On September 9, Midea Group and Little Swan A both announced the suspension of the reorganization announcement; on September 24, the two sides announced again that they will disclose the relevant plans for asset restructuring on September 28.
In fact, the industry has already had many speculations. Some experts believe that this asset restructuring may be the US wants to privatize Little Swan, and then promote the integration reform of the group. Another insider believes that the US may be in the washing machine. The market continues to exert strength and truly seize the right to speak and take the initiative.
The author believes that the reorganization of the beautiful Little Swan may be the original intention of spurring more share in the washing machine market and enhancing the brand value. But the reality may be cruel, such as the beauty, the little swan's own problems, restructuring Factors such as heavy fog and intensified market competition will bring many challenges to the restructuring, and even make the US's layout in the washing machine market 'bankrupt'.
Market competition is inferior, beautiful helpless restructuring
In the past ten years, through mergers and acquisitions, Midea Group has a large number of home appliance brands, why the US group chose to reorganize with Little Swan instead of 'others'. The author boldly speculated that this may be directly related to the desire of the United States to strengthen its own strategic layout of the washing machine market. After all, from a business perspective, Little Swan differs from the parent company's Midea Group in its diversification strategy. More than 90% of its revenue comes from the category of washing machines. Therefore, the beauty is actually targeting the washing machine.
But it is undeniable that, whether it is beautiful, or Little Swan, the current performance in the washing machine market is not satisfactory.
First, according to Zhongyikang retail data, in the first half of 2018, Little Swan's radical price increase to mid-to-high-end transformation, Haier regained its strength in the low-end and took some markets, and opened the US with 30% market share again. In the first half of this year, Little Swan's revenue growth dropped from 32% in 2017 to 14%, and Q2 growth rate was only 7%. Haier's washing machine business revenue growth rate in the first half of this year was 20%. %, far beyond the little swan.
Secondly, the United States also has to change in the washing machine market. It is understood that among the nine product divisions of Midea Group, the main brand of the United States is only in the weak position of the washing machine. At present, the sales volume of the US main brand washing machine only accounts for three-thirds of the group. First, even half of the Little Swan. In addition, according to the data of Zhongyikang, the price of the US washing machine in the first half of this year was mainly concentrated below 3,000 yuan, which is obviously not comparable with the Little Swan.
Midea and Little Swan have their own problems in the washing machine market. Therefore, strengthening the washing machine business through asset restructuring has become an inevitable measure. After all, compared with other competitive and incremental home appliances, the washing machine industry is now in In a benign market, there is still great potential to be tapped. Therefore, Midea wants to show a strong side in the washing machine market, and must cooperate with Little Swan to fully digest their respective advantages.
After the reorganization, I also encountered problems.
If the beautiful reorganization of the little swan is followed by a 1+1> 2 ability, it is naturally excellent. But the author believes that the current beauty and the little swan will still encounter problems after the reorganization, if these problems can not be solved, then the beauty is likely Will face more embarrassment.
First, Midea wants to complete the counterattack in the high-end market through Little Swan. But in fact, in the current consumption of washing machine upgrades, Little Swan's performance in the high-end market is more general.
At present, the penetration rate of drum washing machines is only 50%, and the market potential is huge. It has become the target of competition for washing machine enterprises. In addition, dryers, washing and drying, air washing, intelligent washing have become the focus of differentiated competition in the washing machine market.
However, compared with Haier, Little Swan is weak in high-end products. According to Zhongyikang data, in the high-end product range of more than 3,500 yuan in the washing machine market, the US department has a 35.6% market share, which is 22% lower than Haier. In response to market pressure, Little Swan changed 8 of the country's 35 central managers in August this year, and Little Swan said at the performance exchange meeting that the product switching in the adjustment period will take one to two quarters to complete. It seems that Little Swan has Because of the unfavorable situation in the high-end market, there has been turmoil.
Secondly, the development of various business units of the Midea Group has been different, and the sales models are different. For example, each business unit has its own KPI to complete, it is difficult to form a coordinated operation. In the past, there has not been a real move in the past. At present, the categories of the Midea Group are more severely separated, and the terminal retail efficiency needs to be further optimized and improved.
In the case of the respective divisions of the divisions, how can the US and the Little Swan reinforce the washing machine business to obtain more empowerment and assistance? If the washing machine products are still alone in the market, then the competitiveness of the US will not be obtained. Essential improvement.
Overall, the lack of competition in high-end washing machine products, the lack of terminal retail synergy capabilities, etc., will be the next step in the US washing machine market. It is particularly noteworthy that Midea’s competitors in the washing machine market are foreign brands and established brands. Giant Haier. If you can't really come up with a practical strategy, the development after the reorganization will be very difficult.
For the time being, after the reorganization of Midea and Little Swan, they should still focus on their respective market segments. If Midea is still focused on the low-end market, Little Swan will launch a fierce impact on the high-end market. That is, Little Swan takes High-end quality products go 'strong' and establish a good brand image; Midea will use the medium and low-end products to 'bigen' the scale and continue to seize more market share. Under the two-pronged strategy, the two sides are likely to be comprehensive. Huanxin.
The changes in the home appliance market can be described as ever-changing. If you can't adjust the heading of the company in time according to the market trend, you may be hit hard. The US clearly sees this in depth, so it has made a big move with the asset reorganization of Little Swan. But the assets Reorganization is not a panacea, but in the final analysis depends on what strategies and means will be adopted after the reorganization.
Since Midea and Little Swan are in a weak position in the washing machine market, if they want to stage a counter-attack drama, they must really achieve this through organizational structure, product innovation, etc. Otherwise, the competitors will not be indifferent. .