The lifestyle of contemporary young people is changing with each passing day. What remains unchanged is their pursuit of a better life. In order to optimize users' quality of life, the creative online red small household appliances have been able to maintain high popularity in the past few years. Especially last year, the popularity of the small household appliance market was almost unmatched in the household appliance segment. In the post-2021 epidemic era, the impact of the "housing economy" has gradually faded, and the growth of the small household appliance market has gradually returned to normality. Under the new normal, when consumption returns to rationality, how should small household appliance industry and enterprises achieve long-term development?

Market returns to "rationality"

With the household ownership of traditional household appliances approaching saturation, household appliance enterprises have entered the stage of stock competition. In this context, small and sophisticated new creative household appliances have opened up a "new track" in the industry: electric ovens, breakfast machines and egg cookers make it possible to cook quickly; Vacuum cleaners and sweeping robots liberate people from heavy housework; Beauty instrument, electric toothbrush and hair removal instrument have been promoted to the contemporary "three piece set for beauty"... New products "seize" various application scenarios of home life, and gradually become necessary products for more people by virtue of selling points such as price advantage or convenient use.

Especially in the 2020 novel coronavirus pneumonia outbreak, when the electricity supply chain was not smooth, the sales channels under the line were blocked, the logistics installation services were not smooth and so on. In the first half of last year, the volume of the products showed a big decline, such as the health pot, breakfast machine, egg cooker and so on. In addition, the online marketing mode based on live broadcasting and goods has been maturing, ushering in a consumption boom.

According to the report on China's home appliance market in the first half of 2020 released by China Electronic Information Industry Development Research Institute, when the retail sales of China's home appliance market decreased by 14.13% year-on-year, the small home appliance industry increased by 12.4% year-on-year with an online retail sales of 78 billion yuan. In the second half of the year, the turnover of 313 small household appliance brands in tmall mall increased by more than 1000% over the same period last year in the first hour of double 11. Benefiting from the epidemic dividend, relevant small household appliance enterprises have shown a rapid growth trend in product sales, revenue and net profit in the past year. Taking Xiaoxiong electric appliance as an example, the company's operating revenue reached 3.66 billion yuan in 2020, a year-on-year increase of 36.16%; The net profit attributable to shareholders of listed companies reached 428 million yuan, a year-on-year increase of 59.64%. "The epidemic has actually exacerbated the performance differentiation of enterprises, and this differentiation trend will continue in the future." Guo Meide, President of ovicloud, also analyzed and mentioned to the reporter of China home appliance network. Since the epidemic last year, there have been three types of brands with good performance, including head integrated home appliance brands represented by Haier and Midea and boss appliances In addition to the high-end vertical household appliance brands represented by Fang Tai, another category is the brands more focused on the Internet track in the market segment represented by Xiaoxiong and Mofei.

It is undeniable that the rapid growth of small household electrical appliances sales in 2020 was mainly due to the pulling effect of COVID-19 on consumer demand. Therefore, when the economic dividend brought by the epidemic recedes, there is great uncertainty in the market demand for small household appliances, and the high growth is difficult to sustain. In this regard, Xiaoxiong electric had a hunch as early as last October and said, "2020 is an abnormal year. On the basis of this high base, it is a certain challenge for the performance of small household appliance enterprises to maintain high growth in 2021, and returning to normal growth is a high probability event."

In fact, the market data of small household appliances in the first half of the year also confirmed this prediction. According to the data of ovicloud, the retail sales of small household appliances in the first half of this year totaled 25.08 billion yuan, a year-on-year decrease of 8.6%; The retail volume was 119 million units, a year-on-year decrease of 8.2%. "The popularity of small household appliances in the consumer market last year to some extent enjoyed the epidemic dividend. This year's market decline is more a process of the industry's' return 'to normalization in the post epidemic era". Some industry analysts told reporters that the decline in the first half of the year was the inevitable result of the overdraft of the market last year. In the medium and long term, there is still the possibility of growth in the small household appliance market. However, under the new normal, wanghong small household appliance enterprises also need to re sort out the post epidemic development ideas.

How to "act" in the future?
With the market returning to rational and normalized growth, the rise in raw material prices has also brought great pressure on the performance growth of small household appliance enterprises. At present, some small household electrical appliance enterprises have not released the semi annual report. Taking the gross profit rate data in the first quarter report of 2021 of mainstream enterprises as a reference, under the pressure of rising raw material prices, only the gross profit rate of Xiaoxiong electric appliance has increased significantly compared with the end of 2020, with a specific increase of 3.13 percentage points to 35.56%. SUPOR's gross profit margin slightly increased by 0.07 percentage points compared with the end of 2020, but the overall gross profit margin is not very high, at 26.49%. In 2020, the gross profit margin of Jiuyang shares decreased by 0.47 percentage points, and the first quarterly report of this year decreased by 0.61 percentage points again, to 31.44%. The gross profit margin of Xinbao shares decreased by 4.3 percentage points in the first quarter of this year compared with the end of last year, reaching only 19.03%.

At present, the price of raw materials is still high, and the creative small household appliances themselves are good at small size, installation free and low unit price, and win the favor of users. Under the effect of two-phase hedging, small household appliance enterprises seem to be in a dilemma. In this regard, the previous industry analysts believe that in the shift period of the development of the industry from high-speed growth to steady growth, in the face of the contradiction between rising costs and cost performance, small household appliance enterprises need to break through development inertia and path dependence, and seek a new development path through changes in products, operations and sales strategies.

How to do it?
First of all, we should pay attention to the effective grasp of the development trend. At the same time, based on the judgment of market trend and consumer demand, small household appliance enterprises should pay attention to the improvement and innovation of product function technology. For example, Li Yifeng, chairman of Xiaoxiong Electric Appliance Co., Ltd., once analyzed the three stages of user demand change in the small household appliance industry: after 60 and 70, it is mainly the traditional rigid demand category, pursuing durable goods and a sense of quality; The post-80s generation began to have a demand for creative new categories of products, and many new categories of products were born at this stage; The generation Z after 95 and 00 is the division of categories, paying more attention to appearance, fashion, personalization and brand experience. "The innovation of small household appliances should be based on the function, application and materials, and must be combined with the demand." taking the meat grinder of son and mother cup launched by Xiaoxiong as an example, it not only breaks the pain point that "a large cup can not beat a small amount of food materials" in the industry, but also can meet the needs of separate operation of raw meat and supplementary food, which is cleaner and hygienic. In addition, the material is also upgraded and the high borosilicate glass is used to ensure that it can be disinfected at high temperature and is not easy to crack after scalding.

On the other hand, we should accelerate the ecological construction of industrial chain. The development of small household appliances needs to form a closed-loop ecology from production, sales to maintenance and service. Only when all links are improved synchronously can the whole industry be stable and far-reaching. "Sustainable development requires more multi-dimensional growth and more systematic capacity construction", Li Yifeng stressed. Based on this, Xiaoxiong Electric has introduced digital operation to improve its manufacturing capacity in the development process in recent years; On the other hand, continuously enrich product categories, improve market share of key categories and improve brand strength.

"The development of wanghong small household appliances conforms to and conforms to the new consumption trend of generation Z, but when the industry and enterprises reach a certain scale, relying on the original playing method may not be able to meet their needs to continue to expand on a large scale", Zhang Cun, general manager of GfK (China) household appliance division, analyzed to the reporter. At this time, enterprises need to calm down and "practice their internal skills". "For example, we should supplement some contents in R & D and production, improve the quality and the ability of the whole offline operation from the category, and do a good job in 1-10 and 10-100 on the basis of the original 0-1, so as to have a long-term development."
In the future, during awe2021, the reporter interviewed a senior executive of a small household appliance enterprise. He told the reporter that in the future, there will be more and more new brands in the small household appliance industry, which will weaken the brand effect. Based on the characteristics of "faster innovation iteration", "higher expectation of users for products" and "stronger variability" of small household appliances compared with large household appliances, It puts forward higher requirements for enterprises that want to stand out. "The whole industry and enterprises have opportunities for transformation and upgrading. It depends on who can seize such opportunities in the next 10 years."

Indeed, in the long river of the times, no enterprise can ensure that it has always stood at the top of the wave. Only by maintaining a keen market response and adhering to innovation can it stride forward and achieve greatness. In this regard, perhaps the second part of the series of topic selection reports of "who will make the tide of small household appliances?" in [zero degrees Celsius], the rapid rise of Xiaoxiong electric appliance and the industry exploration, practice and growth under the development of the times can provide some reference and inspiration for the transformation and upgrading of small household appliance enterprises.