New observations: The dryer market is in urgent need of supply-side structural reforms

Since the beginning of this year, the overall market for agricultural machinery has been sluggish. It is generally estimated that this will be down by about half from last year. However, the grain dryer market has been extremely popular and has become one of the best in the agricultural machinery market, which contrasts sharply with the entire agricultural machinery market. A lot of dryer company heads are happy and happy. At the same time, many people in the industry have issued the "Cleaning Times Need More Cold Thoughts". According to the author, if you use a dryer, you can't just “go faster” and “make quick money”, but also try to “go steadily” and “make money steadily” to achieve sustainable development.

First, the current dryer market is mainly driven by demand

The rapid development of the dryer market has contributed to the support of national policies. The Ministry of Agriculture and most provinces regard grain dryers as the focus of purchase subsidies. Some pilot provinces in the whole process of socialized social services include grain drying operations as a subsidy, and some provinces subsidize R&D and innovation of grain dryers. These measures have effectively stimulated the enthusiasm of the company in R&D and production and farmers' purchase and use of dryers.

However, the input of farmers and enterprises in the development of grain drying mechanization dominates. The rapid development of the dryer market depends mainly on social demand. Social needs generally include two factors: First, as the income level of farmers increases, the ability of farmers to purchase grain dryers is constantly increasing. Second, with the development of large-scale food cultivation and professional management, the demand for grain dryers has become increasingly urgent.

The income level of farmers has increased year after year. Since 2004, the income of peasants has increased "14 consecutive years." During the "12th Five-Year Plan" period, the per capita disposable income of farmers increased by 9.6%. The increase in income for farmers for six consecutive years from 2009 to 2015 was higher than the increase in GDP, which was higher than the increase in income of urban residents. In the first half of this year, the per capita disposable income of rural residents increased by 7.4% year-on-year, which was higher than the growth rate of GDP and urban residents' income by 0.5 and 0.9 percentage points respectively.

The large-scale cultivation of food and professional management have developed rapidly. The scale of land-based business entities has increased year by year. In the first half of this year, there were more than 2.9 million new-type business entities such as family farms and farmer cooperatives nationwide. Land transfer, custody, and order operation services are rapidly advancing. More than one-third of the country’s land has been scaled up through circulation, and the scale of land management in Jiangsu and Zhejiang provinces has reached more than 50%. In recent years, the "food bank" and other specialized business models that have emerged in various places have effectively activated the grain circulation chain, which has facilitated grain-growing farmers and grain-using enterprises, promoted the preservation and appreciation of grain, and achieved rapid development. The large-scale planting and professional management of food grains have a strong demand for dryers. For example, in Dezhou City, a grain-growing city in Shandong Province, the number of grain dryers in the first half of this year increased by 39 units, an increase of 28% from the end of last year; of these, 24 units of agricultural machinery cooperatives had 72 units of dryers, accounting for 40 of the city’s total inventory. %.

Second, the continuous and rapid development of the dryer market requires supply side reform

The dryer market continues to grow rapidly, and it faces demand-side problems such as the slowdown in farmers' income growth. At present, the decline in the prices of international agricultural product markets and the increase in domestic agricultural production costs, “double squeeze”, the scale of migrant workers going out of employment, and the growth rate of wage levels have both “falling down”, making it increasingly difficult for farmers to increase their income. The slowdown in farmers' income has led directly to a lack of purchasing power.

In spite of this, the social needs of dryers in the coming years are still relatively large. First, because the level of mechanization of grain drying in China is still very low, it is a prominent short board for the mechanization of the entire food industry, and the potential and space for development is huge. The second reason is that with the deepening of the reform of the “three powers” ​​reform in rural land and the completion of the verification of the right, the implementation of the “Opinions on Accelerating the Establishment of a Policy System to Cultivate New Types of Agricultural Management Subjects” of the General Office of the CPC Central Committee and the General Office of the State Council, The momentum of large-scale planting and professional management of food will continue to improve. According to the national "13th Five-Year Plan" for agricultural mechanization, by 2020, the total number of grain dryers in China will reach 100,000 units, an increase of 31,000 units from the end of the "Twelfth Five-year Plan." In short, the development of the dryer market is mainly not on the demand side, but on the supply side.

The problem of dryer supply is mainly due to the large number of production enterprises, small scale, low-end overcapacity, and severe shortage of mid-to-high-end production capacity. The level of technology research and development, manufacturing technology, quality management, and after-sales service are low. It is estimated that there are three or four hundred dryer manufacturers in the country. The ratio of production capacity to market capacity has reached 5:1. The proportion of companies with annual sales of over 800 units is less than 4%, and the annual output of Bacheng's enterprises is less than 300; The problem of homogenous competition is serious. Most enterprises do not have R&D capability at all; the manufacturing process is simple and low, and basically a few or dozens of workers “knock and beat”, shoddy, lack of product quality and reliability, and weak after-sales service. Some companies sell hundreds of units a year, and there are only a few after sales teams.

Such R&D production and after-sales service capabilities are difficult to support the continuous and rapid development of the dryer market. Failure to carry out supply-side reforms in a timely manner may result in the loss of confidence, branding, and market destruction. The drying quality is not guaranteed, the machinery frequently fails, and the after-sales service can not keep up, will make the majority of grain dryer users lose confidence in the dryer company; in the information age, the market is transparent, word of mouth is important, a user to a company Losing confidence will spread word of mouth, affect potential buyers, and cause the brand of this company to be drained. It is not terrible for a company to be drained. It is terrible to cause a "domino effect" when such a company is made up of a family. With a number of developments, the confidence of users in the entire dryer market will fluctuate, resulting in the concept that “the current dryer technology is still not overdue and temporarily not to be purchased”, which will affect each other and eventually severely retard the development of the dryer market. It even led to the collapse of the entire dryer market.

Third, the dryer market supply side structural reform change?

The dryer market has great potential for development and faces rare opportunities for development. There are many positive externalities. If the industry can adapt to the needs of the situation, it will actively promote supply-side reform, go low-end production capacity, increase the supply of high-end products, and dryers. The sustained and rapid development of the market is still promising. At present, the structural reforms in the supply side of the dryer market focus on improving product quality and service capabilities.

To improve product quality as a top priority for business operations. An old craftsman known as a saddle-seller said to his apprentice that you need to speak less and the saddle you make will speak. In order to develop agricultural machinery enterprises, they must eventually rely on agricultural machinery products produced by them to speak. Grain dryer companies, in the short term, must strengthen quality control. It is necessary to step up efforts to reverse the situation of workers leaving the factory without strict technical training and products leaving the factory without strict quality inspection. Enroll professional workers and quality control personnel who have undergone professional training, strengthen technical training, improve the quality inspection system, and strictly inspect quality. Qualified products flow into society and bring endless troubles after-sales service. In the medium to long term, we must make every effort to increase the technological content. Rome was not built in a day, and the technological content of the product was not up to two days a day. However, one feasible way is to buy results through the mid-term "brainner brainy," companies lack the ability to research and development, from the universities, research institutes to introduce talent intelligence, purchase scientific and technological achievements, the introduction of talent does not seek all but for use, the results of the purchase adhere to one point One-point return on technology, willingness to spend money, science, industry and trade, and the combination of production, education, and research require each to win and win. In the long term, independent research and development should be strengthened. After short-term and medium-term capital and technology accumulation, enterprises will not only be able to carry out independent research and development, but also need to carry out independent research and development. Only in this way can the company's own core competitiveness be formed, and the company can be successful in the market competition and be invincible.

Intensified after-sales service as an urgent need for "cleaning signs." Agricultural machinery is not a fast-moving consumer product and must be protected by strong after-sales service. Especially in the current phase of grain dryers, there is no company that dares to take a chest shot and fight a ticket, saying that its products will never fail. Due to the generally weak status of after-sales service, it is urgent to accelerate the completion of this short board. In order for a brand to clamor loudly and securely and achieve sustainable development, companies must treat after-sales service as an important task. Although dryer companies cannot improve their own after-sales service system in a short time, they can carry out after-sales service business and complete personnel training, equipment installation, and other services through the after-sales service channels of other agricultural machinery companies through “borrowing to sea”. Fault repair service. In the medium to long term, dryer companies still have to establish independent service teams, service channels, and service systems from market development, sales operations, and after-sales services.

Firmness can make a difference. For those companies who are interested in long-term development and deep cultivation in the dryer industry, in the face of the current hot dryer market, they need to cherish their own reputations, increase product quality and strengthen after-sales services. After all, only if products and services are too hard can companies go further.

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