1. The industry grows steadily, with low concentration and wide space
The domestic home textile industry has grown steadily overall with a low overall concentration. . In 2016, the national textile industry market reached 203.6 billion yuan, and it will maintain a growth rate of about 5% in the future. By 2021, the market size will reach 258.7 billion yuan. According to the industry leading figures, in 2016, the household income of Rollei was 3.15 billion yuan, that of Fu Anna was 2.31 billion yuan, and that of Mercury was 1.98 billion yuan. Domestic textile enterprises had been unable to break through the 4 billion yuan scale, and the degree of concentration was low.
The low concentration of home textile industry is mainly due to the following factors: 1) Higher industry profits and lower barriers: From the perspective of market participants, raw material suppliers, midstream manufacturers, and downstream distributors can enter the market one after another. , resulting in full competition in the industry; 2) Product brand segmentation is not enough: compared to the apparel industry, the brand identity of home textile products is not strong, the public consumption is still stuck in functional product consumption, brand philosophy is still under construction. As a result, home textile brands are mostly regional brands, and local brands enjoy the advantage of channels to occupy the local market and regional development is relatively difficult.
2. High growth of e-commerce business, helping to enhance the concentration of leading e-commerce
The development of e-commerce breaks the existing regional barriers and helps product sales across the region. The development of the e-commerce model has broken the sales network that was originally dominated by stores, franchised stores, and other physical stores. In 2010, the sales of e-commerce in the home market in China accounted for 0.5% of total sales. By 2016, the sales in China’s home market through e-commerce channels had reached 6.90%, showing a rapid growth trend. E-commerce sales in home textile companies The proportion of sales is increasing.
With the increase in the size of the company's e-commerce business, leading companies capture the market with cost-effectiveness and brand power, and the degree of concentration is expected to increase. 1) From the product side, leading companies launched online products and advocated the concept of cost-effectiveness: Rollei Life launched its online cost-effective brand LOVO; Mercury Home Textiles set up a dedicated R&D team for e-commerce channels to develop exclusive cost-effective products for online channels. 2) Cross-border cooperation has become a trend and enriched brand recognition: companies have launched various types of cross-border cooperation products and well-known IPs such as Disney and Kitty cats. 3) Judging from the development results: Taking the lead Luolai Home Textile as an example, since the launch of the online brand LOVO in 13 years, the e-commerce sector has developed rapidly, and the sales of the double 11 in the 14-17 year were 1.5/1.9/2.1/ 260 million yuan, compound growth rate of nearly 20%, higher than the industry-wide growth rate. Judging from the business situation of Mercury Home Textiles, e-commerce sales revenue increased from 360 million yuan in 2014 to 640 million yuan in 2016, with an average annual compound growth rate of 33.6%. In the first half of 2017, the sales revenue of e-commerce reached 410 million yuan, a year-on-year growth rate of 84.9%.
On the one hand, online sales have broken the barriers of the original region, while leading enterprises have gained market access through online exclusive products + ultimate cost-effectiveness + brand recognition, which has increased the turnover rate and increased the sales scale.
Online and offline integration into the trend. E-commerce channels promote the adjustment of the industry's sales structure, but offline channels are still the main source of profit for bedding companies. Online and offline channels are mutually integrated, which is the inevitable trend of future bedding business sales models. Therefore, in the future to strengthen e-commerce channel construction, we must also pay attention to the continued expansion of terminal stores and its "survival rate", online and offline together to actively change, innovation, and achieve omni-channel integration.
