The construction machinery industry should open its market with brands, emphasizing brand development against price wars

Last year, there were 8 companies that produced loaders that produced over 10,000 units and became the world’s largest producer of loaders. But so far, the most direct and effective means for most companies to seek market share is still price.

During the booming market demand in the construction machinery industry, production capacity became the core competitiveness. The expansion of production capacity has become the first choice for companies, and the capacity of major companies has soared. On the one hand, there is a significant increase in output, and on the other hand, industry profits have fallen. Analysts believe that this is a terrible signal that the lethality of the price war, coupled with the huge increase in raw material prices, has greatly reduced the profitability of the industry.

The domestic construction machinery market has entered the era of borderless competition. The Chinese construction machinery market has become a must-win area for domestic and foreign construction machinery manufacturers, and the competitive threat posed by newly entered domestic and foreign manufacturers will inevitably depend on prices alone. The market's business has caused a fatal blow. The consensus reached by all loader companies was that the increasingly fierce competition, oversupply of production capacity and high raw material prices have squeezed the profitability of the loader industry extremely narrowly. At the same time, users will pay more attention to the total cost of use of the products and the quality is poor. Products with low technological content can no longer meet the increasing demands of users. If competition still only stays at the level of low-level primary competition, enterprises will be eliminated by the ruthlessness of the market.

The tool for the machinery industry to respond to the price war is value marketing, which combines product value, service value and brand value into one. The implementation of a technologically advanced development strategy always emphasizes the primacy of technological innovation and product development in the company's development strategy. Through product differentiation and innovation, reforming product value and getting rid of price competition caused by homogenization of products, we must focus on providing customers with comprehensive and timely services, and increase the added value of products through services.

In today's market competition situation, in addition to competition in product quality, reliability, and service, the contest of intangible assets is another invisible war. The brand must withstand the tempering of the market, in order to enjoy a high reputation in the user's mind, so the "price war" is not the only way out of the construction machinery industry. High-level people in the construction machinery industry have been squeezing profitability for the loader industry for several years and have shown a downward trend, calling for the industry to focus on brand development to combat price wars.