The secret behind LED industry chain competition

Since ancient times, there has been a saying of natural selection and survival of the fittest. Today's lighting industry has long been no longer in a simple stage of product competition, but has risen to the level of industrial chain competition. Channel providers and application companies have the same confusion: How to Do LED? As we all know, there is an essential difference between product chain and industrial chain: the core of product chain competition is product integration, and the advantage is reflected in the total cost. The core of the competition in the industrial chain is demand response, and the advantage is reflected in the total value. From the perspective of long-term development, the latter is more competitive. Because the competition in the product chain is based on a certain enterprise and realizes the integration of products. The competition of the industrial chain is based on cooperation, and the whole industrial chain jointly completes the response to the demand. Mr. Wu said that the division of the industrial chain requires that the function and value transfer between each level must be efficient, coordinated and consistent in order to realize the value of the whole industry. There is no coordination between the top and bottom of the industrial chain, and competitiveness has no real significance. The upper and middle reaches of the industrial chain cannot quickly and effectively convert technological achievements into production capacity, resulting in unpredictable changes in technology and costs in the upper and middle reaches of the downstream. However, the upper and middle reaches lack understanding of changes in downstream demand, resulting in lagging innovation. Such a vicious circle has caused the downstream to be unable to accurately keep up with the pace of changes in technology, cost and demand, which has led to the concern of the channel providers, Conservative orders, and dare not make a large inventory plan. The upper, middle and lower reaches are fighting each other, the enterprise's ability to resist risks is declining, and the channel providers are in a wait-and-see attitude, resulting in the application-side Enterprise's response to consumer demand being unable to be fast and efficient. Therefore, there are a large number of inconsistent states such as technology, information and interest behavior differences in each link of the industrial chain, which affect the competitiveness of members of the entire industrial chain. Application-side enterprises and channel providers work together to build a strong industrial chain competitiveness. Channel providers play a very important role in the entire LED industrial chain and are the link to realize the value of the industrial chain, it has a direct feeling for consumers' needs, but Channel providers are also weak links in the whole industrial chain in controlling technology, cost and management. Application-side enterprises have the advantage of being close to and closely related to channel providers, and play a connecting role in the whole industrial chain. Therefore, the collaboration between application-side enterprises and distributors is the key to the consistency of the entire industrial chain. How to achieve vendor synergy? Wu Zheng, general manager of Yiguang lighting? He said that synergy is a mechanism and a mode that can generate competitiveness. In the initial stage of seeking cooperation, manufacturers should have a sense of identity with the corporate culture, including brand positioning, product positioning, career vision, goals, interests, etc. Moreover, the understanding of competition methods should be consistent, such as business strategy priority, operation mode, how the enterprise develops and so on. In the later period, it is required to clarify their respective responsibilities and obligations, and to go all out to undertake, to understand each other in the process of continuous communication, and to seek common ground while reserving differences and seeking common ground while reserving small differences. A single enterprise's competitiveness is difficult to resist the risks brought by the industry's malaise. The application-side enterprises can see clearly the division of labor in the industrial chain and the direction of development to reach a long-term consensus on cooperation, strengthen individual competitiveness and ability to resist risks. Case: Yiguang joined hands with channel providers to strategically lay out the industrial chain. As the leader of Taiwan's LED packaging industry, Yiguang Solid-State Lighting Co. , Ltd. was established in 2012. With its own advantageous resources in the packaging field, it will create a competitive advantage for lighting applications. Under the leadership of general manager Wu in 2014, the Yiguang lighting team highly interacted with the channel providers and established a close strategic partnership. The 19 operation leaders of Yiguang LED lighting mainland have learned the strategic height, comprehensive strength and management level of Yiguang in the whole LED industry chain through on-the-spot investigation of Yiguang headquarters, more recognition of the Yiguang brand, more confidence in the Yiguang brand. Mr. Wu said that the core of the Yiguang layout industry chain is to let dealers participate in the operation of Yiguang, to play a sense of ownership, to let them fully express their opinions and put forward their needs, and to grow together with operators. With a sense of security, channel providers can achieve long-term cooperation and achieve win-win results.