Sichuan furniture industry channels can complement each other to see the cost

At present, more and more furniture companies have started to launch direct-operated stores on the basis of original franchise stores. This practice has attracted the attention of franchisees. In their opinion, the directly operated stores will have an impact on franchise stores and may even be replaced by them, thereby impairing the interests of franchisees. Objectively speaking, this concern is not a dealer's oversight. Therefore, companies should carefully consider whether or not to run directly-operated stores. Once they decide to operate directly-operated stores, they should properly handle the relationship between the stores and franchise stores, not only to take advantage of the stores, but also to avoid direct stores to franchise stores. Causes interference and impact. For many companies, this is not easy.

The majority of first-tier cities are directly-operated stores. Now, most of Sichuan's home-based enterprises are trying their best to build a flagship store of a direct nature in the first-tier cities in the province. Its main functions are two: First, it is used to display the company's overall strength and image; Second, it occupies the "home front door" of the primary market, to facilitate the acceptance of engineering orders, to meet the far away from the franchisees to observe. For these two kinds of functions, these flagship stores are often very luxurious in decoration, and the decoration costs are generally more than 500,000 yuan. It is understood that a direct-branded flagship store established in the first-tier cities of the province can bring an annual retail sales quota of tens of millions of yuan to the company. This is precisely why companies have invested heavily in flagship stores in first-tier cities. the reason.

In addition to the flagship stores opened by local companies, some foreign coastal brands have opened flagship stores in first-tier cities in Sichuan, and their results have been quite good. The manager of a flagship store in Chengdu, a coastal high-end solid wood company, told the author that in the first year, the cost of building a store was repaid in only three months. It was a profit of several million yuan. In the following years, the annual turnover was close to that. Ten million yuan.

As the earnings of flagship stores operating in first-tier cities are largely guaranteed, companies will generally choose direct flagship stores in the first-tier cities instead of franchised stores. Of course, there are also cases in which a few companies are concerned about the interference of direct flagship stores in franchise stores, as well as the limited manpower and financial resources of companies, and they only set up direct flagship stores in one or more particularly important cities, or Simply abandon the direct flagship store and build the brand product display shop in the factory.

The majority of second- and third-tier cities franchise stores in Sichuan in the country's second and third-tier market layout, the form of franchise stores as the channel focus. With the advancement of the integration of urban and rural construction, many franchise stores in Sichuan have extended to the province and the second and third tier cities in the country, and even some townships. At the same time, branded furniture companies from the international and coastal industries also used Chengdu as a radiation point to quickly enter the second and third-tier markets in the western region and snatched the western market with local Sichuan brands.

Nowadays, the fight for the second- and third-tier market dealers has begun and will intensify in the coming years. This means that Sichuan's home companies must not only focus on production, but also need to rely on a strong marketing team and advanced marketing concepts to vigorously expand the secondary and tertiary markets and continuously increase market share. Sichuan's home companies can only establish a multi-level sales network in order to make the brand bigger and stronger, and compete with well-known foreign brands.

Profits and costs are the key manufacturers to open direct stores or franchise stores, the key to choice is nothing less than two aspects: profit maximization and minimization of costs.

Intuitively, since it is not necessary for distributors to benefit from dealerships, they should be able to maximize profits and minimise costs, and at the same time, they will be more conducive to the company’s control over the market. But in fact, such judgments can only be built on the basis of theory. After the actual operation, the integrated cost of opening a direct-to-operate shop is often higher than that of franchise stores, and management and operation are more difficult. Therefore, unless there is a sufficient solid foundation of human and financial resources, companies are more willing to choose the mode of joining investment, even if they open direct-operated stores, they will strictly control the number.

In fact, the core competitiveness of dealers lies in that they are very familiar with the local market and can give full play to their local resources to expand their markets. The advantage of this “person” is that it is difficult for enterprises to have, and it is also the dealer’s core strengths. As long as dealers give full play to this advantage, they can get good sales, and help companies establish a customer service system with local cultural characteristics, and bring them closer to consumers and consumers. To a certain extent, dealer franchise stores and factory outlet stores can achieve complementary advantages: Factory outlet stores emphasize brand image and standard service; franchise stores are easy to realize emotional communication with customers and create an easy and harmonious business environment. Furniture companies must recognize this in order to avoid chaos in the selection and operation of channel models.