Recognize the current general environment and situation of China's furniture industry

The downturn in the furniture industry this year has left many companies feeling "at a loss", especially the small and medium-sized enterprises with weak anti-risk capabilities are almost struggling on the edge of the life and death line. There are not a few, but it does not mean that the furniture industry will be down from now on. Any industry will experience difficulties and crises in the process of development and maturity. Companies only need to understand how to see the general situation and environment during the crisis. Follow the trend and not fall into adversity.

The overall environment and situation to be mentioned here seem to have no direct connection with the furniture industry. In fact, they are closely related. It is impossible for any industry to exist in isolation. There will always be upstream and downstream industrial chains, which will always be in a certain large economy surroundings. In this way, we will temporarily put the microscopic concrete forms of the furniture industry to take a look at the general environment and the general situation. Perhaps some of the furniture companies that are burned out can still find answers, and even find a way out.

First, there is no permanent "just need" in the real estate market

Recently, there has been some recovery in the US real estate market, but real estate risk is still considered to be one of the biggest risks of the US economic recovery. Since the subprime mortgage crisis, real estate market prices have fallen by more than 30%. This is not only because of the short-term distress of the negative effects of the market bubble burst, but also that the changes in the US population structure are having a profound impact on the long-term trend of real estate market demand and purchasing power.

The reason why the U.S. real estate market continues to decline is because of the "saturated demand" in the housing market, and the fundamental determinant of "saturated demand" is the change in the total population and population structure. Population changes include the impact of natural growth rates and immigration growth rates on housing demand. The Census Bureau released the latest figure of the US population of 308 million people. The population of the United States has grown 9.7% in the past decade, the lowest increase since 1940. From an incremental point of view, the US population growth mainly comes from immigration and immigration's birth rate, accounting for 82% of the increase in population.

On the other hand, changes in the population structure also determine the demand for housing. The decline in fertility and the acceleration of the aging population will not only cause a substantial decline in the total housing demand in the United States, but will also have a new impact on the structure of housing demand. Those “large units” that once promoted the prosperity of the U.S. housing market will appear to be unsalable .

It seems that the so-called "necessary demand" in the real estate market is only a staged concept, and the demographic dividend is not a permanent growth factor. The demographic structure affecting real estate demand and thus affecting real estate trends seems to be an inevitable "iron law". The data shows that the age structure of the global population will undergo tremendous changes. The growth rate of the youth population has slowed, and the growth rate of the elderly population has been alarming. By 2050, the global aging population will have tripled to 1.5 billion people.

According to United Nations data, China ’s demographic dividend will fall to the global average by 2025. According to statistics from the Statistics Bureau last year, the proportion of China's labor force has declined for the first time in ten years. Various signs indicate that the time point for the change of China's population structure is accelerating. Changes in the population structure will change the supply and demand structure of the real estate market. It is expected that China's population growth rate will enter a decline channel after 2015, and the population over 60 years old will reach 250 million by 2020. This time period will also be an important time window for the turning point of China's real estate supply and demand structure.

Second, the unstoppable tide of urbanization

Many people gather in a relatively small geographic space, and once it reaches a certain population density standard, the place is named "city". Taking a longer view to look at it, this trend of change is still increasing globally, and the tide of "urbanization" is unstoppable. Why do people like to join the city under the sky? The economic impetus looks straightforward-cities create higher incomes.

The population concentration of Greater Tokyo has long been impressive, with 25% of the population in a space that occupies only 4% of the entire area of ​​Japan. However, the economic concentration of the world ’s largest city is even worse: Tokyo ’s per capita GDP for the year was 72,000 US dollars, which was 67.4% higher than the national average of Japan. In this way, one place in Greater Tokyo accounts for 40% of Japan's total output. How about other big cities? According to statistics in 2004; Toronto has 13% of the population and 14.4% of the economy; London has 11.8% of the British population and 13.3% of the economy; New York City has 2.3% of the US population and 3.5% of the economy.

Evidence on a global scale shows that the logic of human economic activity is to gather in the flow, and then to flow and gather again until the population, economy and wealth are geographically concentrated in places of extremely small size. This is what "urbanization" originally meant. Economic density is higher than population density, and it must attract more people to gather. But with a large population, can the economic density be improved? not necessarily. The population of the South Korean capital accounted for 21% of the country in 2004, but the economy (GDP) only accounted for 20.7%. Reports for many years before said that Seoul was absorbing the resources of the whole country like a black hole, and even a city like Busan was experiencing "negative growth."

Population aggregation promotes economic aggregation, which in turn stimulates population aggregation. This is the dynamic process of urbanization. We can only say that, so far, global urbanization has shown no signs of stopping. When some cities stagnate and die, others rise vigorously; urbanization stops in one period, and urbanization stops in another period. There is only one joint point that we can grasp. This is whether economic agglomeration is higher than population agglomeration. If environmental, technological, institutional and conceptual conditions can sustain economic agglomeration beyond population agglomeration, we can safely infer that urbanization will continue. On the contrary, economic geography will be "flattened" again. The special feature of China is that the population gathering has long been unable to obtain the call and stimulation of a stronger economic gathering, so that it has not given due impetus to urbanization in a long historical period.

Third, why is the real economy so difficult?

Since mid-2011, people from all walks of life have begun to pay attention to the difficulties of the real economy. As the GDP growth rate dropped to 8.1% in the first quarter of this year, the problems of the real economy have become increasingly concerned. The external economic recovery is weak, and Europe is still facing a debt crisis, but after all, the business difficulties of the external economy in the context of the recovery are occurring. Therefore, insufficient external demand and external reasons should not be the main reasons for the real economic difficulties this time. Broadly speaking, these factors and the mechanisms that affect the real economy are:

First, the high taxes and fees and the monopoly of high prices on upstream products have increased the production costs of enterprises.

Second, the high housing prices hurt the real economy. The damage of high housing prices to the real economy comes from two aspects: first, in the process of asset bubbles, it is impossible for the real economy's rate of return to catch up with the rate of return in the asset market. In this way, the real estate economy will have a capital withdrawal effect. Secondly, high housing prices also directly increase the operating costs of enterprises.

Thirdly, inflation and RMB appreciation both squeeze the profit margins of export enterprises. The renminbi appreciates externally and is settled in local currency, and the sales price has dropped. What's more terrible is that the renminbi also depreciates internally, labor and raw material prices rise, and the profit margin of the export industry is greatly squeezed.

Fourth, the financial system is flawed and the cost of corporate financing is too high. The benchmark interest rate for loans stipulated by the state is 6%, which can fluctuate by 2 basis points. But in fact, enterprises not only have to bear a 6-8% loan interest rate, but also have to bear a discount rate of 7%, plus other financing costs, the actual financing cost of the company is about 16-18%. Not only that, it is difficult for the majority of SMEs to obtain financing from banks.

Fifth, the industrial structure needs to be adjusted, but the more advanced the industrial structure, the higher the requirements for the definition of property rights and the protection of the rule of law; the advanced industrial structure also requires higher human capital, but our education has not kept up ? Has vocational and technical education been kept up? It should be said that not keeping up is a big problem.

To sum up three points, after reading it, do you dare to say that this has nothing to do with the furniture industry? Maybe you have found the answer you want, and you already know the future development of the company.