Zhitong Financial APP learned that on July 10th, Qijia net (08395) and China Construction Expo (Guangzhou) jointly organized the "offensive and defensive situation, break through the bottleneck-the third Home Decoration Industry Ecology Conference of Qijia Network in 2023" was held in Guangzhou. The conference is supported by media strategies such as Sina Home, Youju Vision, Tencent Home KE Holdings Inc. and so on. At the meeting, authoritative industry experts respectively made keynote speeches on the development trend of the industry and the countermeasures of enterprises, in the round table forum, well-known building materials brands and heads of enterprises in each link of the home decoration industry chain also conducted in-depth discussions on the topic of capacity building and cross-border integration under low growth.

Qijia net also launched the sixth designer competition and announced the launch of supply chain platform strategic cooperation model. Through the event to promote the mining of design talents, to help platform installation enterprises to build competition barriers and enhance service capacity; by opening the supply chain capacity of the platform, to help ecological partners achieve resource linkage and continuously deepen the efficiency of the supply chain.

Change the mind and build the core competence

The industry entering the low growth cycle has also brought many challenges to enterprises, the most prominent performance is the increasingly fierce competition in the industry, and even the emergence of a local price war, in short, it is more and more difficult to earn money, the industry will also face integration and restructuring. Another challenge comes from the changes of users. "post-90s" have become the main consumers of home decoration, and their personalized decoration needs are getting higher and higher. at the same time, users are becoming more and more cautious, and their consumption stratification and grading trend is more obvious. Under the low growth, the previous extensive mode of operation has been unable to adapt to the existing competitive environment, enterprises have to make rapid adjustments if they want to better "survive".

For a long time, the home decoration industry has always been crazy to expand the scale and desperately "pile" the phenomenon of single quantity, but in the view of Gao Tianyi, chief analyst of Zhitong Finance and Economics, under the low growth cycle, profits for the market are no longer effective. "instead, we have to keep profits at this time." do a good job in fine operation, first solve the problem of survival, and ensure that enterprises have enough ability to deal with the challenges of industry fluctuations.

Even in the face of the adjustment of the industry cycle, some enterprises choose to "expand against the trend", and there are some useful paths to explore in cross-regional, cross-category and scale. From a phenomenon point of view, most of these players are head enterprises with strong ability to integrate resources, and their expansion is also different from the blindly pursuing scale in the past, and more is the deep mining of user value. Its development model is not necessarily suitable for all players in the industry to follow.

But for most small and medium-sized equipment enterprises, they should change their thinking, fully realize the difficulties and challenges, return to the business itself, balance profits and scale, lay out the layout according to their own strategic positioning, and do a good job in fine operation. strengthen the building of core competencies. In order to do a good job in refinement, first of all, we should do a good job in organizational construction, improve the operational efficiency of the organization, in order to adapt to the changes of the industry, and then strengthen user management and delivery management to create user reputation. We can also use some efficiency tools to reduce cost and increase efficiency with the help of platform power.

Small and medium-sized enterprises can also be "small and beautiful." according to Xu Chunyang, executive chairman and secretary-general of the China International Home Industry Development Forum and founder of home decoration afternoon tea, they can still survive by relying on word-of-mouth, expertise, services, resources, and so on. but strategic stratification must be done. The strategic layering of the enterprise must be carried out according to the consumption layering of users, and do a good job of user management according to the needs of users, so as to precipitate the ability to replicate the organization and key roles. The sixth designer Competition will be launched at the meeting, which is an industry competition to help decoration enterprises build designer brands.

Qiu Zhenyi, president of Qijia, said that Qijia has been strengthening the research and management of user layering and integrating it into the platform mechanism, resolving users' pain points and building a benign consumption environment by solving conflicting products and services. And through digital tools, operation system upgrading, standardized management and other measures to strengthen the support for installation enterprises, to enhance the platform merchants in the brand, customer acquisition, transformation, construction, after-sales and other aspects of service capacity, to help it build core competitiveness.

The trend of cross-border integration has been strengthened, and channels have become the focus of competition.

In recent years, the phenomenon of cross-border integration in the home decoration industry is becoming more and more common, not only in a variety of modes, but also in the number of players involved. At present, there are three main types of cross-border integration, including the integration of customized enterprises to integrated enterprises, the cross-border of multi-category of parts enterprises and the integration of integrated channels, while the third type is the cross-border retail of equipment enterprises. Although the phenomenon of cross-border integration has always existed, under the low growth, this integration seems to be more intense, and has become one of the ways for many players to fight against low growth.

Behind the cross-border integration is the change of users' needs. The integrated home improvement represented by the whole assembly can bring users a better experience, can greatly save users' time and energy, and is more and more popular by users. From the perspective of the development needs of enterprises, cross-border integration is not only the second curve for enterprises to find business growth, but also the choice to expand their own scale and improve profit margins. Similarly, cross-border integration is also a necessity to improve the efficiency of the industry, which reflects the phenomenon that the overall development of the industry is still relatively extensive, and there is still room for iterative improvement in the development model and operational efficiency.

In the past year or two, most cross-border players have gradually shifted from category to channel cross-border. For example, the custom home industry has shifted from the cross-border between cabinets and wardrobes in the past to the cross-border channels, that is, "integrated customization". Other parts enterprises are also moving closer to the integrated channel across the border. This also shows that the installation channel has become the focus of cross-border competition in the industry and the position that can not be lost.

Fighting for the position, on the one hand, the installation enterprises are closer to the users, especially with the continuous improvement of the scale of the whole assembly, the voice of the installation enterprises from the front-end design to the purchase of materials is getting heavier and heavier, and the users' decisions are more easily influenced by it. on the other hand, the growth rate of the customization and parts enterprises' own channels slows down, while the installation enterprises' channels, as a new channel, not only cover a wide range, but also have a large scale. It can provide a broad expansion space for the development of customization and parts enterprises.

Some experts believe that cross-border integration is not necessarily necessary, because the home decoration industry itself is relatively large, and the industry is also very scattered, for most enterprises, they can live well without cross-border integration, and the key is how to build their own competitiveness. Some experts believe that cross-border integration is bound to break the original cooperative relationship, everyone from competition and cooperation to competition, whether the distribution of interests and competition between each other will be more fierce, the industry may enter into a disorderly competitive environment.

Many people think that the trend of cross-border integration will become stronger and stronger, and the depth and breadth of industry integration will also be enhanced. Especially in the case of low growth in the industry and high cost of getting customers, the future cross-border integration model will also form two camps: one is that the installation enterprises sitting on the assembly channel will continue to integrate the household building materials into their own system, gradually expanding into the "decoration + retail" model, and the second is the brand retail side, relying on their own brand and store advantages to integrate upward, transform into the whole business and develop into a "brand + decoration" model.

Whether bullish or bearish, the phenomenon of cross-border integration is a useful exploration to deal with the current low growth, but the current way of cross-border may still be relatively superficial, and we should see that there are indeed some chaos in the process of integration. From the point of view of the long-term development of the industry and the protection of the interests of users, it is still necessary to strengthen industry self-discipline and supervision to avoid vicious competition, so that the industry can go further and truly make cross-border integration an effective way to improve the efficiency of the industry.