If I want to order a set of pu ceiling cornice, there is no difference in this industry like the home textile industry. What you can do, other companies can do. It is nothing more than the difference in materials and prices, as well as small designs. This means that all custom home furnishing companies have no substantive pricing power. And that is indeed what investors care most about.
The crowns pu ceiling cornice mouldings also feel business opportunities in this industry.
There is also a process of integration and competition between cabinets and wardrobes in the custom home furnishing industry. The overall whole-house design must be the future direction. Companies such as Oupai, Zhibang, and Gold Medal, which are good at cabinets, have stepped into the wardrobe customization field. Their method is to rapidly expand the customized wardrobe market with low gross profit margin. The traditional custom wardrobe manufacturers Sofia and Hao Laike also used the same method to quickly enter the custom cabinet market. In 2017, the gross profit margin of Zhibang’s cabinet business was 36.78%, while the gross profit margin of the wardrobe business was only 25.98%. Sophia, on the contrary, has a gross profit margin of 40.72% for its wardrobe business and only 23.03% for its cabinet business.
Real estate regulation risk: The downstream customers of customized furniture are mainly new house renovation and second-hand house renovation in the real estate industry. Therefore, it is bound to be restricted by changes in the entire real estate industry. Listed companies are constantly reminding the risks of real estate regulation. The author believes that the real risk is the disappearance of China’s demographic dividend and the risk of an aging population. With the arrival of the population inflection point, real estate will also usher in an inflection point, which will inevitably bring an inflection point in the scale of the furniture manufacturing industry.
The crowns pu ceiling cornice mouldings hope that consumers are satisfied with their products.
Risks of dealer management: The operating income of custom home furnishing companies mainly comes from dealer channels, and most of the specialty stores are specialty stores operated by dealers. For example, in 2017, 91.2% of Sophia Wardrobe’s revenue came from dealer channels, and revenue from directly-operated stores only accounted for 3.6%. In the first half of 2017, 7 custom home furnishing companies were listed on the A-share market. These companies are forced by industry competition and the capital market’s need for financial statement growth, and almost all of them do the same thing after IPO-that is, expand dealer channels. When everyone is in the same market to attract investment and expand stores, the whole cake will not be enlarged at the same time, but will only bring competitive pressure and distribution channel control risks.
Post time: Oct-29-2020