LED channel construction should not rush

"The channel is king, and the brave man goes first." This sentence has been well verified in the development of traditional lighting companies for more than a decade, and many led companies also embrace such principles to sprint channels. However, after two or three years of turmoil, LED lighting companies have lost most of their channel construction efforts. Terminal acceptance is low, and cost changes should be the main reason.

In the aspect of channel construction, we have been trying to take the channels of the project providers, distributors, e-commerce, and designers. This year, we launched the LED business license project, and we dared to test the LED monopoly channel after the product line was gradually improved, and the pace was also very cautious. The first is expensive, although only 5 stores are established in developed regions, but the initial investment reached more than 8 million. Secondly, the scale effect of the commercial photo just launched has not yet been formed, and other systems need to be gradually improved. And if it is to hold the purpose of establishing a successful one, the speed cannot be blindly accelerated.

In fact, LED channels are not unfathomable. Like traditional lighting, current LED lighting channels can be divided into: engineering (invisible) channels and circulation (distribution) channels. Most of the customers in the engineering channels are governments, hotels, and villas. Enterprises often play the role of “integrated service providers” and need to coordinate many relationships among the project providers, designers, and construction companies, and follow up in the process.

The disadvantages of this model are the decentralization of the project and the long return period of funds. Distribution channels need to use partners such as distributors, agents and franchisees to achieve full control of end customers. The advantage of this model is that it can quickly layout and realize the “flower blossom” of the product network and quickly occupy the consumption field. The disadvantage is that it is impossible to control the profitability and loyalty of the dealers. If there is no attractive investment policy, or if the profits are not realized in the short term after joining, it is common for dealers to withdraw or fight back.

At present, LED companies have a lack of experience in channel construction, low awareness, few types, high prices, businesses are also unfamiliar with LED product technology, brand loyalty is not high, after-sales service system has not yet formed a series of short board. Therefore, I think that LED channel construction should not be rushed forward, otherwise the speed will not reach.