"House Economy" Helps Small Home Appliances "C-Debut" Cost Rising Will the Net Red's Physique Last?
Text / Yangcheng Evening News reporter Wang Danyang
Under the "home economy", small household appliances attacked and sales were booming.
In early March, data released by the General Administration of Customs showed that in the first two months, China exported 1.85 trillion yuan in mechanical and electrical products, an increase of 54.1% year-on-year, and accounting for 60.3% of the total export value.
Among them, coffee machines, electric hair clippers and other small home appliances are widely favored. The export of home appliances has maintained a double-digit growth since June last year.
A reporter from the Yangcheng Evening News noted that under the "home economy", China's home appliance industry will recover steadily in 2020, with exports exceeding the US$80 billion mark.
Among them, small household appliances performed well.
The industrial and commercial registration shows that my country will add 190,000 small household appliances related enterprises in 2020.
But on the other hand, under the opportunity, small household appliances are also facing the challenges of rising costs, "overdrafts" of online demand and how to obtain the "hearts" of young consumers.
Air fryer, grill, and electric mop are all popular with small appliances to gain eyeballs
In Shunde, Guangdong, Galanz Group Vice Chairman Liang Huiqiang introduced that in the first quarter of this year, Galanz's foreign trade orders increased steadily. The first quarter is expected to increase by 90% year-on-year and 60% year-on-year.
A reporter from the Yangcheng Evening News noted that under the "home economy", home appliances that can meet people's home life and work needs during the epidemic have remained hot since last year. The advantages of the entire industry chain have brought more overseas orders to China's home appliance manufacturing industry.
Information on the official website of the China Household Electrical Appliances Association shows that China's household electrical appliance industry will recover steadily in 2020, with exports exceeding the 80 billion U.S. dollar mark, out of a beautiful V-shaped reversal.
Among them, the output of vacuum cleaners, electric baking, microwave ovens and other products that account for a relatively high proportion of export orders for small home appliances has also increased significantly.
The "home economy" under the epidemic has caused continuous demand for small home appliances and will earn enough attention in 2020.
According to data from the China Household Electrical Appliances Association, in the first half of 2020, cooking appliances such as air fryer and grilling machines, cleaning appliances such as vacuum cleaners, electric mops, etc., personal care appliances such as hairdressers, personal massagers, etc. Sales of equipment, etc., driven by the "home economy" rose sharply. Although there was a decline in the second half of the year, the annual growth rate remained at double digits.
Among them, under the "home economy", people stay at home longer, driving the growth of dishwashers against the trend, and the annual sales increase by more than 25%.
According to statistics from iiMedia.com, during the epidemic, living at home significantly increased the frequency of use of home appliances, and overseas demand for small home appliances increased significantly.
In the first half of 2020 alone, my country's exports of electric frying pans, bread machines, juicers, etc. increased by 62.9%, 34.7%, and 12.1% respectively.
Statistics from the Home Appliances Association in the first three quarters of 2020 show that the cumulative export growth rate of most categories of small home appliances has turned positive from July 2020, and continued to grow in August and September, and the scale continues to hit the best level in history.
Among them, the growth rate of electric appliances continues to lead in all categories. As of September, the cumulative export value has increased by 61.8%, and the month's increase has reached 100%.
Hitchhiking on live broadcast and free-riding online channels are developing rapidly
The arrival of the epidemic also made the online channels of small home appliances develop rapidly in the last year, catching up with the fast-growing live broadcast of goods.
According to statistics from Aoweiyun.com, in 2020, the retail sales of 11 categories of small household appliances will account for 82.8% of the online retail volume, and online has become a well-deserved main channel for small household appliances.
Zhongyuan Securities Research Report believes that the online terminal market for small home appliances is significantly better than offline, and the differentiation is obvious.
In the online market, the year-on-year growth rate of sales and sales of major small household appliances in January this year has risen substantially, while the sales of small household appliances in the offline market have been dismal.
Vacuum cleaners are the only small household appliances that have a positive year-on-year sales growth in both online and offline markets.
Judging from the performance bulletins and forecasts issued by small home appliance companies in the A-share market, the net profit growth of small home appliance companies in 2020 will be outstanding.
The performance bulletin released by Xinbao in March showed that 2020 revenue was 13.18 billion yuan, a year-on-year increase of 44.44%, and net profit attributable to the mother was 1.116 billion yuan, a year-on-year increase of 62.39%; Roborock, which is mainly engaged in sweeping robots, released a performance bulletin in February. , 2020 revenue is 4.53 billion yuan, a year-on-year increase of 7.74%; net profit is 1.371 billion yuan, a year-on-year increase of 75.19%; Xiaoxiong Electric disclosed its 2020 performance forecast in January, and it is expected that the net profit attributable to the parent in 2020 will be 402 million-456 million Yuan, a year-on-year increase of 50%-70%.
Workers who live alone prefer "small" to help small home appliances "C-bit debut"
Why do small appliances become Internet celebrities?
The analysis believes that under the general environment of normalized epidemic prevention and control, the characteristics of small size, no installation, relatively low unit price, and online sales make small home appliances have their own "net celebrity" physique.
The rise of young consumer groups born in the 1990s and 95s, and the increasing number of young people living alone each year, have also become a force to help small home appliances "C-debut".
"Small home appliances with high appearance and small volume are still the mainstream trend in the context of the increasing number of single people living alone." When talking about the trend of the small home appliance industry in 2021, Li Ting, head of the small home appliance division of Ovi Cloud Network The analysis believes that most consumers living in first- and second-tier cities, whether renting a house or buying a house on their own, most consumers have a smaller housing area, while small household appliances occupy a small area and are smarter, making them the best workers. selected.
At the same time, as the number of singles in domestic cities continues to expand, young people living alone are more inclined to buy small home appliances to avoid tastelessness.
For example, last year, some young small home appliance brands with Internet characteristics introduced high-value and trendy products such as "food for one person", and used social marketing methods to capture the young fashion crowd.
These emerging small home appliance brands have a certain degree of influence on top brands.
As the leader of the small home appliance industry, Fang Hongbo, chairman and president Fang Hongbo, also said at this year's Midea annual meeting that it should reflect on why Midea did not seize the market segment opportunities of emerging small home appliances in time.
At the same time, in order to become more flexible on the new track of creative small home appliances, Midea has established a team to develop pet appliances, maternal and child appliances and other market segments to integrate more Internet thinking and user thinking, and accelerate the innovation and iteration of small home appliances. pace of.
Galanz, who is also in Shunde, launched the "Debut! Little Electric Star Group" on platforms that are loved by young people born in 1995, such as Station B, Xiaohongshu, and Zhihu after the Spring Festival this year, pushing the all-in-one breakfast machine, Internet celebrity electric cooker, and complementary food. Emerging creative small household appliances such as machines, milk warmers and so on.
Rising prices of raw materials attack small home appliances and experience rising costs
However, the sustainability of the popularity of small home appliances is facing challenges.
"Due to rising raw material prices leading to higher product costs, we will be forced to increase prices." Li Ting, head of the small home appliance division of Ovi Cloud Network, said that this is what small home appliance companies say most often this year.
The reason is that from the second half of last year to the first half of this year, due to the imbalance between supply and demand, all kinds of raw materials, such as polyolefin, glass fiber, copper foil, etc., have risen to varying degrees, which is a shock to home appliance companies, especially For many listed companies in the middle and lower reaches of the industry, profits will be affected to a certain extent.
The cost of raw materials accounts for about 80% of the total cost of home appliance companies.
For example, according to the 2019 annual report, the direct materials of Xinbao shares, which are mainly small appliances, accounted for 76.17% of operating costs.
The Zhongyuan Securities Research Report believes that from the beginning of 2021 to the end of the month, the continued strength of the non-ferrous and chemical sectors has led to a rise in the prices of raw materials required for the manufacture of small home appliances related parts. Among them, the prices of heat-resistant plastics PP and ABS materials that are widely used in industry production The index quickly rebounded after experiencing a brief turbulence in mid-January.
Compared with the situation where the average price of major home appliances has increased significantly due to the strong cyclical sector, the average price increase of small home appliances is slightly lagging due to fluctuations in raw material prices, or taking into account factors such as production costs, consumables, and inventory surplus, the market The average price is less showing an overall rise or fall, but the rise of different categories of small home appliances is different.
Regarding the overall market for small household appliances this year, Li Ting predicts that from the perspective of the overall scale of small household appliances, the development of traditional categories is close to touching the ceiling, and the future growth depends on the promotion of emerging categories.
Consumers still have a large demand for small home appliances. From the perspective of channels, online e-commerce will make rapid progress in 2020. In 2021, the demand for traditional categories will be relatively overdrawn to a certain extent.
Offline development has encountered bottlenecks, and the development of new sales channels and sales models is urgently needed.
It remains to be seen how long the popularity of small appliances can last.