Hot Spot Analysis Of Domestic Lighting Industry

- Sep 13, 2018-

In 2018, affected by the economic environment at home and abroad, the lighting industry entered the stage of structural adjustment and industrial integration and reshuffle that was pre-judged a few years ago. The two hot days of the industry were particularly prominent in the first half of this year. Summarizing and analyzing the hot spots in the industry and judging the trend of the lighting industry in the future are of great significance to all parties in the lighting industry industry chain. Not optimistic does not mean pessimism.

Basic situation of the lighting industry
The total output value of the lighting industry has maintained a fast, stable and sustained double-digit development trend in 1998 and 2017. In 2015, the growth rate has entered single digits. In 2016, it was affected by the decline of exports, and resumed growth again in 2017.


Table 1: Sales of China's lighting industry from 1998 to 2017
Exports have basically maintained a growth trend. The two declines were due to the decline in exports of the 2008 world financial crisis in 2009, and the decline in exports caused by the decline in international market demand in 2016. The export ratio has basically accounted for between 40% and 45% of the total output value for many years.


Table 2: Exports of China's lighting industry from 1998 to 2017

Table 3: The proportion of exports in total output value
As can be seen from Table 4, LED lighting began to erupt in 2013. It is conservatively estimated that the LED lighting industry accounted for more than 85% of the total output value in 2017. LED lighting has become the absolute mainstream of the lighting industry.


Table 4: LED lighting as a percentage of total output value (100 million RMB)

Circulation market
Most dealers generally reflect that this year's market is the most difficult period since the industry started. From the analysis of the city, the central city has dropped significantly, 30% or even higher. From the regional analysis, the southeast coastal areas fell significantly, most of which reflected a decrease of more than 30% in the first half of the year compared with the same period of last year, and a slight decrease in the western and southwestern regions, about 15%.
Some professional lighting markets have been subject to the demise due to the impact of the environment. The changes in the market naturally affect the production enterprises. Some enterprises, especially decorative lighting companies such as homes and lanterns, have a turnover of 30% or even 50%. Even if the company's revenue grows slightly, it faces the pain and embarrassment of falling gross profit.

The analysis of the decline mainly has the following reasons: economic restructuring, especially the regulation of the real estate market, resulting in a decline in demand; the role of designers to play, increased the hidden channel share; hardcover room requirements, integrated ceiling, formed The development of e-commerce (Jingdong, Xiaomi, Tmall...) diverted the market for some standard products; brand awareness increased and sales became more concentrated.
While the overall market environment is not optimistic, some companies continue to maintain a steady growth in revenue and profits, such as Op, Sidon, and Qiyi.

Measures taken by enterprises to continue to grow include: strengthening the promotion of brands; strengthening product development and market development in subdivided professional fields; expanding new business and channels; strengthening services and providing overall solutions.
The sales model of the merchants who opened the store, hang lights, and waited for buyers to go to the door has not adapted to the current market situation. Dealers need to find changes. Similarly, manufacturers need to seek changes in the new economic environment, otherwise they will be shuffling. In the process of integration, it was eliminated.