Where should home dealers go in the future? We have discussed this many times. To be sure, dealers will not disappear, but how will the future of this group evolve? Seeing the final result may help us find the way to go now.
At the "Restructuring internal circulation | China's future retail power conference" jointly organized by today's furniture, Shenzhen Fashion Home Design Week and the 35th Shenzhen International Furniture Fair, li Yi, founder and chief expert of future business think tank and chief editor of China Pan-home industry trend report, shared his thoughts on the changes of home dealer system.
What I want to share today is a grand topic, which may look like a "Fortune Teller". Let's stand on the standpoint of distributors and think about possible changes in the distributor system in the future.
When we made the 2020 China Pan-household industry trend report, we systematically considered the changes of the industrial chain. Our thinking mainly includes six dimensions. The first is "thinking of the whole industry chain", thinking about the changes of the whole industry chain from the perspective of real estate, decoration, distributors, retail stores, brands, third-party services and super platforms.
The second is "large-scale thinking", which is based on the present and thinking about the whole industry from the past and the future.
The third is "global vision", the fourth is "technological penetration", the fifth is "consumer insight" and "Entrepreneur's lifelong growth".
Then in the whole industrial chain, changes in each link will bring changes to distributors. For example, after doing market research in Hunan recently, it is found that there may be only half of the decoration companies in some cities last year. Changes in this channel will affect distributors. If our distributors still do their own three parts per mu as before, it will be difficult to do business well today.
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1. Look at the position of dealers in the future from the iron triangle of business evolution
what are the main roles of future business evolution? I define it as brand manufacturer, decoration company and home furnishing stores, all of which eventually reach consumers through retail. Retail is the ultimate connection user, which is closely related to distributors.
Then we should ask two questions: first, how can today's agents survive? How to develop?
Second, how can future agents surpass today's agents? In other words, what kind of business will "kill" the traditional agent system in the future?
So we need to clarify three questions: What is the retail trend of the industry? Under such a trend, what kind of business model should we use to change to survive? And how to do it?
The trend is not something that didn't happen, it just didn't happen on a large scale, actually it has happened on a small scale. We need to find the direction of future development through small-scale trends. I divide these trends into three categories-Industry Trends, user trends, and technology trends.
(I) industry trends
in the past, our industry was mainly engaged in incremental market. Anyone who came in had money to earn. Today, we are engaged in stock market. Some people say that the stock market is the "second-hand housing market", which I don't think can be defined in this way. Because in the past, the new house market and the old house market were actually the same market, which I call "retail market". In this market, our distributors can do their business. Similarly, decoration companies can also do it.
But today, after the birth of hardcover housing market, many dealers and decoration companies can't do this part of business. In other words, the original retail market was divided into two markets-Hardcover housing market and second-hand housing market.
What about the future? I think the next 5 to 10 years will be a "shrinking" market. That is, the proportion of hardcover houses has been greatly reduced, and second-hand houses have become the mainstream. Therefore, many people expect the Pan-household industry to be a 4 trillion-year market and is still growing. Have you ever thought about whether there are 4 trillion in the future? Maybe there will be a slight increase in the whole market, which is only the increase in price, but not in quantity.
(Ii) user trends
today, our user behavior has changed greatly. Everyone is talking about the post-80s and post-90s. I quote a community retailer: Today, we do not deliberately distinguish the middle class, but to distinguish the crowd by house price.
For example, in Beijing, with the housing price of about 80000 yuan as the scale, it basically defines the position of the new middle class, and only needs to do business around such a community.
(Iii) Technology Trends
industrial internet and mobile Internet are affecting our industry, but the degree of impact is not enough. After 3~5 years, when the changes in technology and industry have basically stabilized, we will find that the whole industrial pattern has changed. After the whole industrial chain has been thoroughly interconnected, the original distributor system may not be able to adapt to changes in the environment.
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li Yi, founder and chief expert of future business think tank
2. What is the changing trend of the distributor system?
We will find that where users are finally reached is to provide users with comprehensive solutions. The future mode of single-category operation may be very dangerous. Of course, it is not that a single category cannot survive, but that the current single category business model and system are not enough to support future development, and the future terminal supplies should be the overall solution. The "whole" here is not a simple package, it refers to the complete satisfaction of user needs.
In the future, local distributors should be able to provide comprehensive solutions locally, and brand enterprises should also lead distributors to comprehensive solutions, or brand enterprises should become providers of single items in the solutions.
One dimension of our thinking is "large-scale thinking". From the perspective of decoration company, its evolution path.
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scale 1: The decoration company has gone from the earliest contractor to the hard-fitting company to today's assembly company. In fact, today's package company may be a retail company. In fact, many package companies are transforming into retail companies. Many decoration companies may become retail channels or brands in the future, so I said last year that "the whole package is dead". Because decoration companies must eventually evolve into retail companies to survive.
Scale two: building materials market from the original dirty mess to single stores, chain stores. Today's stores are actually rent-collecting businesses, not retail companies. Today's stores are turning to "User-centered". In this way, it can be called a retail store.
But this is far from enough. Why is the vacancy rate of hypermarkets high? Why do many brands withdraw? Because today's form of stores cannot fully adapt to the future development.
The convergence of these two scales, together with the evolution of brands and agents, will eventually form "the last kilometer competition", that is, the Community competition.
In the future, under the market trend that the second-hand housing market occupies the mainstream, if brand enterprises cannot occupy the position of the last kilometer in the terminal community or dealers cannot enter the competition system of the last kilometer, it means that there is no future. Therefore, in the future competition of retail of home building materials in China, the final success lies in the last kilometer of retail terminal.
3. Exponential growth of small formats: large background and small front end
I positioned the competition model of the last kilometer as "small business", which is just like the fresh food store at the gate of our community today. Small formats will show exponential growth, forming a "big background, small front end". Of course, there is a set of logic and business operating system behind the "small.
The future distributor system will have four characteristics at the terminal: integration, service, joint operation and miniaturization.
Distributors should think about how to do integrated services. If their single products have competitive advantages in the industry, they will have room to survive and can link with companies that provide integrated services.
Service-oriented, although we proposed that distributors should be "service providers", their understanding of it is not enough. Service providers need models to support them, otherwise they cannot continue. In the future, only when Brand Enterprises and agents transform into "small formats" can they truly become service providers. Secondly, service providers are the result of competition in the whole industry, and small formats will have a fatal impact on large enterprises.
How can single-category enterprises achieve joint operation? This is just an idea, not a final solution.
Miniaturization is not simply a reduction in scale. Business models find golden section ratio in the continuous practice of "big and small.
How do distributors choose manufacturers today?
Distributors need to have the thinking of manufacturers and need to evolve with manufacturers. When choosing manufacturers, we should choose those brands that can realize the integration of manufacturers, and the brand system that cannot realize the integration of manufacturers has no future. Because the core of today's business development is "Informatization", when we use this scale to measure industries and enterprises, it will be found that few enterprises have realized "information integration" from manufacturer headquarters to terminal distributors ".
Today, I just talked about the outline of the changes in the dealer system in the future. As for what each dealer should do, I need to think about it according to my own situation. Although you are a distributor, you should also understand the changes in the pattern of industrial development, and then think about how to change as a distributor, how to choose, and how to change yourself.
(Article Source: US today furniture official website, invasion and deletion)
