Recently, Jiang Hongyuan, president of the Zhejiang Furniture Association, unveiled the inside story of the industry, saying that the biggest problem in the furniture store is that the operating cost is high, the store rent accounts for more than 30% of the furniture price, and the final payment is the consumer. Furniture store rents are too high At present, many furniture brands are stationed in furniture stores for sale. Jiang Hongyuan believes that in this marketing model, whether the furniture store business is doing well depends on whether the interests of producers, sellers, owners, and hypermarkets can form a community. If one of the parties does not make money, there will be a hammer sale and fraudulent consumer. Jiang Hongyuan clearly pointed out that today, the interests of the four parties in the furniture market have been unbalanced, mainly because the operating costs of furniture stores are high. For example, he said that in Beijing, the annual rent per square meter of furniture stores is more than 6,000 yuan, and the annual rent of furniture stores in Hangzhou is 1,500 yuan to 2,000 yuan per square meter. "This price, the building is enough." Jiang Hongyuan said. Jiang Hongyuan told reporters that in Europe and the United States, the rent of furniture stores accounts for about 10%-20% of the selling price. However, the domestic situation is that the rent accounts for more than 30% of the selling price, and some even exceed the manufacturing cost of the product. The first-line dealer of a furniture brand gave the reporter an account: "In the past, 200 square meters of storefront, the monthly rent was 20,000 yuan, the annual profit can reach 500,000 yuan; now 300 square meters of storefront, one month rent is 40,000 yuan, the annual profit is still 500,000 yuan. Therefore, the investment burden of a large number of furniture dealers is aggravated, the operating costs increase, the average profit declines, and even losses occur." Some insiders told the reporter bluntly: "The whole industry is now In awkward situations: dealers have been busy for a year, profits are lower than in previous years; furniture stores are everywhere, and there are few shops with good operations; furniture manufacturers have increased production capacity, but they are not sold.†To the consumer in Beijing Jimei furniture store, the salesman who manages the mattress, Ms. Pan told reporters that her store has 180 square meters, and the rent is about 340 yuan per square meter per month. Ms. Pan said that the annual rent is about 30% of one year's sales. She said: "The rent is already very high, and it will continue to rise every year, which is a big burden for manufacturers." She said frankly: "The rent has risen, the product will naturally increase in price, and the rent is affecting furniture. An important factor in the price." In recent years, major home chain stores have expanded, and the industry has been full of controversy. Many people think that the store is doing commercial real estate, earning money for capital operation, not for furniture retail. Such a channel model continues to increase the cost of circulation for home-made manufacturing companies, so that the price of furniture products continues to rise, and ultimately everything must be paid for by consumers. As far as the Beijing market is concerned, home stores can be divided into two major blocks: First, in Beijing, the total operating area of ​​each home store is about 2 million square meters, and the annual sales of household products is about 30 billion yuan; the second is the Xianghe distribution center. Its total home business area is about 2 million square meters, and the total annual sales of household products is about 20 billion yuan. The rent standard for home shopping stores in Beijing is 200 yuan - 500 yuan / square meter per month, paying quarterly or semi-annual; Xianghe rent standard is 50 yuan - 200 yuan / square meter per month, payable in one quarter or full year . "In 2007, a product price increase of 30%, dealers have a lot of profit can be earned. But now, a product price increase to 60%, the profit is very low, even less than the 2007 increase of 30% of the profits." Insiders To the reporter. In his view, the home industry has entered the era of high channel costs, dealers not only face operational problems, but also face the increase in store operating costs. According to the reporter, most of the domestic household product distribution channels have experienced four stages: manufacturer-distributor-home store-consumer. Generally speaking, after the goods enter the dealership stage, the price begins to soar. The reason is that after the agent purchases the goods from the manufacturer at a price of 4-5 fold, the difference between the retail price of the product minus the purchase price is gross profit, and 45%-60% of the profit is distributed to the store as a rent. It also needs to add sales staff, entrance fees, promotion fees, logistics costs and other expenses. In addition, dealers should also consider the related costs of promotion price reduction, tail price reduction, etc. These foreseeable and unforeseen costs must be added to the price, and dealers can ensure profit. Furniture manufacturers have transformed “touching the netâ€. The problems of high rent, difficult distribution, lack of integrity, and poor service have increasingly plagued the furniture industry under the traditional sales model. In order to break through the bottleneck of industry development, some furniture manufacturers have transformed “touching the netâ€. According to incomplete statistics, well-known brands such as Qumei, Baiqiang, TATA Mumen, Green Island, All-Friends Furniture, Shengxiang, and Cool Manju have begun to test e-commerce. And TATA wooden doors, Green Island and other companies even mention it to the height of the company's development strategy, enough to see the company's recognition of this new marketing model. For example, Qumei e World Online Mall not only allows consumers to know the style, material, price and other related information of Qumei Furniture, but also enjoy free installation and free shipping service. The furniture is delivered to your home with a click of the mouse. According to industry insiders, furniture manufacturers moving from hypermarkets to online stores can save the intermediate links of traditional sales channels, reduce operating costs, and increase the transparency of integrity management. This is a new trend in the development of the furniture industry in the future.
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