Raw Materials Are Rising Again, LED Display Manufacturers Should Asking Who To Raise Prices

- May 16, 2019-

With the maturity and reshuffle of LED industry, during the 13th five-year plan period, the government gradually adjusts the subsidy policy, and the subsidy for upstream chip is gradually narrowed. The government will narrow the subsidy, which will restrain the disorderly expansion of LED chip production capacity from the source of the industrial chain, and is expected to transfer the subsidy to the LED lighting application end, which will pull the LED industrial chain from the demand side, and the supply and demand structure of China's LED industrial chain will gradually improve.


Recently LED display manufacturing industry again encountered "iceberg", the second half of the environmental protection began, LED by PCB board upstream raw materials to return to the beginning of the year "up and up" situation:


Since the beginning of July, shandong jinbao, kingboard, mingkang and several other companies have issued copper foil, copper clad board price increase, increase the price of 10% copper clad board, at the end of July, fujian wood forest lighting, east chenghong industry, Morgan electronics, hailue electronics and other PCB industry enterprises have also issued circuit board price increase notice. And recently according to the PCB board inside course of study supplies supplier to divulgate: at present manufacturer of manufacturer of raw material of a few board is in dark ground brew to rise in price again (expect to rise 10% left and right sides, already had manufacturer price to rise 3% now, once rise to 10%, PCB board manufacturer also can adjust price collectively again). LED display price


Recall last year: a week received two or three price increases notice, until later found that, in fact, the price increase is good, some factories directly raw materials off! Stop production ahead of the annual leave! That's the direct rhythm of fainting.


LED display industry price increase cartoon pictorial


Suppliers here are raising the price "big knife", a heart of the question: LED display manufacturers to whom the price!


Someone immediately thought of it. Very simple: go up to the client! Ha ha, really have so easy good. Price reduction is easy to increase difficult, this sentence is the current LED display industry the most true portrayal. Don't say the end customer can accept the price increase, just ask the peer answer no price increase, are hanging. In a word: LED display prices "difficult". Shenzhen LED display price


Small and medium-sized LED screen enterprises dare not go up


As a downstream screen enterprises, in the face of upstream raw material price surge, wait and see whether the price is taken for granted, recall the end of last year, the number of screen enterprises in the industry to look forward to waiting for terminal use LED display product price news, but ultimately in vain. At present, many screen enterprises have been fully aware that: after a long time of game, it is difficult to raise the price of LED terminal display products, especially for small and medium-sized screen enterprises: dare not raise the price is the truth.


Under the current market environment, there is no strong brand advantage and capital strength of small and medium-sized screen enterprises by what stand firm? Is price, low price is the biggest advantage of them, and once the raw materials prices rose sharply, will further compress fall they have relatively meager profit space, in this case if the initiative to give up their price advantage, cut prices, will only have two results: one is the direct customer cancelled the order, to terminate or delay; Another is that customers directly to the price of competitors, the order, cooperation. Perhaps these two cases will let the small screen enterprises play out. Therefore, the more in this case, many small and medium-sized screen enterprises but more dare not "act rashly". Shenzhen LED display screen manufacturers


Brand LED screen prices will not rise


Why do you say that? Firstly, for well-known LED display companies, they can sign long-term supply contracts with suppliers through futures and establish their own raw material bases to ensure stable supply of raw materials. Secondly, big-screen brand enterprises have high added value of raw materials, strong ability to resist the risk of price increases, and at the same time, they can grasp the middle and high-end market with advanced technology and high-end manufacturing, so as to win the guarantee of profits. Finally, the brand of large screen enterprises in the capital also has a great advantage, can have sufficient capital strength to deal with the rising tide; So they don't have to rely on price increases to ease profit pressures. But there is no pressure to survive the large screen enterprises may take the opportunity to seize part of the small screen enterprises market, not only will not increase prices, but in the terminal market to take the initiative to reduce their prices, this will undoubtedly be a huge blow to small screen enterprises.


Therefore, in general, relying on price increases to alleviate the pressure of raw material prices is slim, the best way to reduce the cost of terminal screen enterprises by optimizing the way of productivity, so only continuous in-depth study of the production process can be in a safe place! With no physical productivity, such as distributors and traders to LED display of the nature of enterprise is concerned, this is a bad news - raw materials rise in price, display enterprise want to maintain our original price, this squeeze the distributors and traders to profit margins, and even endanger the survival, once the raw material prices out of control or the industry a new round of reshuffle, such companies will most likely take the lead out.