SMEs fall into the meager profit trap: 2 tons of steel profit is not enough to buy popsicles

Abstract At the same time that the German Industry 4.0 concept is rapidly gaining popularity around the world, the “Made in China 2025” plan, which has received much attention, is also coming out. At the same time that the country has introduced a series of measures to revitalize the manufacturing industry, China's manufacturing industry is not strong, and the added value is low.
At the same time that the German Industry 4.0 concept is rapidly gaining popularity around the world, the “Made in China 2025” plan, which has received much attention, is also coming out. At the same time that the country has introduced a series of measures to revitalize the manufacturing industry, China's manufacturing industry is not strong enough, and its value-added is low. The reporter recently visited a number of small and medium-sized manufacturing enterprises and found that under the pressure of demographic dividend reduction and tight foreign trade situation, a large number of manufacturing enterprises are still in the state of overcapacity, and are in the dilemma of meager profit operations, such as "two. The profit of tons of steel often cannot be replaced by a popsicle" is becoming a true portrayal of the steel industry. In addition, some medium-sized manufacturing enterprises are also unable to enjoy the financing treatment of large enterprises, and they are not able to enjoy the entrepreneurial concessions of small and micro enterprises, and fall into a “policy isolation”.

Two tons of steel profit is not enough to buy a popsicle

Some companies have encountered policy "isolated"


        The reason for the overcapacity, in addition to the policy factors, at the enterprise level is largely due to the blind pursuit of industry profits by small and medium-sized enterprises, leading to low levels of repeated competition.

        The reporter recently visited ten small and medium-sized manufacturing enterprises. From the reporter's opinion, the problems facing the current manufacturing industry cannot be ignored.

        Overcapacity is still outstanding, and homogenous competition is intensifying. In this year's government work report, the issue of "insufficient innovation capacity and outstanding overcapacity problems" was once again mentioned. Take the steel industry as an example. In the past two years, the profit of two tons of steel has often been replaced by a popsicle, which is the most realistic portrayal of overcapacity in the steel industry.

        Ren Daoguan, business manager of Zhongshan Bada Machinery Manufacturing Co., Ltd., said that due to the low threshold of the manufacturing industry, the industry association's overall planning is biased towards business rather than mandatory, and the problem of fierce competition has been widespread. “Especially in the manufacturing industry where there is a little investment and profit, the company is rushing into the head.”

        Some small business leaders hope that the state can give certain financial support and policy guidance in terms of bank financing, technology research and development, and office leasing. Although some relatively mature enterprises have similar ideas, they are more expecting that the state can strengthen macroeconomic coordination by raising industry thresholds and restraining “price-price” competition.

        Guo Yuxi, head of the Jinjin Equipment Division of Jinan Xintian Technology Co., Ltd., spoke to reporters as a medium-sized manufacturing company. Usually, he does not enjoy the financing of large enterprises, nor does he enjoy the entrepreneurial benefits of small and micro enterprises. "Policy isolation."

        Experts pointed out that since China proposes to properly handle the relationship between the government and the market in comprehensive and deepening reforms, it should fully trust the market and let it play its role in eliminating backward production capacity and reorganizing the competition order. All departments at all levels should minimize the direct support of the policies of the forestry and forestry, and avoid enterprises relying on "policy soft meals" to allow fair competition in the market.

        In addition, the “fleeing” of foreign capital has also sounded the alarm of the decline in traditional production advantages. Subject to the rapid rise in labor costs, some foreign manufacturing companies love the Chinese market, but they will move out of manufacturing.

        “This is a signal that the traditional manufacturing advantage of China's manufacturing industry is declining.” Zhang Lei, Marketing Director of Dajin Laser (28.59, 0.14, 0.49%), said that a small number of foreign-invested manufacturing companies are not directly involved in their production and operation. Impact, however, local companies should be aware of it. The profits of China's manufacturing industry can no longer rely on cheap labor resources, and finding the way to cultivate competitiveness is the most reliable long-term plan.

        Some business leaders believe that the migration of a small number of foreign-funded enterprises may have certain impact on the domestic supporting enterprises, but the impact on the macro-economy is limited. After all, most of these enterprises are only production bases. Zhu Sendi, special adviser to the China Machinery Industry Federation, believes that the most attractive foreign investment is the Chinese market. As the technical elements become more and more important, the impact of labor costs on profits will be less obvious. The future of foreign investment in China will still have a good profit prospect.

Weak foreign trade forced companies to expand domestic demand

Structural “labor shortage” is increasing

        During the visit, most business owners reported that although the export situation has improved compared with 2008, it still has different degrees of decline compared with the peak, and the demand in overseas markets has been weak. In the short term, there are still no signs of obvious improvement. Although the company is aware of the importance of expanding the domestic market, it faces the fierce competition brought by the new round of domestic demand.

The outlook for foreign trade is not optimistic, and the export situation is complex and changeable. Tianjin Boruit Tourism and Scenic Train Co., Ltd., located in Tianjin Airport Economic Zone, is currently the largest manufacturer of small tourist trains in China. Although it is the largest in the industry, it can only be regarded as a small and medium-sized enterprise in the entire manufacturing industry.

        When the reporter came to the factory, I saw a few blue-and-white sightseeing train cars being loaded into containers and ready for sale to Italy. "We are all taking orders, and the products meet the EU emission standards." Fan Zhigang, the company's chief engineer, told reporters when he visited the workshop that Boret used to produce electric vehicles, but the electric vehicle market was highly competitive. After focusing on the small train industry, the profit is more stable, the key is to open the market in the export market.

        Although the same order is the mainstay, the days of furniture manufacturer Meikemeijia are not so good. According to Gu Shaojun, general manager of the manufacturing base of Meike International Furniture (Tianjin) Manufacturing Co., the decline in export competitiveness caused by exchange rate changes since last year has become a reality. "Affected by the exchange rate, Meike Furniture began to increase the proportion of domestic sales, basically stopped the OEM OEM production for foreign brands." He said that in the past few years, the company's export ratio was over 90%, and now it has dropped to about 60%. Although the state has introduced a series of policies on export tax rebates and quarantine fees, these changes in exchange rates and the shrinking of overseas markets have helped the export.

        In addition, the manufacturing industry is still facing a tense situation in which the “labor shortage” of grassroots production posts still exists and the structural “labor shortage” is increasing. Every year after the year, manufacturing enterprises in the eastern coastal areas will generally face a “labor shortage”. The reporter learned from the Tianjin Binhai New Area Human Resources and Social Security Bureau that as a traditional manufacturing cluster, the Binhai New Area manufacturing industry is expected to have a labor shortage of 68,200 this year. Among them, the electronic information, new energy and automobile industries ranked the top three in terms of employment demand. Great Wall Motor (56.11, -0.40, -0.71%), Sanmei Electric, Lizhong Wheel, Huatai Automobile have a large demand for labor, and only Changcheng Automobile [Weibo] has a labor demand of 3,550.

        “It’s better to start from the various verbal promises to retain workers, and to improve their skills and benefits.” Zhang Lei, marketing director of the Han’s Laser Sheet Metal Equipment Division, said that the division mainly produces laser cutting machines, with more than 700 employees. More than half of them are proficient in relevant skills. It is precisely because employees grow up with the company, income grows in an orderly manner, and pension and medical care are guaranteed. Therefore, the company's employment structure has gradually stabilized.

        In the view of Li Changsheng, deputy general manager of the sales company of Tianjin No. 1 Machine Tool Plant, the current “labor shortage” is mainly reflected in structural problems. The “labor shortage” of production and operation workers is concentrated in a short period of time, but it can still be solved through various channels. The hardest to recruit is a skilled worker and a mature marketer. Therefore, this company has already cooperated with local vocational colleges to develop “order-based talents” in a targeted manner.

        Some enterprises have reflected that one of the root causes of the “labor shortage” is that migrant workers’ sense of belonging is not strong, and this is caused by problems such as household registration and housing, which directly leads to migrant workers’ “migrant-bird” mentality. Where is the good treatment? Tang Xiguang, a professor at Shandong University, believes that with the establishment of multiple points and the improvement of the housing system, the future of “labor shortage” requires local governments and enterprises to establish a sound and standardized labor security system, with a focus on training skilled workers.

Core technology is missing into fatal injury

Transformation and upgrading urgently need to abandon the wait-and-see mood

        Some enterprises have certain fears about transformation and upgrading, and they are reluctant to abandon the traditional manufacturing that is still profitable. Experts believe that these need the relevant departments to act to provide confidence and institutional guarantee for enterprise transformation.

        Guo Yuxi told reporters that in the past, the manufacturing profit model with income minus cost is changing. The original model is not conducive to stimulating technological transformation and renewal, but it is also likely to cause low-level redundant construction. “Our main profit point now is to provide complete solutions for pre-sales reservations, sales and after-sales services, which is also the profit model of foreign manufacturing companies.”

        Daqiuzhuang Town, Jinghai County, Tianjin is the largest welded pipe processing base in China. It used to rely on the steel processing industry to let farmers live a prosperous life. The reporter was informed in the local interview that as the steel industry fell into the "cold winter" in recent years, most enterprises still "spell resources, high consumption" and operate at a low profit. The process equipment is backward and the product grade is low, which affects the profitability of the company.

        “Transformation and upgrading, economic data in the short-term town may come down, but in the long run, the transition is imperative, and we can’t hesitate.” Dachang Zhuangzhen’s mayor Kong Fanming said that Daqiu Zhuangzhen has been painstakingly thinking about 398 of the town. The traditional steel manufacturing enterprise classification reform, promote the deep processing of pipe materials, metal products and other enterprises to carry out technological transformation, research and development and expansion, in order to achieve transformation and upgrading, for the long-term management, high pollution, high energy consumption of 43 companies to eliminate, shut down, Relocation processing.

        The lack of core technology has caused embarrassment to the manufacturing industry, and most companies have a deep understanding. Zhang Lei, Marketing Director of Dazu Laser Sheet Metal Equipment Division, said that the main fiber laser cutting machine of this division was developed after being introduced from abroad in 2009. Because the domestic light source technology is still immature and the power is generally low, the core components are still old. Need to be imported from abroad.

        Huang Qunhui, director of the Institute of Industrial Economics of the Chinese Academy of Social Sciences, reminded that artificial intelligence and digital manufacturing are being widely promoted around the world, and it is possible to gradually weaken the original advantages of China's manufacturing industry. At present, major developed countries have put forward the strategy of “re-industrialization”. It is necessary to realize that this is not the repetition and return of the traditional industrialization road, but to accelerate the development of advanced manufacturing technologies and drive the development of the manufacturing industry by finding new strategic support points for technological innovation.

        Wang Xianming, secretary-general of Binhai New Area Intelligent Manufacturing Industry Technology Innovation Strategy Alliance, and other experts suggested that in the industry of robots (60.050, 0.05, 0.08%), China should take control equipment technology as the core, based on general products, in accordance with domestic robot design requirements. To make it more specialized and practical. The state may add the first (set) special funds for the development of technical equipment, with a focus on supporting robot manufacturers to accelerate the industrialization process.

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