Many furniture factories in Shenzhen have closed down real estate upstream and downstream enterprises in difficult situation

Xinhuanet Guangzhou, September 26th Recently, Shenzhen furniture company Huaren Industrial Company posted a notice on the door of its factory and declared its collapse. Since June this year, many furniture companies such as Huayuanxuan and Fuzhidao have experienced financial crisis in Shenzhen. Some real estate upstream and downstream enterprises are in a difficult situation. The industry believes that in the context of the uncertain future of the real estate market, the upstream and downstream industries need to transform through the “difficult years”.

On September 9, 2014, Shenzhen Huaren Industrial Co., the parent company of the well-known brand “Bailan Mattress”, posted a notice on the door of its factory and declared its collapse. According to the notice, due to the current sluggish real estate industry, furniture companies are in a difficult situation and are affected by many factors. Huaren Company has suffered serious losses due to poor management and management, and can only choose to suspend business. Xianghe Furniture City

Since June this year, Shenzhen has experienced furniture crisis. On June 11, 2014, a Weibo certified user named “Liangyan 2014” released a message saying: “The Shenzhen furniture brand Huayuanxuan was blocked, and the supply chain break is applying for bankruptcy.”

More media reports revealed that Huayuanxuan had withdrawn a large amount of funds due to the failure of the second listing, resulting in a break in its supply chain. Subsequently, Hua Yuanxuan denied the bankruptcy, but admitted that there is indeed a "financial dilemma."

Almost at the same time, Fuzhidao Furniture, which was ranked in the forefront of the Shenzhen furniture industry, also reported that its production line workers had stopped working due to arrears of about 10 million yuan in wages. Xianghe Furniture City

Insiders pointed out that the continued downturn in the furniture industry is not unrelated to the downside of real estate. "From the perspective of the economic situation, as the downstream industry of the real estate industry, the impact of the home production industry is the first to bear the brunt," said Jiang Hongyuan, president of the Zhejiang Furniture Association.

However, he also believes that the current development of some furniture companies across the industry is likely to lead to problems in the capital situation. At the same time, the industry also has problems of blind expansion and overcapacity. Zhao Ruihai, president of Qumei Furniture Group, said that the real estate industry is an upstream industry, which will inevitably have a certain impact on the furniture industry. He believes that the correlation degree is around 40%-50%.

Recently, with the release of real estate “restriction purchase” orders in some areas, the real estate market environment is expected to pick up, but at the same time, the upstream and downstream industries such as furniture will still face shocks.

However, it remains to be seen whether the upstream and downstream industries such as furniture can benefit rapidly. Some insiders believe that the sluggishness of the furniture market cannot be attributed to restrictions on purchases, and more is affected by real estate, finance and the big economic environment.

Since the external demand in the real estate industry is weak, and it is difficult to improve in a short period of time, the furniture industry can only make efforts in internal cost control and seek to transform into e-commerce in terms of business models and marketing channels.

The industry believes that the traditional sales model of the furniture industry is that manufacturers - national agents - provincial agents - municipal agents - consumers, higher costs, the final terminal pricing is higher. At present, with the rise of e-commerce, the traditional furniture industry should use the network to promote products, reduce the cost of middlemen, and find new profit growth points to tide over the difficulties. Xianghe Furniture City