Apocalypse of the collapse of the hottest fortes l

Apocalypse of the collapse of fortes lighting: don't make these mistakes

at the beginning of this year, the LED lighting industry ushered in a "chill": Wang Gongjie, the legal representative of fortes lighting, issued a declaration of bankruptcy and liquidation of fortes, which became the first LED lighting enterprise to go bankrupt in 2017

twelve year old LED lighting enterprise collapsed

foster lighting was founded in 2004. It successfully applied LED technology to create a series of innovative and environmental friendly civilian LED energy-saving light sources, and its sales network is more than 90 countries and regions in the world, such as Europe, Asia Pacific region, the Middle East, Africa, North America and South America. In 2013, foster lighting changed from a single chip lamp king to a full range of high-end LED household products, Successfully completed the transformation and upgrading of products, and is one of the well-known designers, manufacturers and distributors of environmental protection and energy-saving lighting products

at its peak, fortes increased its capital by tens of millions to carry out share reform and brand upgrading, and invited Hong Kong Film emperor Liu Qingyun to be fortes' spokesperson to direct its advertisements to CCTV, the most influential in China

however, the situation began to deteriorate sharply from 2014. At that time, due to insufficient judgment on the economic situation, the company was troubled by cash flow tension. In 2015, in order to find a way out, fortes expanded to four major operation centers in China, and its products went deep into the region where the operation center is located and the third and fourth level markets in the country, developed more than 10 provincial agents, and developed more than 500 fortes dealer stores

despite many efforts, fortes lighting still failed to survive. On January 4, 2017, Wang Gongjie, the legal representative of fortes lighting, issued a declaration of bankruptcy and liquidation of fortes, and the twelve year old lighting enterprise collapsed

the bankruptcy of fortes lighting reflects many problems of today's LED lighting enterprises. We will analyze them one by one

the triangle debt problem leads to the rupture of the capital chain

the most direct reason for fortes' bankruptcy is that the triangle debt problem leads to the rupture of the capital chain. In fact, before fortes announced bankruptcy, orders were always full. However, due to the fact that most of the payment for goods has been defaulted or even become rotten debts, coupled with the soaring raw materials, the product price has not been raised, and the profits have been diluted, which eventually led to the fracture of the capital chain and excellent chemical corrosion resistance, and the failure to pay the supplier's payment in time. Thus, the supplier refuses to supply raw materials. Under such circumstances, even if fortes received the order, it could not produce, and the payment for goods was in arrears, which made it unable to pay the supplier, thus forming a vicious circle, and finally the company went bankrupt

the so-called "triangle debt" refers to the common name of unpaid loans that should be paid by enterprises through the collection and payment period or the agreed payment period. It is a chain debt relationship formed by overdue loans between enterprises. Reflected in the LED lighting industry, that is, the customer defaults on the payment of the application manufacturer, the application manufacturer defaults on the payment of the packaging factory, and the packaging manufacturer defaults on the payment of the upstream chip and auxiliary material factory. The original normal industrial chain then becomes a risky debt chain

the triangle debt problem will be more serious in the LED industry, because at present, there is a serious overcapacity in the LED industry, and the market competition is extremely fierce. In order to attract customers, enterprises begin to fight for service, payment cycle, price and minimum profit. Because the profit is very low, there is not much capital that can be used for turnover in the book, which may lead to the rupture of the company's capital chain and make the enterprise fall into a hopeless place

lack of core brands and inability to cope with the rise in raw material prices

the rise in raw material prices in 2016 also exacerbated the collapse of fortes lighting. Looking back at the price rise of materials in the LED lighting industry, since March 2016, the price of some LED chips has increased by about 10% under the leadership of Jingdian and San'an. Then Mu Linsen, Xinda optoelectronics and Guoxing optoelectronics increased the price of RGB light beads used in display screens by 5% - 10%. At the same time, this wave of price rise has also rapidly spread to raw materials, substrates, as well as precious metals such as gold and silver. The price continues to rise, leading to the rising cost of the core components of LED devices - gold wire and silver bracket. At the same time, the labor cost also continues to grow

now, aluminum prices have soared since October 2016, following the tight supply and demand of copper foil, which has driven up the price of aluminum substrates. Insiders said that at present, aluminum has increased by about 40%, steel plates by 20% and aluminum substrates by 40%. The rise in aluminum prices has directly affected the prices of aluminum substrates, lamp housings, radiators and other accessories that use a large amount of aluminum. The prices of some products have increased by 20%. For example, the price of aluminum shell of LED driving power supply rises, and the cost of each power supply accessory rises by 0 3 yuan

according to the information on the official of fortes, fortes' main products include: LED light band, LED bulb, LED lamp cup, flat lamp, projection lamp and other product series. Strictly speaking, these products belong to the "sphere of influence" of professional OEM factories. These public model products have formed a relatively perfect professional OEM system in the industry. The price is almost transparent, pursuing cost performance and cost competitiveness

the rise in the price of raw materials is undoubtedly a fatal blow to fortes, a OEM enterprise without a brand, because it does not have a product with core competitiveness, so it can only rely on the price to "earn money". Once the raw materials rise, but the product price cannot rise, and finally the enterprise cannot make profits, and can only be eliminated

OEM to brand failure

maybe it's because it realizes that fortes needs to build its own exclusive brand. Since 13 years ago, fortes has begun to seek the way to transform its brand from OEM, and began to invest heavily in advertising. It even invited Hong Kong Film emperor Liu Qingyun to endorse it, broadcast it on CCTV, etc., and expanded to four major operation centers in China. Its products go deep into the region where the operation center is located and the third and fourth level markets in the country, and has developed more than 10 provincial-level agents, And develop more than 500 fortes dealer stores

however, this is obviously a biased sword. A large amount of advertising investment can not save Ford from the shortcomings of rapidly raising the piston to reduce the auxiliary time. The serious homogenization of Ford's products, and the lack of investment in product differentiation and personalization makes fortes unable to change the essential problem. Xiezhengwu of yunzhiguang lighting micro classroom believes that brand promotion will not bring more bonus effects to fortes' OEM products, and may even be excluded from the OEM consideration of large enterprises because of its own brand effect. After all, no one is willing to cultivate their future competitors

Xie Zhengwu said that if fortes is determined to build a popular home lighting brand, it needs to adjust its product line accordingly on the basis of the original production line, and vigorously expand the characteristic products that meet its brand positioning. For example, we will expand a complete range of household led spotlights and led ceiling lamps to meet the product needs of dealers in different regions and styles. Only by constantly improving and upgrading the standard product series, creating products that conform to their own brand characteristics, and cooperating with the brand momentum, can we retain dealers after investment promotion

four inspirations

as the LED lighting industry becomes more and more mature, more and more disadvantages are shown: high degree of product homogeneity, fierce price war, market downturn, low profits, rising prices of labor and raw materials, etc., especially since 2016, raw material prices have soared, the state has carried out environmental supervision, and implemented the producer extension system program, D lighting enterprises are facing the crisis of being eliminated. The era of huge profits in the LED lighting industry has passed. Today, a Forte has fallen, and more "fortes" will fall in the future

the bankruptcy of fortes has exposed the problems of many LED lighting enterprises. We have to be alert to how the LED lighting industry should go in 2017

first, choose high-quality partners and be alert to triangle debt. LED lighting enterprises should carefully screen partners and customers, and choosing friendly cooperative enterprises with high reputation is also one of the important measures to avoid falling into triangular debt. In addition, the "payment before goods" system is also worth learning by LED lighting enterprises. Nowadays, more and more factories adopt the method of payment before delivery: when the payment arrives, the customer can carefully consider the variety and quantity of purchase, and do not purchase randomly. If the debt is owed, there may be random purchase; At the same time, the delivery of goods upon payment can make customers sell products more carefully; In addition, delivery of goods after payment can make the relationship between cooperative enterprises better, because cash customers must be the most cherished customers of the enterprise, and the enterprise will return with the greatest preferential efforts

second, differentiated and personalized development. For a long time, the serious homogenization of LED lighting products has led to a fierce price war, which has also led to the continuous collapse of countless small and medium-sized LED lighting enterprises. Now the market competition environment of pure price competition has gradually shifted to the technology and reliability of competitive products. The development and issuance of products with independent characteristics is the key to whether enterprises can maintain their market position. The differentiation and personalization of LED lighting products can help enterprises forge brands, Increase market recognition and win the market. Chenxuesong, the founder and CEO of Chengdu Minchuang technology, said that now the products of major domestic manufacturers tend to be homogeneous, resulting in meager profits for enterprises, and the winners of the price war can't get more profits. The differentiated development route of enterprises is particularly important

third, build brand effect and deal with the price rise of raw materials. Facts have proved that the road of only doing OEM without independent brand will only make enterprises lose the initiative of the market and be very passive. Yao Dichang, general manager of delcheng technology, said: "nowadays, the electronic industry is unpredictable. Laymen don't understand the technical content of products. They generally choose brand goods to ensure quality. Experts will also choose products with reputation and brands in products with the same technical content."

fourth, enter the high-tech field. For lighting enterprises with capital, technology and channels, they can consider actively entering the high-end lighting fields such as plant lighting and automotive lighting. At the same time, the hot smart lighting has also been recognized as a "must compete place" in the industry

according to the prediction of the Chinese Academy of Agricultural Sciences, the demand for agricultural LED lighting and its control equipment will reach several billion yuan in the next five years, and will reach 10 billion yuan in 10 years, with an annual growth rate of 20% - 50%; The total scale of agricultural semiconductor lighting industry is more than 100 billion yuan

according to the data, the market output value of LED for interior lighting reached US $605million in 2015 and is expected to decline to US $586million in 2020. The LED for exterior lighting is in a state of rapid rise in the process of dynamic load experiment. The market output value of LED for exterior lighting reached US $1.21 billion in 2015 and is expected to grow to US $2.13 billion by 2020, with a compound annual growth rate of 12%

according to data analysis, the overall market of intelligent lighting is expected to reach US $8.14 billion by 2020, and the compound annual growth rate of the industry from 2015 to 2020 is 22.07%