Sales of home appliances to the countryside exceeded 400 billion yuan

The soon-to-be-exited bonuses for the home appliances to the countryside policy have hit the public appliance stocks.

According to a recent joint notification issued by the Ministry of Finance, the Ministry of Commerce, and the Ministry of Industry and Information Technology, on November 30, 2011, home appliances to the countryside in three provinces and one city, including Shandong, Qingdao, Henan, and Sichuan, will end “as scheduled.” After that, The original subsidy objects purchased home appliances to the countryside will no longer enjoy financial subsidies.

According to the previous plan for home appliances to the countryside, another 14 provinces and cities will expire at the end of November next year, and the rest of the country will expire at the end of January 2013.

Corresponding to this, Haier, Skyworth, Hisense and other home appliance companies have seen a cumulative decline of more than 20% in stock prices in the past few days. On September 19th, the share price of Haier Electronics, the largest beneficiary of home appliances to the countryside, plummeted by 27%. , the lowest share price in the next year, and Skyworth Digital and Hisense Kelon's share price also fell 10.2% and 4.8% on that day. On September 20th, Haier Electric's share price rebounded by nearly 5%, and Skyworth and Kelon's share price continued to decline.

“The capital market overreacted.” On September 20, a person in charge of a household electrical appliance company told reporters that in fact, since April 2011, sales of home appliances to the countryside have fallen month-on-month, and the enthusiasm of manufacturers and distributors Has been greatly reduced.

In addition, more importantly, in the four years since the implementation of the home appliances to the countryside policy, the big brands not only drove the small and medium-sized brands that originally occupied the third and fourth-level markets out of the market, but also built up relatively perfect three- or four-level market channels, even if the policies After exiting, the growth in demand in the rural market will continue to maintain the growth of the tertiary market.

Four years sales exceed 400 billion yuan

After the stimulus policy for home appliances to the countryside reached its peak in 2010, it has begun to decline since the beginning of this year. From November 2007, the policy of home appliances to the countryside began in the provinces of Shandong, Henan, and Sichuan, where the agricultural population is the largest, and the policy was withdrawn at the end of November this year. In four years, home appliances went through an unusual road, and by 2011 it has begun to show a downward trend.

Home appliances to the countryside led to the explosive growth of the rural home appliance market. According to the data released by the Ministry of Commerce in early September 2011, by August this year, home appliances to the countryside will accumulate 180 million units of products sold in the countryside, realize sales of 405 billion yuan, and issue financial subsidies of 46 billion yuan, which will be used for intermediate refrigerators, color TVs, and air conditioners. Washing machines are the fastest-growing products for home appliances to the countryside.

The home appliances to the countryside is also a big brand feast. With the financial subsidies, Haier, Hisense, Midea, Skyworth and other big brands have become the winners of home appliances to the countryside, gradually whipped up and erode some of the original 34 small and medium-sized brands. Taking Haier as an example, in 2009, the nationwide promotion of home appliances to the countryside, it realized a rural income of 20 billion yuan, and its sales scale in the rural market increased by 80%. In 2010, the scale of home appliances to the countryside exceeded 35 billion yuan. Yuan, the sales revenue of its daily control chain channel, is expected to exceed 50 billion yuan this year.

The capital market also gave a positive response to the policy of home appliances going to the countryside. After Hong Kong-listed Skyworth Digital promoted the home appliances to the countryside policy, its stock price once rose from the lowest of 0.28 Hong Kong dollars to nearly 10 Hong Kong dollars, and it has grown for more than a year. More than 30 times.

However, after the stimulus policy for home appliances to the countryside reached a peak in 2010, it has begun to decline since the beginning of this year, and the sales of home appliances to the countryside have begun to show a sequential decline.

Yang Dongwen, vice president of Skyworth Group, pointed out that “home appliances to the countryside have become a taste for suppliers and manufacturers in many places. Because many local governments default on the financial subsidies of dealers, which leads to lack of enthusiasm for distributors, and manufacturers have already begun to shrink under this year. As for the proportion of rural products shipped, Skyworth has exceeded 70% of the sales of non-countryside products in the rural market."

And Wang Jinliang, Vice President of China Refrigeration Appliance Group's China Marketing Headquarters, pointed out that “Home Appliances go to the countryside for product bidding in October each year, and the price of tender products cannot be modified after the end of the year, but raw material prices have been rising since the second half of 2010. Businesses also need to pay 6% VAT to local governments, so dealers are less and less active in sending home appliances to the countryside."

Rural channel changes

Some small and medium-sized brands or counterfeit products have already been eliminated from the market due to home appliances to the countryside. At the time when the subsidy policy was lifted and exited, a number of home appliance companies that have benefited from home appliances to the countryside in the past few years have experienced a sharp decline in their share prices. This reporter learned that Haier’s share price has risen more than 10 times in home appliances to the countryside, while its share price has fallen by more than 20% in recent days.

Huang Xiaowu, deputy general manager of Haier Electric, pointed out that the impact of the cancellation of the policy is not expected to exceed six months, because with the increase in rural income and the upgrading of home appliances, the demand for rural home appliances is still large, despite this year's Haier appliances three or four market household appliances The income contribution to the countryside has dropped from the previous 80% to 50%, but I believe the business will still grow as expected.

In August of this year, the US investment agency Carlyle even issued a 1.07 billion Hong Kong dollar convertible bond to Haier at its highest share price. The main reason for this is that Haier’s successful sales channel arrangement in the 3rd and 4th level markets is the key to this. With the opportunity to establish home appliances to the countryside.

Haier Electronics has added tens of thousands of retailers and franchise stores in the past four years. In the first half of this year, it has added more than 2,000 new products. These channels originally sold some small and medium-sized brands or counterfeit household electrical appliances, and these products were used in home appliances to the countryside. Has been eliminated by the market, many successful home appliances to the countryside of small and medium-sized brands monthly sales even 0.

In addition to Haier’s daily channels, the layout of the US-based, Gree, Skyworth and other three or four markets has been completed. Wang Jinliang stated that “With the exit of home appliances to the countryside, the big brands have established a complete market channel, and their impact has been minimal. Instead, the small and medium-sized brands that have lost their previous channels will not have the opportunity to think about counterattacks."