LED channel construction should not be rushed

[Source: "High-tech LED-lighting market" July issue Zhou Jianhua finishing]

"The channel is king, the brave first." This sentence has been well verified in the development of traditional lighting companies for more than ten years, and many LED companies also embrace this principle to sprint channels. However, after two or three years of ups and downs, most of the channel construction of LED lighting companies has little or no effect. Why? Terminal acceptance is low and cost changes should be the main cause.

In terms of channel construction, we have been trying to take the channels of engineering, dealers, e-commerce, and designers. This year, we launched the LED business photo project. After the product line was gradually improved, we dared to test the water LED monopoly channel, and the pace was very cautious. First of all, it is expensive. Although only five specialty stores have been established in developed regions, the initial investment has reached more than 8 million yuan. Secondly, the scale effect of the commercial photo that has just been launched has not yet formed, and other systems need to be gradually improved. And if you hold the purpose of building a family and succeeding in a family, the speed cannot be accelerated blindly.

In fact, the LED channel is not inscrutable. Like the traditional lighting field, the current LED lighting channels can also be divided into: engineering (invisible) channels and circulation (distribution) channels. Most of the customers in the engineering channel are the government, hotels, villas, etc. The enterprises often play the role of “integrated service providers”, and need to coordinate the relationship between engineers, designers, construction companies, etc., and follow up the whole process.

The shortcomings of this model are the fragmentation of the project and the long period of capital withdrawal. Distribution channels need to use partners such as distribution, agency, and franchise to achieve full control of end customers. The advantage of this model is that it can quickly lay out and realize the “flowering everywhere” of the product network and quickly occupy the consumer field. The disadvantage is that the dealer's profitability and loyalty can not be controlled. If there is not enough tempting investment promotion policy, or if the profit is not realized in the short-term after joining, it is common for dealers to evacuate or counterattack.

At present, LED companies have lack of experience in channel construction, low recognition, low types, high prices, merchants are also unfamiliar with LED product technology, brand loyalty is not high, and after-sales service system has not yet formed a series of short board. Therefore, I believe that LED channel construction should not be rushed, otherwise the speed will not be reached.

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