Jingzhou: Stability rises, turning point is hard to find
In the 1980s and 1990s, the market economy wave swept across the country, and a group of people ventured into the sea to do business. In the inland city of Hubei, Jingzhou City, gradually appeared merchants specializing in the sale of furniture, they were engaged in the sale of furniture in leased stores in the city, distributed in all corners of the city. This model has produced a group of millionaires, and most of the current furniture dealers have started their businesses since then.
With the development of the industry and the needs of the market, in 2001, the first dedicated furniture mall appeared in Jingzhou City ----- creating a home square, a group of furniture dealers entered the mall, and operated independently under the unified operation of the mall. A monthly rent is paid to the mall, which also opens the era of "professional home stores" and "specialized stores" in the Jingzhou furniture industry. Subsequently, professional furniture stores such as White Swan Furniture Plaza, Rant International Furniture City, Tianhong Furniture City, One Stop Full-Furniture Supermarket, and Yimei Furniture Plaza appeared one after another, and more dealers and brands poured into the furniture industry. More and more come, the competition is more and more fierce, and the profit is getting lower and lower. The word "rent", which can be ignored by furniture dealers, is frequently mentioned by dealers, and even became the last to overwhelm some dealers. A straw.
Rents have risen steadily but are still low overall
"The rent level of our home stores in Jingzhou is low in the prefecture-level cities in the whole province and even the country." Liu Xuesong, the leading enterprise in Jingzhou home furnishing industry and the general manager of White Swan Home Plaza, said that the rent has only been raised three times in the past ten years . In 2007, the square gold store was raised by 3 yuan per square meter, and the average store was increased by 2 yuan per square meter; in 2009, all stores were unified by 2 yuan per square meter; last year, the unified increase of 5 yuan per square meter was also the highest increase in history. Now, the highest rent for White Swan Home Plaza is 43 yuan per square meter, the lowest is 18 yuan per square meter, and the average is 35 yuan.
The rent of Blue International Furniture City has also been raised three times so far, with the highest increase of 8 yuan per square meter. At present, the highest is 45 yuan per square meter, the lowest is 10 yuan; Tianhong Furniture City has an operating area of ​​less than 10,000 square meters, the number of operations is relatively small, the grade is low, and the average rent is 30 yuan per square meter; Yimeijia Home Plaza per square meter It is about 20 yuan; the average price of a one-stop full-furniture parity supermarket is also about 20 yuan; the co-creation of the home square is all owned by the owner.
In the past ten years, the rent level of the Jingzhou furniture market has been steadily increasing. These home furnishing stores seem to have formed a kind of tacit agreement, as long as one increases the rent, the others will also increase accordingly. In addition to the rent reduction in these stores due to the impact of the financial turmoil in 2008, each home store will be adjusted up every two or three years.
It is reported that the total area of ​​furniture stores in Jingzhou City is about 70,000 square meters, and there are nearly 200 dealers. The supply and demand relationship has basically maintained a balance. The rent level of the stores is at an overall low level in the second-tier cities of the province and even the country. In Yichang, Jingmen, Xiangyang, Qianjiang and other cities adjacent to Jingzhou, the overall rent level is higher than that in Jingzhou. The gold store in Yichang reached nearly 100 yuan per square meter, and Jingmen also reached about 80 yuan.
Commercial value and supply-demand relationship determine the rent level
Why are the rent levels of furniture stores so different in the same second-tier cities? Shan Xiaodong, executive director of Jingzhou Furniture Association and general manager of Jingzhou Ivy Home Furnishing Co., Ltd., was one of the earliest local dealers engaged in furniture business. He believes that the rental standard of the store depends on many factors, the commercial value and supply relationship of the main store. Specifically, it includes the economic development level, price level, geographic location, popularity, and sales volume of local cities. It is undeniable that the economic development level of Jingzhou is somewhat different from that of Yichang and Xiangyang. However, as the channels of the furniture industry continue to sink, more and more furniture brands are entering second- and third-tier cities. Jingzhou, with a population of nearly 7 million, is also a market that furniture brands are reluctant to give up. In recent years, no new furniture stores have appeared in the urban area of ​​Jingzhou. To a certain extent, there has been a shortage of furniture stores, which has also raised the overall rent level of the furniture market in Jingzhou. It is reported that almost all the stores in Jingzhou City are in short supply, and the White Swan Home Plaza even has a queue.
As we all know, the operating costs of furniture distributors mainly include payment, freight, rent, staff salaries, taxes and promotional expenses. Cost accounting is a "arithmetic problem" that every dealer calculates almost every day. Shan Xiaodong believes that under normal circumstances, the rent accounts for about 30% of the total cost of the fee is the dealer's profit and loss threshold. In the case of relatively fixed rents, as the size of the dealer is larger, the proportion of rent is lower; the larger the dealer's sales, the lower the proportion of rent. In order to maintain profitability or not to lose money, distributors should try to compress expenses on the one hand, and maximize sales performance on the other.
Rent increase should talk about operation methods and "human touch"
Feng Qingshan, chairman of the Jingzhou Furniture Association, believes that the level of rent is an unavoidable problem for furniture stores and dealers. At the rent level, the relationship between the store and the dealer is actually a game of interest and supply and demand, and it is also a process of continuous conversion between strong and weak. If the local furniture store is in short supply, the store is in a relatively strong position; if the local store is oversupplied, the dealer is in a relatively strong position, and the store is in a relatively weak position. If rents need to be increased, the operation methods and "human touch" of the store are particularly important.
In 2007, a home improvement store in Jingzhou City, without consulting dealers, sent a notice of rent adjustment to each dealer. If the rent is not paid in full and on time, the store will be closed and cleared, which will eventually lead to a large-scale withdrawal of merchants and a large-scale conflict with the store staff, which almost caused a bloodshed. Finally, it ended with the compromise of the store.
Liu Xuesong, general manager of White Swan Furniture Plaza, said that although manufacturers who want to enter the store appear to be in a queue, the store will never "abuse rent" because of this. The operation must be reasonable and legal, and full of "human touch". He pointed out that on the one hand, on the premise of guaranteeing the relative profit space, staff salaries, taxes, promotional expenses, etc. are constantly rising, and it is reasonable to increase the rent appropriately; on the other hand, the store will carry out before raising the rent. Market research and demonstration, understand the surrounding rent situation, listen to the opinions and suggestions of the dealers, and patiently explain to them, the range of the increase is also as far as the dealers can afford. In order to alleviate the economic pressure of dealers, dealers can pay monthly, and special circumstances can be delayed. It is understood that the White Swan Home Plaza raised rents three times in total, and dealers can accept the fact of rent increase. No disputes have occurred, and no dealer has withdrawn due to rent. On the contrary, some stores have paid rent on a quarterly, half-yearly, and one-year basis, and economic disputes and withdrawals have occurred.
New store may become the biggest variable
Despite the long history of news that the home distribution industry giant has entered Jingzhou, it has not yet become a reality. Dong Sujuan, deputy chairman of Jingzhou Furniture Association and general manager of Jingzhou Liqi Home Furnishing Co., Ltd., believes that once a new home store enters, there may be a "scramble battle" for dealer resources, and dealers will become relatively active and strong. Existing dealers may enter the new store, and the existing supply and demand relationship will be broken. In order to retain the existing dealers, the store may make concessions on the rent, and the rent level will also change. Of course, it depends on the scale, strength and operation mode of the new store.
Mr. Dong also analyzed and predicted that the home furnishing industry is the downstream industry of the real estate industry. A series of macro-control policies for the real estate industry since last year have had little impact on second-tier cities like Jingzhou. According to the current economic development level and price index of Jingzhou, even if there are new home stores entering the Jingzhou furniture market, it may have an impact on the overall rent level in the short term. It is not ruled out that individual stores reduce or reduce rents in disguise, but after the new store opens, It will pick up soon, and even raise the overall rent level. Therefore, the rent in the home market in Jingzhou will not fall and there will be an "inflection point", which will still rise steadily this year.
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