed.

China's hardware tool channel model presents a diversified development trend China's hardware tools channel business changes in these years mainly on two points: one is that the stronger dealers in the local or neighboring cities to increase sales of online stores, which is to open a few more stores. Typical are Tianjin Wenguang Group, Beijing Huaqiang, Xin Fangsheng, Shanghai Shifeng, Hua Lin, Hong Kong’s Guohui, etc. The current thinking of these dealers will gradually expand the layout of outlets, but it is difficult to manage. There are a lot of grey areas for procurement, and if you want to have a good network of outlets throughout the country, it is estimated that it will not be feasible in the next few years.

Another new form is the so-called purchasing alliance. This idea was very good. Through the alliance between distributors, a powerful purchasing group can be quickly formed to centralize purchasing, integrate distribution, reduce costs, and expand brand influence. The monopoly or strong position of channels can be packaged and listed even through asset restructuring. However, due to many reasons for its own development, the procurement alliance is not successful. It is still a loose combination of dealers and the actual commercial value is not great.

In addition, there are several types of models, such as Gu’an Jie’s and the e-commerce model of Shanghai’s Western Regions. In addition, a large number of couples are left.

There are many reasons why hardware tool distributors have changed little in the past few years. There are internal reasons such as ideas and financial strength, and there are also reasons for gray procurement. Coupled with the large number of upstream suppliers, there are many reasons for change.

China's hardware tool channel model has been unable to keep up with the pace of development of brand enterprises. The traditional single agent system channel model, under the share of many brand companies, there are not many high-quality channels, the newly entered brand, for their own products, research and development, brand, Companies that do not have enough confidence, such as systematic development, will find it difficult to gain an advantage in the dealership. Even for the old brand, it is hoped that the channel business will have sufficient management, capital, customer development, marketing, customer management, and sales promotion capabilities. . Although there is an unequivocal structural contradiction between the distribution channels and the brand enterprises, due to the success of mainstream brands in previous years, they are not eager to make revolutionary changes to the channels. For latecomers, especially those who wish to achieve rapid growth through marketing, the choice of channels is too difficult.

So the so-called chain stores, supermarkets and other models were born. For the model of chained monopoly or supermarket, there is a golden indicator. If this indicator is not reached, there is no foundation for survival. That is, the profit of a single store has a considerable profit, which can achieve or even exceed the profits of multiple brands of agents. . If we want to demonstrate this problem, we must in-depth investigation and study of the Chinese market terminal procurement habits and characteristics, as well as the characteristics of hardware and tools products.

Hardware tools are generally classified into aerospace, industrial, professional, diy, and four levels. The demand for aerospace class is limited, and the channel model is generally quite special. Industrial grades are generally available in such sectors as subways, wind power, and nuclear power plants. The demand is relatively large. Professional grades are widely used for vehicle maintenance and general factory use. Demand is large, and diy level The demand for tool products in China is small because the Chinese do not like to do it themselves. At present, the vast majority of Chinese hardware tool manufacturing companies or brand-operating companies' products are mostly professional and diy. The characteristics of large demand determine the fiercest competition in this area, and due to the severe homogenization of products, it is difficult to imagine how simple it is to use the brand to operate. Through analysis, we can find that the demand for professional-grade tools is the largest in the market, and the demand for diy will increase in the future. Since a large number of purchases exist in this area, as long as the store's product line is sufficiently abundant, a single brand supermarket chain or monopoly is feasible.

From the perspective of the brand's market awareness, the current tool brand is notoriously good. Under such circumstances, the brand's demand for the market is still very large, which also gives the new brand a certain operating space.

For example, efforts, veins, etc. are all taking this path.

But why did Ai Weiboer such a new brand fail to follow this path? There are not only the reasons for the leader's thinking, but also the reasons why there are many disadvantages or problems in the operation of chain stores and supermarkets.

The advantages of chain monopoly and supermarkets: Channels are flat, and profits of enterprises and franchisees are increased. It is beneficial to the improvement of the brand, management, market feedback, and response capabilities of the company.

Disadvantages of chain monopoly and supermarkets: First of all, their own supply chain management needs to be upgraded to a new level; Secondly, the selection of new dealers is difficult to investigate, and there is a need for full support for the dealers' market development. If you can't go on, the biggest loss will be the company; it will be easy to open and operate, and it will be difficult to operate. In the initial stage of opening, companies need to provide a lot of support for franchisees. For enterprises, the investment is too large. If the franchisee's dealers do not have a wealth of downstream customer resources in the region, it is almost impossible to make profits in the short term.

Therefore, the franchise chain seems to be very beautiful in the early days, and the volume of the company's stores will increase rapidly. However, if you want to continue to make profits in the later period, it is almost impossible for the company to have high overall strength.

Superstars are already listed. Why should we not choose such a model without lacking funds? I think the appetite of the superstar is bigger. Superstars have adopted two strategies for the Chinese market. One is the traditional agency model strategy of the steel shield brand, and the other is the diy boutique model. Through the development of the two models, the company accumulates experience and waits until its own market has sufficient influence. Mature enough, their own supermarket chains must be promoted, or they are all directly-operated supermarket chains, similar to Gome in the home appliance industry.

The future of chain stores and supermarkets is analyzed from the perspective of the difficulty of profitability in storefronts. The profitability of chain supermarkets with multiple brand portfolio models is the strongest, and the chain model of single brands is slightly worse. It is unlikely that a single brand will be infinitely large in the product line unless the company eventually moves toward integrated purchasers.

Therefore, we can find that franchised supermarket chains can exist and can be developed. The key lies in whether the company has superior financial strength, product procurement capabilities, comprehensive R&D capabilities, chain enterprise management capabilities, brand building capabilities, and talent advantages. If it is, this model can develop rapidly. If it is not, it is very likely that the fetus will die. Enterprises should consider it carefully.

For the multi-brand, multi-category chain model, similar to the large-scale industrial products supermarkets of Guzhengjie, if it is localized, it can lead the single-brand supermarket chain in all aspects.