The More the Market Shrinking, the Greater the Opportunities for High Value-Added Ceramic Products(8/29/2011)

2011, the building materials market is facing great challenges: RMB appreciation, increasing anti-dumping; rising raw materials, labor costs, real estate, building materials market is shrinking. Currently Zibo, Shandong, Sichuan Jiajiang and other areas show a large area cut-off situation, part of the product-oriented SMEs have closed down. Will the next stop and closures expand? This is the issue that a lot of ceramic companies concerned.

Situation in the industry downturn, the first to be affected is small, financing capacity which is not strong, with low-priced products to seize market enterprises. In such a market environment, the worse market, the better period for the birth of new technologies, new materials and new modes of deliberation.

No matter how bad the market is, but the rigid demand is there. We simply count the Guangzhou market, for example: Guangzhou population of nearly 15 million, a conservative estimate of the average every five people have a home, the same calculation, Guangzhou, about 300 million housing units. Property rights 70 years, average age 50 years, 300 million housing units divided by 50 years equal to a year in Guangzhou have 60,000 new housing units to meet housing needs. The average consumption of 10,000 homes each tile calculation, Guangzhou market share of new housing each year about 600 million yuan.

Guangzhou keep housing 3 million units, each housing an average of about 10 years once the transformation, the transformation of 300,000 housing units a year, assuming that a house only to transform the kitchen and bathroom, spent about 3,000 yuan a year in Guangzhou renovation calculation market demand for ceramic tile market share of approximately $ 900 million. Only the housing market in Guangzhou, the annual tile demand reached 2.5 billion, in addition to commercial real estate needs of the tile.

Even if the market fades, atrophy, but the rigidity of ceramics market there really needs, opportunities remain in the formation of crisis, decline in performance companies lost market share will be a tactical strength of the brand divided up in such an opportunity and challenges when a new product, new technology, or new marketing battle will be staged.
(Author Mosaic and Tile, China Leiyuan 8/29/2011)

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