Go out and look for a "new engine" Mergers and acquisitions, proximity to the market, brand transfer to major modes of overseas expansion of power equipment companies The days of power equipment companies undergoing transformation and upgrading are not getting too far. The overcapacity in the domestic market, the vicious competition in the industry, the increase in the cost of production materials, and the increase in labor costs have made it increasingly common for equipment companies to go abroad to expand overseas markets. In the market, how can companies go out and go full-time, and it is still a topic that needs urgent consideration. “As the slowdown in the domestic economy slows down, the supply and demand market for the electrical industry is not optimistic this year, and the momentum of growth in the electrical industry average annual growth rate of 30% is over. In the second half of last year, orders from many companies decreased significantly. In the first half of this year orders were slightly better than last year. , But profit margins and sales prices have fallen sharply.†On July 19, the Deputy Secretary-General of the China Electrical Equipment Industry Association, Bai Wenbo, said in an interview with reporters that power equipment companies are faced with the task of transformation and upgrading, but also to go abroad to find new ones in due course. The point of growth, for now, is that the way companies adopt overseas mergers and acquisitions is a model that can be used for reference. In fact, it is inevitable that companies will continue to expand overseas markets and go out in due course. However, in the eyes of most entrepreneurs, the road for Chinese enterprises to go out is not smooth. In addition to capital and technology, investment decisions, market changes, and legal obstacles Cultural differences, political instability, and other factors have made it difficult for companies to go global. Therefore, looking for a business model that suits itself and a new point of growth for profit, targeting the company is a problem that lies ahead of the company. Going abroad Since the first half of 2012, China's electrician industry has experienced a rare "negative growth." Power equipment industry such as wire and cable, transformers, fans and other industries have various levels of excess capacity, profit decline, vicious competition, quality decline and other ills. Some equipment capacity utilization even less than 50%, raw material costs even accounted for 70% of the selling price, "Transformer on the catty" has become a laughing stock in the industry. "At present, China's power transmission equipment manufacturing industry has undergone rapid development and fierce competition. It is an indisputable fact that there is a serious overcapacity. The primary problem facing the Chinese transformer industry is still the issue of market development. While striving to develop the domestic market, we must further develop overseas markets. "Wang Dehua, deputy general manager of Xi'an Xidian Transformer Co., Ltd., told the "China Power News" reporter. In fact, exploring the overseas market is not only a problem faced by the transformer industry alone, but a common outlet for the entire power equipment industry. Equipment companies under the “profit†are only able to go out and open up the international market before they can “shrink†in the coming year. "Standing firmly in the middle. However, with the changes in the environment at home and abroad, it is more and more difficult for power equipment companies to go out. The deep-seated contradictions of the financial crisis have not yet been effectively mitigated. Chinese enterprises are not competitive in the high-end market, and competition in the low-end market is further aggravated. They do not have brand benefits, and they are more stringent in terms of policies, taxation, employment, and environmental protection. Demanding requirements. Xu Xiang, president of Daquan Group, believes that: “It is a general trend for companies to go abroad to expand overseas markets. In the future, Daquan Group should go hand in hand with the domestic market in terms of international market share and staffing, but the specific timetable also needs to be tailored according to changes in the market, because the market Changes are fast and full of unknowns. Corresponding sales models, management innovations, and localization strategies must also be adjusted." Innovation model Going out of equipment companies will inevitably face the risks of policies, environment and management. Although it can be sure that the scale of going out will be greater and greater, it is still difficult to assert the level of profitability, which requires companies to accumulate more experience in the development of foreign projects. “Power equipment companies go out mainly in the following ways: First, they are close to the market supply side. For example, explosion-proof products mainly serve the coal mines and petrochemical industries. There are many petrochemical enterprises in the Middle East, and some domestic companies set up factories in Iran. Better The front-end market provides direct services, and the second is to set up factories in the front of raw materials, for example, some special transformer enterprises in the country go to open plants in Africa, because they have cheaper copper prices, they turn Africa into a component processing plant, and the products are still shipped back to China for consumption; The third is to directly merge companies overseas. Wolong Electric Group's merger with German ATB is a successful example; Fourth, the transfer of brand value, such as the low-voltage electrical industry, the purchase of European SME brands, OEM production.†Bai Wenbo told reporters . After the Wolong Electric Group acquired the German ATB Group, it did not send a large number of managers and technical personnel to Germany. Instead, it implanted some Chinese-style management methods in the form of a board of directors and continued to expand the scope of mergers in Europe. After the completion of the acquisition, Wolong Electric can With ATB's brand and market network in overseas markets, the company quickly increased its market share in the international market and entered the global high-end motor market. In fact, it is more and more difficult for China's power equipment companies to go out. On the one hand, the international demand for electricity and environmental protection continues to increase, and the cost of investment increases. On the other hand, due to the influence of the West, Chinese companies have also encountered a lot to go abroad. “On the basis of transmission and distribution, there are very few successful cases where the front end of the market is going out. If there is no market as a basis, it is only meaning to transfer labor costs and go out for tax avoidance. It's a good choice," Bai Wenbo said. Practice well In recent years, the sharp decline in orders in the international market has both the impact of the economic environment and the normal reaction of the economic development cycle. However, from the perspective of the international market, the demand for high-performance electrical equipment is still growing, and the market's territory and space are still expanding. This forced Chinese equipment companies to work hard on core technologies and product quality. Although enterprises go out and face many uncontrollable factors at the fiscal, taxation, political, and cultural levels, it is undoubtedly the only way to expand the international market. "At present, China's exports of foreign power equipment products are generally unable to sell a good price. Although individual industries have reached an international leading position, a large number of basic industry products have not reached the international average, and in the international market, there are few independent brands in China. The development of the electrician industry in recent years is indeed a lot stronger than in the past, but in general there must be a sober understanding, the industry transformation and upgrading without delay.†Bai Wenbo said. In this regard, Xu Xiang deeply felt: “Daqing Group has almost no gaps with foreign products, but the hardware and software conditions for participating in the international market still require a process.†The “Hannover International Industrial Fair 2013 in Germany†held in April this year It was his deep understanding that with the industrial upgrading and the implementation of an internationalization strategy, Daquan is transforming itself from a domestic-oriented market to a global one, from technology-based innovation to technology-led innovation. Wang Dehua also believes that China's transformer companies need to work hard to improve their product quality and performance and control costs. Develop low-loss, low-noise and reliable environment-friendly power transformer products that meet the standards of Europe and the United States and special environmental requirements, and carry out a series of work in changing sales models, improving after-sales service quality, brand promotion, etc., in order to successfully open the international market Lay the foundation.
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