Careful owners may find that the same house type from last year uses similar materials, and even chooses the same decoration company, but the decoration prices are obviously different, and the market price changes greatly.
Starting from the second half of last year, especially since this year, due to the impact of the epidemic and changes in the international environmental situation, raw material prices have fluctuated greatly. Some raw material prices have increased by more than 100% in one year. A reporter from Huashang Daily visited the market and learned that in the second half of last year, manufacturers of ceramic tiles, ceilings, cement, sheets, coatings and other building materials issued price adjustment notices, causing some dealers to also increase terminal selling prices.
Raw material prices are rising, but post-epidemic consumer confidence in the terminal market is still being cultivated. Decoration companies are in a dilemma between rising and not rising.
Phenomenon
Decoration raw materials have increased by more than 10% since last year
Some prices have increased by 130%
"Price increase" has become the hottest word of the year since last year, and the rise in raw material prices has attracted attention from all walks of life. CCTV Finance has repeatedly reported on the rise of decoration materials and . A piece of news that said "the price of decoration materials has risen, and the owner spent 10,000 yuan more on decoration six months later" quickly became a hot search on Weibo. The cumulative reading of this entry reached 9.391 million, and the discussion was 1,260. home decoration is closely related to everyone's life, and the price increase of decorative materials is more related to whether the quality of life of citizens can be improved.
According to data previously released by the National Bureau of Statistics , starting in 2021, the prices of steel, sand and gravel have soared like wild horses, and the market supply and demand relationship has been extremely tense.
Among building materials, the prices of glass, plastic, aluminum, steel, stainless steel, and copper have increased by about 30%-40%. Compared with the previous in the same period as , the price of copper has increased by more than 130%; not only building materials are increasing in price, most The price of raw materials for bulk commodities is increasing, such as styrene, , with a cumulative increase of nearly 50%, pulp, PVC, crude oil, and hot rolling, with an increase of more than 20%. Soda ash, rebar , glass, copper, fuel oil, aluminum and other products have increased between 16% and 20%... These raw materials are reflected in home decoration, including wires, water pipes, cement, river sand, doors and windows, etc. Gypsum board, plywood , screws, glass, air conditioners, water purification, fresh air... everything has increased by more than 10%.
Causes
The impact of the epidemic and policies
The supply of wood, sand and gravel control has exceeded demand
Renovation raw materials have increased so rapidly. What is the reason? In this regard, a reporter from Huashang Daily interviewed Mr. Yang, the key account manager of Tianliguan. He said that the rise in raw material prices is caused by many reasons. In recent years, the prices of some raw materials have been adjusted to a small extent every year. However, this year involves many industries and categories, which makes the increase appear to be too concentrated. Take sand as an example. In recent years, due to my country's environmental control, some mining areas have suspended operations and restricted production. The supply of sand has been tight, and prices have continued to rise. Starting from December 2020, the prices of copper, aluminum, zinc and other metals have increased. In addition, due to power restrictions, Due to the impact of the suspension of production, prices will naturally rise step by step.
Ms. Sun, a shopping guide for Bunny Brand, said that there is a shortage of lumber in the market, and the price of lumber has increased by more than 25% since this year. During decoration, the prices of wooden doors, floors, cabinets , and various types of woodworking boards have all increased. 80% of my country's timber is imported. Affected by the epidemic abroad, imported materials cannot be disembarked at ports, and raw materials are in short supply, which are all reasons for rising prices. "Not only are the prices of raw materials rising, but labor costs, transportation costs, etc. have also been rising over the years. When these costs are added up, consumers can no longer accept it."
"Affected by policies, taking cement as an example, some cement companies have been affected by Power cuts have limited production, and the supply side continues to tighten. Cement prices in some areas of Guangdong have continued to rise by 80-130 yuan/ton. Zhaoqing Some cement companies have announced increases. Price notice, a one-time increase of 130 yuan/ton. "
Difficulties
Testing the market for small price adjustments
But worried that consumers are not willing to "pay"
Decoration raw material price increases are reported almost every year, but this time from authoritative data and interviews. The reporter learned that the price increase of decoration raw materials that has continued since last year is not "big thunder but little rain."Industry insiders said that the cost pressure brought by this upstream price increase is no longer something that a certain manufacturer can bear, and part of the pressure will eventually be transferred to the terminal, letting decoration companies and consumers bear it.
Indeed, decoration companies are experiencing such a dilemma at this stage, hesitating between rising and not rising. It is understood that many decoration companies have withstood the pressure for nearly a year and have recently begun to release it to the market. After the National Day in 2021, many decoration companies in Xi'an have issued price increase notices. According to industry insiders, many decoration companies have been intending to increase prices since the beginning of 2021. However, they are worried about the lack of market consumer confidence, so they have been compressing costs and reducing internal energy consumption to offset the impact of price increases. However, after several rounds of price increases, it was still unable to bear it. "The price increase notice issued by the decoration company has not completely solved the problem. We are worried that consumers will not pay the bill. In order to test the market, they only raised the price slightly. There may be further price adjustments in the future." Zhou Gong, a project manager of
who has been engaged in decoration for nearly 20 years He said that on the one hand, the home decoration industry must deal with the pressure of rising prices of upstream raw materials, on the other hand, it must pay attention to whether consumers pay the bill, and at the same time, it must prevent vicious competition from peers... These aspects have made the traditional decoration companies more burdensome. Heavy and less efficient.
Way out
Seize the demand for secondary decoration
"Omni-channel" supply chain integration to reduce costs
As the real estate market changes, the home decoration industry shifts from incremental to stock game era, decoration companies have to face more than just rising prices of raw materials , the core consumer groups are getting younger and the competition in the industry is becoming fiercer, which is the biggest problem that decoration companies currently encounter. Where is the future for home improvement companies? Some home improvement companies are already exploring and trying. Lu Xuwei, general manager of
Beijing Jinzhao Decoration, said that the secondary demand for home decoration has increased significantly in the past two years. Many houses in old urban areas have complete supporting facilities and convenient living. However, the disadvantage is that their functions are lagging behind. They need to renovate the home space through secondary decoration and improve the quality of life again. Housing prices in first- and second-tier cities are high, and the potential demand for secondary decoration is even greater. Starting from secondary decoration is another way out for decoration companies. Liu Jun, general manager of
Urban Home Decoration, believes that in the future, the home decoration industry may show an "omni-channel" trend of integrating online and offline. Due to their small scale, most decoration companies have low bargaining power for purchasing building materials, so they have no ability to withstand price increases. If companies can proactively "integrate" supply chain resources through all channels, they can also reduce costs, and can offset the pressure of . ; On the other hand, it can also make decoration companies stronger and gain a foothold in the market, which is of great benefit to standardizing the market.
Prospects
The total size of the home decoration market exceeds 3 trillion
Digitization or the sharp edge
The price of raw materials has increased. Traditional decoration companies are in a dilemma. The fundamental reason is that their own capabilities are not enough to resist risks, vicious competition, and long business chains... But how to proceed? supply chain integration ? Liu Qiang, who has been engaged in Internet home decoration for many years, said that digitalization may be a sharp edge.
"Digitalization is not simply online. The key to digitalization is to establish a digital marketing system to achieve a closed-loop of refined operations, and to establish a closed-loop from customer attraction, customer follow-up, to subsequent conversion, word-of-mouth communication, and referral. This can greatly reduce the cost of Traditional companies’ customer acquisition, marketing and other costs help companies hedge against rising pressure on raw materials,” Liu Qiang said, “As the consumer group becomes younger. , consumption patterns are diversified, consumption thinking is changing from maintaining life to enjoying life, and the home decoration industry has broad prospects. The total size of China's home decoration market has exceeded 3 trillion yuan. However, the digitalization rate is low, and the digitalization rate of home decoration companies is 19.2%. Many industries have seen future prospects, and home decoration practitioners should also change their traditional thinking and try to combine online and offline digitalization to tap a larger market. " Huashang Daily reporter Qian Pengru
