Industrial diversification plays an important role in the expansion strategy of some super-large enterprises. As far as the electrician and lighting market is concerned, Haier, Aucma and Shuaikang have been stationed in the past. Recently, Xoceco and Yangzi brands have been nationwide. Look for "electrical OEM suppliers. In addition to cross-industry entry into the electrical field, the lighting brands closely related to it are also “out of the lineâ€. In order to occupy a place, the electrician market seems to be unusually lively. From the end of 2006 to the beginning of the year, after the lighting brands such as NVC and Opp entered the electric field. The old-fashioned Lantern brand Huayi brought its electrician products with its Auxos, and then Huatai’s Martin Electric was born out of the world. Overnight, Huatai once again became the focus of the industry. Sanxiong? Aurora Lighting and Benbang International Lighting also followed quietly. Recently, I heard that the popular Haohao Lighting is also preparing to enter the electrician city...
Diversified management to create a superior enterprise
The research and debate on “holding the industry†and “diversity management†have cases all over the world. Observers say that in fact, most diversification has failed. The research results tell us that whether an enterprise expands through acquisition or internal diversification, as long as it adheres to the industry, it can override other industries, and the diversified industry with the single technology as the core is the most successful. The second most successful is the company entering the relevant field. The most unsuccessful is the company that has entered many different types of businesses, and the diversified practices of such companies often fail.
The failure of diversified business did not prevent the implementation of the company's expansion strategy. On the contrary, the diversification of excellent enterprises was a great success. Based on the research of successful diversified business cases, the researchers believe that it is not a matter of sticking to the industry, but to implement diversification, but be cautious, even in the diversification of a single technology. In the diversification of related fields, we must also be careful to operate businesses that are not related to the industry. This conclusion provides a theoretical basis for diversification of enterprises.
In fact, in the field of lighting and electrician we are familiar with, there are cases of diversified operations, such as Haier entering the field of electrician, Shuaikang entering the lighting industry, Dongling investing in lighting and electrician fields, all of which belong to diversified businesses that enter different types of business. So the risk is correspondingly larger.
Five types of competitiveness faced by new entrants
Although diversification has proven to be effective, new entrants are also facing multiple competitive pressures. The market capacity of the electrician industry itself limits the number of electrician brands. In the future, the competition in the electrician market will inevitably exceed the lighting industry. The situation of “poor porridge and more†has made many brands look awkward, which is to some extent The brand that determines the easiest entry into the electrical field is the future leader in the field of lighting.
From the perspective of competition, the competitiveness of new entrants in the electrical field mainly includes: first, the competition of existing manufacturers in the electrical industry; second, the bargaining power of suppliers; third, the bargaining power of customers; fourth, other new entry The threat of the person; five, the threat of electrician substitute products.
Correspondingly, the new entrants also face the following five barriers to entry: First, economies of scale; Second, product differentiation; Third, capital needs; Fourth, cost disadvantages; Fifth, distribution channels.
From the current situation, the competition of existing manufacturers in the electrical industry is the most important amount of competitiveness. Relatively speaking, the electrician market has a certain scale, the market is relatively mature, there are a certain number of well-known brands in different positions, and new entrants will inevitably compete with one or more of them to seize resources, but Obviously, industry relevance does reduce a lot of risk, but the cost is still high. First of all, existing manufacturers have a certain scale, so they have the low-cost competitive advantage generated by scale effect and industrial experience. They have relatively stable business resources and brand awareness. New entrants must seize a certain market share or even surpass competitors. A positive conflict will occur sooner or later. In addition, suppliers and customers are two competitive forces that are easily overlooked. Strong supplier confidence in new entrants, as well as supply share and mutual relationship will affect the entry cost of the manufacturer. Similarly, strong customers are new to entrants. Confidence and mutual relationship will also affect the entry cost of manufacturers. They represent the upstream and downstream resources of the industrial chain. The stronger the bargaining power, the greater the pressure on manufacturers to enter and the higher the cost. Finally, if there is a conflict between new entrants in positioning and channels, competition is inevitable, and the threat of electrician substitute products is everywhere.
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