Seize the opportunity to win the trillion yuan old house renovation market and upgrade home decoration consumption
2024-07-25
Replacing aging kitchen appliances, knocking off outdated yellowed floor tiles, and applying clean wall paint... Ms. Chen and her family, who live in Changsha, finally bid farewell to their dull and dusty old house and welcomed a bright and comfortable new home. Currently, there are more and more people with the same home decoration experience as Ms. Chen. With the real estate industry entering the era of stock, the replacement of home decoration consumer goods is becoming increasingly prosperous. After the State Council released the "Action Plan for Promoting Large scale Equipment Renewal and Consumer Goods Trade in" (hereinafter referred to as the "Action Plan"), many places have successively implemented the action of exchanging old for new home decoration consumer goods, improving residents' living comfort and happiness, and leveraging the home decoration industry to move towards a wider track. Multiple regions have issued policies to support the replacement of consumer goods for home decoration. On the one hand, substantial financial subsidies will be combined with supporting strategies launched by enterprises. On the other hand, efforts will be made to accelerate the treatment and utilization of solid waste generated during home decoration replacement Qin Zhanxue, President of the China Building Materials Circulation Association, told reporters that relevant enterprises should further produce green and environmentally friendly intelligent products that are suitable for the trend of consumer upgrading, and further explore the potential of the home decoration and home furnishing industry through trade in. Recently, a reporter from Securities Daily learned through multiple visits and research that the main body of the home decoration consumption industry chain is accelerating its capture of the old house renovation market, improving the full process service of home decoration, laying out a new track for green recycling business, and opening up the consumption upgrade path of the entire industry chain of home decoration industry. Since the release of the "Action Plan" in March this year, many regions have successively introduced policies to support the replacement of home decoration consumer goods and stimulate residents' consumption potential. For example, Beijing provides a purchase subsidy of 10% of the new product sales price after adding all discount discounts to eligible home furnishings for "renewal"; Various regions in Anhui provide individual consumers who purchase green smart home products with a maximum subsidy of 10% of the sales price through consumption vouchers. In addition, many regions also encourage financial institutions to provide financial support such as interest rate discounts and payment discounts. Since the end of June, Securities Daily reporters have visited multiple home decoration stores in Beijing and found that many of them prominently display colorful "trade in" posters. A salesperson from a shopping mall told reporters that currently, consumers participating in the event can receive two discounts. The first discount is the purchase subsidy from the Beijing Municipal Bureau of Commerce, and the second discount is the consumption voucher provided by the store. You can participate in the activity by registering your old furniture information online, and there is also a free on-site recycling service for old items. During the visit, Securities Daily learned that with the support of government departments, various enterprises are building experience centers for aging friendly home products based on the actual market environment in different regions. At the same time, they are participating in activities such as "trade in communities", continuously expanding the radiation of trade in, and accelerating the establishment of a specialized and one-stop trade in service system. A person in charge of a leading home decoration store told Securities Daily reporters that they have reached cooperation agreements with 15 companies including Midea Group and Boss Electric, and will continue to promote the trade in activity throughout the year. Many of the cooperation has achieved initial results, and some companies can complete more than 2000 home appliance orders per month for a single category. Taking advantage of the opportunity of exchanging old for new, enterprises in the home decoration sub sectors such as cabinets and bathrooms have also invested funds to provide subsidies, extend their business reach, and seize the market. In the eyes of many industry insiders, in the face of the more dispersed decoration demand in the era of existing housing, home decoration enterprises have coincidentally aimed at exchanging old for new markets, investing real money and silver subsidies, and proactively laying out products and channels, with the intention of winning opportunities and a larger market share in the game of existing housing. In recent years, the proportion of second-hand housing transactions to the total housing transactions in China has continued to rise, aiming to break through bottlenecks and seize the market. The gradual entry of housing transactions into the era of stock is the trend, and under its influence, the home decoration market will also undergo a profound transformation. According to the "China Home Decoration Development Report No.1", it is predicted that the overall size of China's home decoration market will reach around 5 trillion yuan by 2025, of which the size of the existing housing decoration market is expected to reach 3.34 trillion yuan. The consumption demand for old housing renovation driven by second-hand and existing housing will continue to rise. The potential of exchanging old for new home decoration consumer goods in the old house renovation market is undoubtedly enormous, but there are also many difficulties and bottlenecks. Yan Jinqiang, the head of the Better Life Research Center at Beike Research Institute, told reporters that the characteristics of home decoration consumption are low frequency, non-standard, long cycle, and high unit price, which determines that consumers have a long decision-making cycle and strong awareness of consumer safety. Home decoration consumption is not just about purchasing products, but also includes many process nodes such as "home" design and delivery. Currently, the supply of trade in services is insufficient, and the reputation of products and services is uneven, resulting in a mismatch between demand and supply. How to overcome obstacles tests the wisdom of home decoration enterprises. Providing one-stop services and strengthening the co construction and integration of the old for new service ecosystem is a breakthrough move. In the view of Zheng Shanshan, Deputy Secretary General of the Furniture Decoration Industry Chamber of Commerce of the All China Federation of Industry and Commerce, in the long run, leading home decoration enterprises should start with the consumer shopping experience, provide one-stop services from design, procurement to installation, and after-sales, which is the key to making consumers feel at ease when making purchases. The relevant person in charge of Haier Smart Home told Securities Daily reporters that with the trend of complete decoration becoming a major trend in the market, home decoration enterprises and component enterprises need to find a long-term and deep cooperation link, and also establish a collaborative relationship from the demand side, design side to the production side. Trade in is a long-term systematic project, and to truly activate demand, it is necessary to integrate the industry from a long-term perspective Zhu Jiagui, Executive President of Red Star Macalline Home Furnishings Group, told Securities Daily reporters that joint investment of resources, strengthening technological innovation and market promotion, can form a new ecosystem of "platform side+brand side+distributor+consumer" benign interaction among all parties. Smart homes are helping the industry upgrade. Innovative home decoration products represented by smart homes are becoming a key force in clearing bottlenecks, which will effectively stimulate consumers' willingness to trade in old for new and assist the transformation and upgrading of the home decoration industry. Post-2000s Xiao Yang (pseudonym) is a pioneer in whole house intelligent decoration solutions. Entering his new home, one can control devices such as lighting, television, air conditioning, and drying racks through voice commands. He told reporters that when he goes out, the robotic vacuum cleaner will automatically clean at home, and he plans to replace his parents' home with smart devices in the near future. Having gone through the 1.0 'functional' era of pursuing the size and practicality of homes, and the 2.0 'beauty' era of pursuing soft decoration to express personality and tone, we have now reached the 3.0 stage, which is the 'intelligent' era Shao Yang, President of Huawei Terminal Co., Ltd.'s Whole House Intelligent Product Line, told Securities Daily reporters. To accurately support smart home consumption, policies have taken the lead. Currently, many regions have provided financial subsidies for such consumption. For example, Hubei has included products such as dishwashers and floor scrubbers, which represent new trends in daily consumption, in the subsidy scope. With the development and iteration of many new technologies such as IoT, big data, AI, and robots, the smart home industry will accelerate its growth. Many companies have benefited from this business and entered the upward performance channel. Based on the recent first half performance released by related companies, many enterprises such as Haiou Zhugong and Shentianma A attribute their performance growth to the development of the smart home business sector. In addition, giants such as Xiaomi, Huawei, Midea Group, and Haier Smart Home are increasing their layout efforts. Jianlang Hardware and other home furnishing listed companies have also raised funds to increase investment in intelligent products. At the same time, some companies such as Hansang Technology have focused on the production line of smart home related products as their main investment in fundraising during their rush to go public. Whole house intelligence will inevitably become a key anchor point for 'good houses' Shao Yang stated that in the future, connection technologies such as PLC and Starflash, interactive technologies such as AI sensing and large model voice, as well as ecological platform technologies such as HarmonyOS, are expected to inject new development momentum into the whole house intelligence industry and real estate industry. (New Society)
Edit：Xiong Dafei Responsible editor：Li Xiang
Source：China.org.cn
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