[Source: Gaogong LED 's " LED Lighting Channel" magazine January issue ]
Currently, the LED industry is in the post-shuffling era. Whether it is upstream horizontal integration or vertical integration in the middle and lower reaches, integration of mergers and acquisitions must first clear the intentions and goals, patents? Brand? market? "Lighting Channels" reporters through interviews, Na Duofang speech, jointly explore the topic of integrated mergers and acquisitions.
    01. Wang Maozhong, General Manager of Shenzhen Zhongyue Semiconductor Lighting Co., Ltd. (Finishing reporter/Xiong Yuheng)
Chip companies first integrated tide
When an industry develops to a certain time, reasonable integration can make the industry gradually concentrate on standardization and concentration, which is of great benefit to the development of the entire industry.
The industrial chain includes upper, middle and lower reaches (that is, we often say epitaxial, encapsulation, finished products). Usually, the upstream is a large amount of capital investment, and the technical content is relatively high. In view of the overcapacity generated by blind investment in the previous period, if the product advantage is not obvious, the operation will be difficult to sustain, and Xurui Optoelectronics is a living example. It is expected that the chip industry will be the first to merge.
The middle and downstream are mostly small and medium-sized enterprises, and the technology content is low, but the number of enterprises is huge. At present, the packaging and finished products market is confusing, price wars, and shoddy phenomena happen from time to time. But as of now, there has not been a single or very competitive brand. The so-called integration can only occur in a small scale.
In the next three to five years, there will be only 5-8 large chip factories in the domestic upstream field; the mid-stream packaging part will bring great pressure to the survival of packaging enterprises as the integration of chips is completed, and the number will be reduced to the current 1/3; and the application of this product, the segmentation area will be strengthened, the market demand is also further increased, there should be a large room for development. In the field of packaging and application, although there will be deeper integration, due to the special needs of the market and the characteristics of the LED industry, in addition to the large-scale development of the market, there are also some "partial door" or special lighting requirements. After three or five years, as long as SMEs can seize these market demands, they can avoid the Red Sea battlefield and seek space for survival and development.
The process of industry reshuffle can also be seen as the process of industry integration, following the market law of “big fish eat small fish, fast fish eat slow fishâ€. However, companies are like big-handed children. According to the characteristics of Chinese companies, they prefer to close down and are not willing to be acquired or merged. Moreover, the integration “looks beautifulâ€, but there are too many uncertain factors in the initial stage of integration or in the later stage of integration. Therefore, the process of industry integration will not be smooth.
    02. Xie Xiaopei, General Manager of Nantong Yuyu Lighting Technology Co., Ltd. (Organizer / Xiong Yuheng)
SME integration is the most urgent
Industry development needs to be standardized and must undergo large-scale integration. Therefore, industry consolidation is an irreversible trend. In the whole industry, the integration of small and medium-sized LED enterprises with an annual output value of less than 100 million yuan is particularly urgent.
If such enterprises do brand, expand scale, and channel, they lack a strong capital chain as a support, and financing is very difficult; if only primary processing, along with the LED industry gradually standardized, it is difficult to escape the fate of being eliminated.
Therefore, the need for SME integration is particularly urgent, and the probability of integration is basically greater. Medium-sized enterprises can warm up in groups. If there is a complementary horizontal integration, it can be considered. If small enterprises are integrated, the value is small.
According to the current trend of industry consolidation, the annual sales should be more than 100 million yuan. In terms of production capacity, scale and channels, enterprises with corresponding scales will be integrated with small and medium-sized enterprises. In the whole industry chain integration, the upstream enterprises have strong financial resources, the downstream enterprises have great potential, and the investors are the public. Therefore, the upstream and downstream enterprises will integrate the midstream packaging enterprises.
The development of small and medium-sized enterprises should be based on localization, customization or specialization. Even if they can not seize the corresponding market in the segmentation field, they can give investors confidence and join the ranks of mergers and acquisitions, and will not be eliminated. .
In fact, whether it is a large-scale enterprise to integrate small and medium-sized enterprises, or a group of enterprises to warm together, strong alliance, the most crucial link is to find an effective way of integration after integration. For example, the combination of Dehao Runda and NVC Lighting, although specific insiders are not known, such as NVC lighting was forced to introduce Dehao Runda, mixed with too many personal factors of Wu Changjiang, personal is not big Optimistic about the integration of these two companies.
    03. Shen Genqiao, Manager of Hangzhou Shanshui Lighting Business Department (finishing reporter/Long Jiajia)
Integration promotes market purification
The integration between enterprises, for our dealers, if it is not the agent of that brand, the feeling is not big. However, if there is an integration of the agent's brand, it will involve the immediate interests of the dealer, and may be concerned about many issues: the channel will not change? The pattern does not change? The product does not change? The original profit agreement has not changed? Of course, I hope that the interests of dealers can also be considered when integrating enterprises.
Nowadays, the products on the market are mixed and the vicious competition is serious. Some big companies' products have brand reputation, and the quality is relatively guaranteed, but the price is too expensive, the market acceptance is low, and the profit margin is small. A lot of big dealers, under the banner of a certain brand-name franchise store, in fact, privately also rely on selling some small brands to maintain profits. However, the quality of the small label is not guaranteed, and it can be said that it can be used for three years and five years. The actual pass rate is horrifying. It is terrible to rely on the market to test the character of a business owner.
The current market lacks regulation. What dealers want to see is how the quality of high-end brands is measured. What is the quality of the mid-end mainstream, what is the price range, and how the low-end is judged. A quality standard that is widely recognized by the market, rather than relying on the instincts of dealers.
The integration within the industry in the next 2-3 years will be an inevitable trend, and it is hoped that the industry will become healthier and more organized through integration.
Currently, the LED industry is in the post-shuffling era. Whether it is upstream horizontal integration or vertical integration in the middle and lower reaches, integration of mergers and acquisitions must first clear the intentions and goals, patents? Brand? market? "Lighting Channels" reporters through interviews, Na Duofang speech, jointly explore the topic of integrated mergers and acquisitions.
    01. Wang Maozhong, General Manager of Shenzhen Zhongyue Semiconductor Lighting Co., Ltd. (Finishing reporter/Xiong Yuheng)
Chip companies first integrated tide
When an industry develops to a certain time, reasonable integration can make the industry gradually concentrate on standardization and concentration, which is of great benefit to the development of the entire industry.
The industrial chain includes upper, middle and lower reaches (that is, we often say epitaxial, encapsulation, finished products). Usually, the upstream is a large amount of capital investment, and the technical content is relatively high. In view of the overcapacity generated by blind investment in the previous period, if the product advantage is not obvious, the operation will be difficult to sustain, and Xurui Optoelectronics is a living example. It is expected that the chip industry will be the first to merge.
The middle and downstream are mostly small and medium-sized enterprises, and the technology content is low, but the number of enterprises is huge. At present, the packaging and finished products market is confusing, price wars, and shoddy phenomena happen from time to time. But as of now, there has not been a single or very competitive brand. The so-called integration can only occur in a small scale.
In the next three to five years, there will be only 5-8 large chip factories in the domestic upstream field; the mid-stream packaging part will bring great pressure to the survival of packaging enterprises as the integration of chips is completed, and the number will be reduced to the current 1/3; and the application of this product, the segmentation area will be strengthened, the market demand is also further increased, there should be a large room for development. In the field of packaging and application, although there will be deeper integration, due to the special needs of the market and the characteristics of the LED industry, in addition to the large-scale development of the market, there are also some "partial door" or special lighting requirements. After three or five years, as long as SMEs can seize these market demands, they can avoid the Red Sea battlefield and seek space for survival and development.
The process of industry reshuffle can also be seen as the process of industry integration, following the market law of “big fish eat small fish, fast fish eat slow fishâ€. However, companies are like big-handed children. According to the characteristics of Chinese companies, they prefer to close down and are not willing to be acquired or merged. Moreover, the integration “looks beautifulâ€, but there are too many uncertain factors in the initial stage of integration or in the later stage of integration. Therefore, the process of industry integration will not be smooth.
    02. Xie Xiaopei, General Manager of Nantong Yuyu Lighting Technology Co., Ltd. (Organizer / Xiong Yuheng)
SME integration is the most urgent
Industry development needs to be standardized and must undergo large-scale integration. Therefore, industry consolidation is an irreversible trend. In the whole industry, the integration of small and medium-sized LED enterprises with an annual output value of less than 100 million yuan is particularly urgent.
If such enterprises do brand, expand scale, and channel, they lack a strong capital chain as a support, and financing is very difficult; if only primary processing, along with the LED industry gradually standardized, it is difficult to escape the fate of being eliminated.
Therefore, the need for SME integration is particularly urgent, and the probability of integration is basically greater. Medium-sized enterprises can warm up in groups. If there is a complementary horizontal integration, it can be considered. If small enterprises are integrated, the value is small.
According to the current trend of industry consolidation, the annual sales should be more than 100 million yuan. In terms of production capacity, scale and channels, enterprises with corresponding scales will be integrated with small and medium-sized enterprises. In the whole industry chain integration, the upstream enterprises have strong financial resources, the downstream enterprises have great potential, and the investors are the public. Therefore, the upstream and downstream enterprises will integrate the midstream packaging enterprises.
The development of small and medium-sized enterprises should be based on localization, customization or specialization. Even if they can not seize the corresponding market in the segmentation field, they can give investors confidence and join the ranks of mergers and acquisitions, and will not be eliminated. .
In fact, whether it is a large-scale enterprise to integrate small and medium-sized enterprises, or a group of enterprises to warm together, strong alliance, the most crucial link is to find an effective way of integration after integration. For example, the combination of Dehao Runda and NVC Lighting, although specific insiders are not known, such as NVC lighting was forced to introduce Dehao Runda, mixed with too many personal factors of Wu Changjiang, personal is not big Optimistic about the integration of these two companies.
    03. Shen Genqiao, Manager of Hangzhou Shanshui Lighting Business Department (finishing reporter/Long Jiajia)
Integration promotes market purification
The integration between enterprises, for our dealers, if it is not the agent of that brand, the feeling is not big. However, if there is an integration of the agent's brand, it will involve the immediate interests of the dealer, and may be concerned about many issues: the channel will not change? The pattern does not change? The product does not change? The original profit agreement has not changed? Of course, I hope that the interests of dealers can also be considered when integrating enterprises.
Nowadays, the products on the market are mixed and the vicious competition is serious. Some big companies' products have brand reputation, and the quality is relatively guaranteed, but the price is too expensive, the market acceptance is low, and the profit margin is small. A lot of big dealers, under the banner of a certain brand-name franchise store, in fact, privately also rely on selling some small brands to maintain profits. However, the quality of the small label is not guaranteed, and it can be said that it can be used for three years and five years. The actual pass rate is horrifying. It is terrible to rely on the market to test the character of a business owner.
The current market lacks regulation. What dealers want to see is how the quality of high-end brands is measured. What is the quality of the mid-end mainstream, what is the price range, and how the low-end is judged. A quality standard that is widely recognized by the market, rather than relying on the instincts of dealers.
The integration within the industry in the next 2-3 years will be an inevitable trend, and it is hoped that the industry will become healthier and more organized through integration.
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