Chapter 99 The Beginning of the Home Appliance War
After the news of the press conference jointly held by Li Yuhang and Chen Weirong, countless heads of household appliance manufacturing companies and bosses cursed. They knew very well that price cuts were inevitable, and this was simply poaching their flesh.
Changhong even enjoyed the condolences from countless people. The calls one after another made the scalp of Changhong’s senior management go numb, and Chen Weirong was considered crazy by the industry after this incident.
Decades later, when talking about the home appliance war in the 1990s, there were two important symbols, which were also the triggers for the national home appliance war.
The first is Changhong’s substantial price reduction on November 10, and the second is the strategic partnership between Jianan Supermarket Group and Kangjia Electric Appliances on the 15th of the same month.
This home appliance war lasted for three years, leading to the defeat of numerous imported color TV brands and accelerating the bankruptcy of small domestic brands. Seven major color TV leaders were formed: Kangjia, TCL, Chuangwei, Changhong, Haier, Hisense and Jinque.
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In the end, seven major leaders formed an alliance to protect the interests of manufacturers, and the war was ended.
The price war was so brutal that it exceeded everyone's imagination. In the later stages of the price war, some manufacturers even supplied products at cost prices or even at a loss.
At present, no one expects that it will be so miserable in the future. After Jianan Supermarket and Kangjia Electrical Appliances reached a strategic partnership, those previous partners also understood that the situation was about to get out of control, and contacted Jianan Supermarket and Lingjiang Electrical Appliances Chain Company one after another to start a large-scale
Although the intensity of price cuts varies, it has become a foregone conclusion that the prices of major electrical appliances will collectively plummet.
This has also greatly promoted the sales of home appliances. In the past, my family was not well-off, and I still wanted to save a little more money to buy it. Now after the big price reduction, I found that I already had enough money, so I took advantage of this wave of price reductions to buy my favorite home appliances.
The manufacturer suffered the biggest losses in this incident. As a channel distributor, Jianan Supermarket Group made a little less profit from one home appliance, but after sales increased, its profit was greater than before.
In order to speed up the expansion of Lingjiang Electrical Appliance Chain Company, Li Yuhang once again injected 5 million into it. In addition to the 20 branches being renovated, Lingjiang Electrical Appliance Chain Company once again added 20 branches, and these 20 stores will enter the mainland of the province.
level city.
As for the county town, those who have Jianan Supermarket will not enter for the time being, and those who do not have Jianan Supermarket will enter.
At the general manager's office meeting of Changhong Home Appliances Company, the general manager Ni Runfeng shouted angrily at Zhou Yibo who was standing opposite: "You said that Jianan Supermarket Group is bowing its head. You also said that the price will be adjusted back in just one week. Tell me now.
How can we bring the price back?”
Changhong has never thought about starting a price war. This guy is not only harmful to others but also to himself. He just wanted to teach Li Yuhang a lesson and let him know that Changhong is not something he can control.
It turned out to be good now, when I met a lunatic like Chen Weirong, who actually found an excuse to start a price war.
And Li Yuhang is also a fool. He also promised to sell similar products with the lowest price. He has no intention of bringing the price back, so he just sticks to the current price.
The worst luck is that colleagues all blame him for starting the price war, no matter how much he explains, it's useless.
All parties have grasped one thing, that is, this sale is not a big promotion, and no specific time has been given. It is a real direct price reduction.
This made Changhong the first to break the rules and was targeted by the same industry.
And all of this stemmed from Zhou Yibo's proposal, not in the name of promotional activities, not sure of the specific time, just to force Jianan Supermarket to bow its head.
They even said hello to many colleagues, but unfortunately they met this guy Chen Weirong, which completely ruined their plan.
It is even self-defeating, causing the sales price of color TVs to drop a level lower. You can now buy a 25-inch one for the price of a 23-inch one.
In the end, all losses will be paid by the manufacturer, and the interests of the channel dealers will not be reduced. I am afraid that the channel dealers will become stronger as we go further. Anyway, there are more than one. If you don’t offer the same price, there will be another manufacturing company.
supply.
Zhou Yibo stood here and listened to Ni Runfeng's angry shouts without daring to breathe. He knew that the last chance to save his career and official career was gone.
This time there is such a big problem. At best, I can retire in a vacant seat, but at worst, I am afraid I will be fired and held accountable.
Seeing Zhou Yibo lowering his head without saying a word, Ni Runfeng became even more furious. He was now at the forefront of the storm. I don't know how many people bluntly said that he was incompetent and should not sit in this position.
After this incident, Changhong's profits will inevitably decrease significantly. If the market cannot be increased as soon as possible, he may have no choice but to leave Changhong.
"Zhou Yibo, because some of your problems have caused huge problems in the development of our company, you will temporarily hand over the work to Deputy Manager Zhang and wait for follow-up arrangements."
Zhou Yibo did not argue anything. There must be a scapegoat for this matter, and as the proposer of these events, he is undoubtedly the most suitable.
Although he can shirk that it was the collective decision-making of the company's board of directors, that will not allow him to escape punishment. It is better to be like this now, when Ni Runfeng and others can still put in a few good words for him.
After Zhou Yibo left, Ni Runfeng calmed down and began to think about Changhong's next development.
If the company's profits are not to decline, relying solely on the provincial Hongqi chain, New Four Seasons Supermarket, Zhuhai Supermarket and Guocheng Supermarket is not enough.
Changhong must open up more channels and markets. Currently, the major retail giants that have achieved scale are Zhongbai, Huarun, Hualian, and Parknshop Supermarket. Ni Runfeng needs to establish strategic cooperative relationships with them so that he can make a comeback.
Chance.
As a strong man of the generation, Ni Runfeng did not indulge in regrets. He made phone calls one after another, contacting one boss after another and asking when the other boss would be free. He would personally visit the boss to discuss cooperation matters with them.
Kangjia, a brand that has not yet been launched in Sichuan and Sichuan provinces, has been known to countless people through a press conference. The sales of Chenben, the lowest in the country with the same quality and configuration, have attracted the attention of countless consumers, and many consumers are interested in buying color TVs.
People are waiting for the launch of Kangjia color TV.
At the same time, some small TV brands in the province were severely hit. The low-price sales of big brands directly led to the loss of the market for their products. Changhong's price reduction, Jianan Supermarket and Lingjiang Electric immediately followed up, and with the entry of Kangjia,
It completely disrupted the original balance of the home appliance market in Sichuan and Sichuan Province.
For example, the CEO of Jinque Color TV in Yuzhou has not been able to sleep well in the past few days. Life has been difficult in the past two years, and he can barely survive by surviving in the cracks.
Now that big brands are cutting prices one after another, and products with the same configuration are priced the same or even lower than theirs, who will buy their products?
He seemed to be able to see the near future of Jinque Color TV Company, and this incident was the last straw that broke Jinque Color TV Company's mind.
There are many companies in the same situation as Jinque Color TV Company, such as Chengdu TV Manufacturing Company, which is not much better than Jinque Company.
This is just Sichuan and Sichuan Province. As the trend continues, many companies in other provinces such as Jinque Color TV Company and Chengcheng TV Manufacturing Company were either acquired or went bankrupt.
This is a historical necessity. Li Yuhang's arrival only promoted the price war in the home appliance industry in advance. Without his arrival, the price war would have also started, but only later.