Recently, one thing has triggered widespread media attention. Zhanjiang Mayor Wang Zhong-Bing walked off the reform and reform committee, holding a kiss of 80 billion steel project approval. At that moment, he became the spokesperson of "kissing growth." In late May, the National Development and Reform Commission began intensively examining and approving local investment projects. The market expects that a new round of stimulus will be born. Some investment banks even estimate that the scale of stimulus measures may be as high as 2 trillion yuan, which is half of the “four trillion†in 2008.
If we really have another "four trillion yuan" time, will the days of the flooring industry become better? Let us look at the most basic supply and demand relationship in the market economy.
Before 2008, like most of China's industrial industries, China's flooring industry is in a period of rapid development. In general, the market is in short supply. By the middle of the first decade of the 21st century, supply and demand were basically balanced. The rapid rise in house prices that began in 2006 triggered an upsurge in real estate investment. This balance was maintained until 2010.
In 2008, with the outbreak of the international financial tsunami and the sharp decline in exports, the State Council has launched a fiscal policy of RMB 4 trillion in central investment and a loose monetary policy. The supply of industrial products, including real estate, continued to increase. Because the currency was excessive, private investment and consumption were stimulated after they were basically saturated. This maintained the balance between supply and demand.
In 2010, after the regulatory policies came out one after another, demand began to shrink. Unbalanced supply and demand then fully emerged - almost all of the excess supply of industrial products - steel, aluminum, cement, polysilicon, LED, automobiles, televisions, mobile phones ... of course, including the floor. By 2011-2012, this situation was even more pronounced. We said that in 2012, the environment was not good. However, in fact, what is more direct than the larger environment is the “small environment†in which the flooring industry’s overall supply exceeds demand. Our business is not easy to do because our flooring industry has already exceeded supply: the oversupply of floor production, the oversupply of market areas, and the oversupply of market brands... Only by facing this cruel reality can we be better. Face the upcoming cruel shuffling.
We may also see that since the middle of 2012, the national policy has begun to relax and the monetary policy has begun to loosen. However, we will also find that the supply and demand of the flooring industry will be very limited. The days when the real estate industry has made great strides are gone forever, and the room for falling house prices is also limited. The demand for the future Chinese flooring market will mainly need to be supported, and it will continue to grow steadily and will be less and less affected by macroeconomic policy fluctuations.
Whether it is “training internal strength†or “preparing personnel,†or “strategic adjustment,†and “deepening the market,†there is still too much to be done for the floor companies, in addition to waiting for the policy outside the city and a complete improvement of the economic environment. .
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