Small Household Appliances, How to Be Small and Beautiful - Observation of Traditional Industries in Zhejiang, Part Three

On the hottest three dog days of the year, in the workshop of a household appliance enterprise in Cixi, the "hometown of small household appliances", the winter heating appliances have entered the production stage. A while ago, the "cooling appliances" sold from Cixi to the world had a burst of orders. In the first five months, the export amount of local air conditioners increased by 217% year-on-year.

In Cixi, from air conditioners and refrigerators to curly hair sticks, there is a complete supply chain and OEM factory, and even the assembly time unit of small household appliances can be shortened to "seconds".

However, the seemingly omnipotent Cixi small household appliances have been mainly produced through OEM for many years, which has the problems of strong assembly ability but weak intelligent manufacturing, excessive homogeneous competition but insufficient innovation, and numerous enterprises with weak independent brands.

How can small appliances become small and beautiful? The hundreds of billions of industries in small county cities urgently need to find a high-quality transformation and upgrading path.

Make intelligent manufacturing with valuable value

At present, most small home appliance enterprises in Cixi are busy with two things: rushing orders and intelligent transformation. The former is for survival, while the latter is for better survival in the future.

At Yueda Electronics, the lean team from GAC Toyota is discussing the details of the intelligent transformation of the production line. In the second half of last year, we hired a lean team from GAC Toyota to do the entire process of lean improvement, "said Yi Quan, the financial director of Yueda Electronics, with a few fingers pointing up

Yueda, which focuses on high-end steak machines and air fryers, has a strong dream of intelligent manufacturing. In the workshop, the slogan "One Stream Manufacturing" is particularly eye-catching. This is our dream, which means that everything from components to the entire machine is a production line. On the one hand, we can improve manufacturing efficiency and improve product quality, and on the other hand, we can reduce inventory. "Yi Quan said," We need to change the stereotypical impression of Cixi small household appliances being poorly made from the outside world

In the digital workshop of Ningbo Ruika Electric Appliances, the reporter saw that the components such as the motor, fan blade, and base were sequentially put into the assembly line by workers. Only a few seconds later, a complete blower supply component was produced. Zheng Shouxian, the deputy general manager of the company, told the reporter that this set of fully automatic air supply component production line was jointly built by the company and the Chinese Academy of Sciences.

In the year when the epidemic began, we began the intelligent transformation and it never stopped, "Zheng Shouxian said. In the past three years, the company has invested no less than 20 million yuan to achieve the intelligent transformation of the production workshop in the new factory area. It has been proven that storing energy during dormancy is a wise move. At the end of last year, the optimization and adjustment of epidemic prevention and control policies have been carried out until now. Among the new and old customers who visited the factory, 99% of them have confirmed their cooperation relationship or carried out closer cooperation, "she said.

At Cixi Cardia Electric Appliances Company, two new factories are being built according to the Industry 3.0 standard, with complete automation production and intelligent three-dimensional warehouses. The new factory will produce intelligent products and newly developed kitchen products, while the other will produce high-end seasonal products, "said Shen Ze, the company's general manager.

The future of manufacturing will definitely be precision manufacturing, "Shen Ze, who returned from studying at Imperial College of Technology in the UK, told reporters. Recently, at the Ningbo Hong Kong Forum held in Ningbo, an expert's words deeply inspired him. Although the small home appliance industry in Cixi may not necessarily be precision manufacturing, it must also move towards a more valuable path of intelligent manufacturing, "he said.

As of now, Cixi has achieved full coverage of intelligent transformation for household appliance enterprises above designated size, with 2 enterprises selected as provincial-level future factories and 20 enterprises selected as provincial-level digital workshops (intelligent factories).

Innovation cannot be stopped for a moment

Small household appliances all look similar, and in the current era of highly homogeneous products, how can we make our products outperform our peers?

The Ruika Electrical Exhibition Hall, designed by Zheng Shouxian, is filled with various company patents displayed on one wall. We haven't finished releasing it yet, "Zheng Shouxian firmly said." Even during the epidemic, we haven't stopped innovating our products and develop no fewer than five or six new products every month. So even though it's difficult to meet customers during the epidemic, the company can still gain customer favor, with a return order rate of up to 98%

In the product display area of Cartier Electric, Shen Ze spared no effort to explain to reporters the company's "careful thinking" in design. "This water filled air conditioning fan has improved the user experience to a higher level, and the enclosed heater makes the heating more uniform

In Shen Ze's view, if a company wants to break free from the quagmire of low-quality competition, it must become the "person who can always eat crabs". In recent years, Cartier has been eating "crabs" in new products such as baseboard heaters, water tower fans, and industrial fans. Currently, Cartier can launch dozens of new products for both summer and winter every year. When there is great downward pressure on the economy, there will definitely be an industry reshuffle. To survive, one must practice internal skills, "Shen Ze said.

Yi Quan told reporters that in 2021, the company decided to proactively abandon its low-quality and low-priced product line and strive to create a new high value-added production line. However, the company encountered significant operational difficulties that year, and overall revenue decreased by nearly 40%. If we don't consistently hit the mid to high end, the competition the company faces will only become more intense and the profits will be lower. In this vicious cycle, we cannot survive for a long time. "Yi Quan said, after two years of continuous pain, the effect began to show last year, and the company's output value exceeded 1 billion yuan for the first time.

Those who have deep internal skills have a strong foundation and external strength. It is said that global demand is shrinking, but even if a ten inch cake turns into a six inch cake, the key is how much you can get. "Zheng Shouxian said that the company's export volume increased by 50% year-on-year in the first half of this year. Shen Ze also revealed that the company's goal for the second half of the year will be a bit more "aggressive", which is to find ways to occupy a larger market share.

Seize brand opportunities in expanding consumption

Among the 45 national advanced manufacturing clusters announced by the Ministry of Industry and Information Technology, Guangdong Guangfo Hui Ultra High Definition Video and Smart Home Appliance Cluster and Shandong Qingdao Smart Home Appliance Cluster are the two major smart home appliance clusters in China. The former has Gree and Midea, while the latter has Haier and Hisense.

In contrast, Cixi's small household appliances have a small scale and few brands, and there is no brand that can compete with the top two clusters. It can be said that the lack of brands has become a "roadblock" for the high-quality development of small household appliances in Cixi.

When the reporter asked Zheng Shouxian what was the biggest difference between making a hair dryer and Dyson. Brand, "Zheng Shouxian replied bluntly. Incubating a household appliance brand in Cixi is both the government's expectation and the dream of leading enterprises, "Shen Ze said, expressing the industry's aspirations.

Pursuing a dream brand is not an easy task. Over the years, there have been many attempts in Cixi, but there have been few successful ones. Now, the situation is changing. From the perspective of the external macro environment, the country is vigorously boosting consumption, such as the National Development and Reform Commission's recent "Measures on Restoring and Expanding Consumption", which includes 20 dry goods measures to boost consumption. At this time, catering to or even leading domestic consumer demand is a great opportunity for small home appliance enterprises that are deeply engaged in segmented fields to establish their brands. When the innovation ability, manufacturing ability, and product quality of Cixi small household appliances are all working together and improving one after another, it also injects confidence into the path of a good brand.

Like the Bull Group, following the trend of intelligent IoT technology development, in March this year, it launched a new brand without main lights, "Mu Guang," to compete on the new track. Yueli Group, which has been working as a hair dryer OEM for many years, has targeted the post-95 generation and established its own brand "Xiaoshi", successfully occupying the Chinese young consumer market. Yue Lizheng is concentrating resources to build "Xiaoshi" into the top brand in the domestic personal care industry, striving to account for over 50% of the company's domestic sales by 2025.

Currently, Cixi is planning to build a global smart home appliance highland, introducing the "Action Plan for Building a Global Smart Home Appliance Innovation Center in Cixi City", creating a Cixi Smart Home Appliance Innovation Design Center and E-commerce Park, introducing the construction of Xiaomi Ecological Chain Digital Economy (Cixi) Industrial Park, and shaping a batch of new e-commerce brands in Cixi.

A journey of a thousand miles begins with a single step, climbing upwards and moving forward courageously. We wait and see, the small home appliance industry in Cixi, which borrows strength from "intelligence", strives for victory with "innovation", and pursues a dream brand, will steadily and far on the small and beautiful road.