Prices Or Concessions? Appliance Companies Face A Dilemma - Household Electrical Appliance

"White" appliances at the end of a price adjustment after the beginning of this year

, is currently experiencing a price increase or price reduction is a difficult choice. Recently, provincial price monitoring department, where some businesses learned from Hangzhou, washing machines, refrigerators and other "white" appliances through a price increase, the current began to offer price promotions. Appliance shopping centers in Hangzhou, a manager said that currently almost all "white," engaged in discount appliance brands. Suning Appliance, Zhejiang's Department also confirmed that since late last year to raise prices early this year, the current widespread white goods sales. Monitoring found that the current 50 yuan to 500 yuan between the preferential rate, generally it is some time ago, "white" appliances has risen more sharply.

Costs push prices From a cost point of view of, household electrical appliance enterprises in October last year, the purchase price of raw materials compared with the same period in 2003, up 70% of steel, plastic, rose 73.9%, copper has gone up by 1,600 yuan per ton. Moreover, with years of international crude oil, iron ore prices Going up, board, plastic, copper and other prices to rise is a foregone conclusion.

According to insiders, to steel, plastic raw material costs represented a key account for at least one third the cost of white goods machine. In their view, because raw material prices, air conditioning machine production costs rise at least 20%, washing machines, refrigerators, machine production costs rise at least 10%. Upstream raw materials continued to rise, home appliance industry has hit bottom-line profits. Stands to reason that the prices of household appliances enterprises is a matter of course. ,

Prices caused by excess production capacity is difficult

Cost price in the promotion of home appliances, manufacturers have the desire to price increases, and the current prices for household appliances only to rise further? Industry experts believe that this is the home appliance industry in general oversupply, competition among enterprises reaction.

As the access threshold for household appliances industry, not high, resulting in the appliance industry, a lot of excess capacity. According to statistics, from January to October last year, household washing machine cumulative production reached 17,988,700 units, up 24.39%; household refrigerators produced 25,564,800 units, up 35.76 percent; household air-conditioner production of 59,743,800 units, up 44.43% . Small household electrical appliances continued good growth. January-October production was 3.838 million electric water heater units, up 27.62%; microwave output was 34.8934 million units, up 20.23 percent; household electric appliances and dishwasher baking production continued substantial growth, an increase of 53.01% and 152.31%.

In recent years, exports are more home appliances, home appliances market demand in rural areas also increased, but because urban residents have a higher rate of appliances (the end of 2003, China's urban households have a washing machine for every 100 residents in the amount of 93.2 units , refrigerator and washing machine to maintain the level of reserves level roughly equal), the city has nearly saturated the market. Change can be said that the current stalemate situation is the dilemma the price of the demand and supply situation by the household appliances decision.

by: gaga

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