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LED Display Industry Export Status And Problems
Jan 04, 2019

Core Tip: With the rapid development of economic globalization, China's economy is gradually merging with the world, and Chinese products are increasingly entering the international arena. In many cases, Chinese products are synonymous with good quality and low price in the eyes of the world's friends. They were once popular in the international community. The export of Chinese products has also become the focus of many enterprises. However, behind this prosperity, there are hidden hidden concerns. The problems of product quality, differences in international social concepts, trade barriers, after-sales service, etc. have become the limiting factors for Chinese enterprises’ exports. . The LED display industry is no exception. Since the beginning of the development of the LED industry, it has experienced rapid development and achieved the fastest development in the shortest time. Especially in the LED display industry, export companies have their own advantages and differences. Companies that choose Nuggets in overseas markets have their own considerations and will encounter their own problems. Under the temptation of high profits overseas, many companies have chosen to export this road, but it is followed by fierce market competition.

LED display export background and reasons

China's LED industry started late, and in the context of LED core technology and patents being monopolized by foreign countries, the initial stage of development was extremely difficult. The international giants took the initiative to abandon the low-end market, and domestic LED companies began the process of accumulating “primary capital”. As the government increased the support of the LED industry and the huge domestic demand market, China's LED industry gradually developed and improved.

As an important branch of the LED industry, China's LED display industry has developed over the years, the technical level has been continuously improved, and the scale has been continuously expanded, and a series of gratifying achievements have been achieved. After years of high-speed development, the LED display industry is facing more and more problems, such as product homogenization, disorderly competition, price war, and low industry concentration. These unfavorable factors have seriously hindered the healthy development of the industry and increased LEDs. The risk of screen enterprises.

With the growth of the LED display industry slowing down year by year, the domestic market is a "red sea", and many LED screen companies have turned their eyes to the vast overseas market.

According to the data provided by China Optical Optoelectronics Industry Association LED Display Application Branch (hereinafter referred to as the Association), the annual export volume of China's LED display industry in 2009-2013 was 1.628 billion, 2.02 billion, 2.6 billion, 2.85 billion, and 3.1 billion. The above is only the data obtained by the member companies of the industry association statistics, and the actual export value will definitely be even larger.

According to GSC Research's industrial monitoring data, the total output value of LED industry in Guangdong Province in 2014 was 346.06 billion yuan, a year-on-year increase of 23.09%, and the industrial scale ranked first in the country.

Among them, LED display accounted for 8.31% of the total output value, reaching 28.753 billion yuan, ranking the fifth in each LED segment.

In terms of exports, the export value of LED display in Guangdong Province in 2014 was 14.433 billion yuan, a year-on-year increase of 30.58%. After LED lighting products, it is the second largest LED product in terms of exports.

On the one hand, the domestic market is becoming saturated and the smoke is rolling, and on the other side is the overseas “big cake” that seems to be at your fingertips. Based on the reality of the overseas market, many LED screen companies have opened the “export model”. In order to share a piece of cake. What are the reasons behind LED screen companies' choice of export?

1. The overseas market is vast

LED display applications are widely used, and there is a broad space for development in the world market. At present, China's LED display companies mainly export to Europe, America, Japan, South Korea, Southeast Asia and other places, but there are still many markets to be developed in the world, such as the BRICS countries represented by Russia, India, Brazil, the international expansion space is very Big.

According to statistics, in 2013, the total sales of LED display industry in China reached 27 billion yuan, and the total export value was about 4.5 billion yuan, of which the export value of LED display was about 3.2 billion. The global LED display market this year was 13.7 billion US dollars (about 84.9 billion yuan), about three times the total sales in the domestic market. In the same year, Barco and Daktronics had annual sales of 1.158 billion euros (more than 9.96 billion yuan) and 518 million yuan (more than 3.2 billion yuan).

It can be seen that there is still a lot of room for growth in the export of China's LED display industry. The overseas market of RMB 60 billion is worthy of deep penetration by LED screen enterprises. It can avoid the fierce domestic competitive environment, reduce risks, and have sufficient profit margin to support the rapid development of export-oriented LED screen enterprises.

2. Cost advantage Technology development Policy promotion

From the perspective of the LED display industry, domestic enterprises have certain cost advantages over foreign companies, mainly due to the cheap domestic basic materials and the government's VAT refund policy for supporting industries. Although the domestic LED display price is about 30%-50% of the foreign similar products, but the cost of domestic LED display is only about 30% of foreign countries, the cost advantage not only keeps the product better.

The gross profit margin (the gross profit margin of LED display overseas export products is generally about 20-30% higher than the domestic market), and has greatly improved the competitiveness of domestic products.

In recent years, driven by national export policies (such as raising the tax rebate rate), domestic LED display exports have shown a steady upward trend, and a certain export scale has been formed. With the continuous improvement of the technical level, the quality of domestically produced LED display products has been close to the international level, and has a certain international market competitiveness. In the scope of downstream applications, China's LED display screens have frequently appeared on the world stage in recent years (such as the World Cup in Brazil and the Winter Olympics in Sochi, Russia), which can meet the needs of high-end applications such as sports events and large-scale exhibitions, and similar products abroad. The gap is small. In addition to special high-end projects, in most cases, domestic LED display enterprise products can meet the requirements of foreign customers.

3. The domestic market is fiercely competitive. The triangular debt problem is serious.

At present, there are many problems such as overcapacity, product homogeneity, disorderly competition, price wars, and capital chain breaks in the LED display industry. The industry is facing a new wave of shuffling, and the big waves and sands of the superior and inferior are imperative. In order to survive and develop, some LED screen enterprises take the initiative to avoid domestic competition and switch to export, which is also a breakthrough strategy.

In addition, the triangular debt problem has been more serious in the LED display industry. The customer defaulted on the payment of the LED screen enterprise, the screen enterprise defaulted on the payment of the raw material supplier, and the first-level level passed up. An industrial chain has become a risky debt chain.

In order to occupy a place in the fiercely competitive market, enterprises will not hesitate to fight for service, fight for the payment cycle, fight the price, the price war will lower the profit, and make the book capital turnover is not working; and the payment cycle is likely to lead to the break of the capital chain of the enterprise. Bringing the enterprise into a land of eternal annihilation.

LED display export feasibility analysis

In recent years, some LED display companies in China have implemented many large-scale engineering projects at home and abroad (such as the 2014 World Cup in Brazil and the Winter Olympics in Sochi, Russia). These cases directly reflect the comprehensive strength and professional capabilities of the company. Enhance the international community's awareness of China's LED display brand. Although China's LED display companies still have a large gap with the international first-line brands in scale, they still have strong competitiveness in the international market due to the central price and excellent performance.

At the same time, after the domestic LED display enterprises experienced transformation and upgrading, very few excellent enterprises re-adjusted the industrial structure by virtue of capital, scale, technology and brand advantages, and established their own differentiated competitive advantages in specific market segments. Some LED display companies will focus on export business and have high-end LED displays in overseas markets, and have achieved good results.

In terms of technological innovation, the overall technical level of China's LED display application industry is basically synchronized with the international development, new products are constantly coming out, technological innovation in the industry is active, and product technology development capabilities are continuously strengthened. Technology development, technical support and technical assurance capabilities to meet specific application needs have been enhanced, and key technologies and mainstream products have matured.

At present, the overall technical innovation direction of LED display application industry mainly focuses on large-screen intelligent control, high-density display new product development, special opposite-sex LED display application engineering design, LED display application expansion products, product reliability, energy saving and so on. Future professional and technological innovations will continue to deepen and enhance in terms of high performance, high reliability, low cost and low power consumption.

Under the background of continuous innovation and deepening of technological innovation, the research and development of small-pitch LED display products in China has made breakthrough progress. With the small-pitch products, the national LED display industry has completely stood at the top of the global LED display industry chain.

As the driving force to promote the rapid and rapid development of the LED industry, new technologies have always been valued by LED companies. According to the association's data, Lianjian Optoelectronics, Chau Ming Technology, Liard, Alto Electronics, Lehman Optoelectronics accounted for 4.02%, 3.54%, 6.22%, 10.44%, and 7.6% of the R&D revenue in 2013, respectively. There is room for improvement in the investment. Technological innovation has improved the international competitiveness of products, and at the same time created conditions for obtaining abundant export profits. Liad’s orders for overseas military fields totaled nearly 100 million yuan in 2014, and were also approved for military quality management system standards. Explain this.

In terms of intellectual property rights, the awareness of patent application and protection of LED display companies in China is gradually increasing. In 2013, among the 145 companies surveyed and reported by the Association, 855 patents for inventions, appearances and utility models were applied, 77 software copyright registrations were obtained, and 47 new authorized trademarks were obtained. By the end of 2013, the accumulated 145 member units had obtained 2,671 invention patents, utility models and appearance patents, including 585 appearance patents, 1766 utility model patents, and 320 invention patents; the software copyright obtained It reached 490 items; nearly 500 authorized trademarks were obtained. This also marks the gradual strengthening of the awareness of patents in domestic LED companies, and the good situation of actively promoting patent layout is taking shape.

In order to open up overseas markets, domestic LED display companies need to enhance their competitiveness, not only need to lay out the technology and market, but also need to lay out patents, participate in technology research and development, and form our own patents. It can avoid the patent barriers of foreign companies, reduce the risk of patent disputes, and help LED display companies to better explore overseas markets.

Although the gap between China's LED display products and international brands has shrunk significantly in recent years, it has frequently appeared in major international events and events, accumulated rich engineering experience, and the technical level has been continuously improved, and achieved good results. However, China's LED display industry exports to overseas products, the number of independent brands appearing is not much, most of them are still in the form of OEM, OEM and other foreign companies.

In the international market, the brand of LED display in China is still not prominent. How to transition from “Made in China” to “Made in China”, then to “Created in China”, to realize the great turnaround of national brands, LED screen enterprises need to be deeply cultivated in the market. Unremitting efforts.

The LED display market is vast overseas. In addition to major export markets such as Europe and the United States, LED emerging markets are also promising. For example, the BRICS market represented by Russia, India and Brazil, and the Middle East represented by the UAE, Israel and Saudi Arabia. Even in Latin America, represented by Mexico and Chile, Africa represented by Nigeria, etc. These emerging markets are different from the traditional Western markets. The local LED industry in emerging market countries is often not mature. This is China's LED display company. Exports and local conditions provide a foothold.

LED display exit threshold

Although the overseas market for LED displays is vast, there are also many challenges. First of all, China's LED industry started late, intellectual property awareness is weak, patent application and protection work is lagging behind, making China's LED display companies lose their initiative in the international market, and they are likely to be in a passive position in the face of fierce competition. Secondly, the development of LED standards in the world has been quite large, and its system is relatively mature and perfect, and is basically in sync with the development of the market. The introduction of China's LED standards is relatively backward, which also brings a lot of trouble to product exports.

LED displays have to be exported overseas. There are two basic thresholds that must be crossed. One is quality and the other is technical certification.

1. Product quality and service quality

The LED display industry is not a traditional "cheap product export and low-cost competition industry", but "high-priced products and quality competition industries." When it comes to quality, the quality of products exported to overseas must be guaranteed. Otherwise, it is difficult to pass export verification. It is not a glorious thing to be forced to recall the quality. Excellent quality is a prerequisite for products to seize market share, otherwise everything is empty talk. For European and American customers, product quality ranks first, because their definition of products is medium to long-term use, whether it is rental or fixed installation of LED display. Even in some countries that pursue the second best price, the quality of the products should be excellent, because LED screen enterprises rely on products for development, responsible for product quality, win customers' favor and reputation, and on the other hand generate more repeat customers. On the other hand, it has also established a better brand image.

Quality not only includes product quality, but also service quality. The after-sales service is the weak link of China's LED display export. The quality of after-sales service and the timeliness of after-sales service reflect the importance that the company attaches to the customer. Timeliness is an important part of after-sales service. Timely and effective after-sales service can improve the satisfaction of overseas customers to the company or products and create a sense of trust.

For after-sales service problems, people often enter a misunderstanding. They feel that after-sales service is the corresponding repair work after the product is damaged. However, this is not enough. To achieve the quality of after-sales service, enterprises still need a whole set of after-sales service system to support .

In order to better improve after-sales service, major LED display companies should formulate appropriate strategies based on their actual situation. Pay attention to after-sales service, win the trust and recognition of overseas customers with good service quality, customer satisfaction, and repeat customers naturally will be more and more.

2. Domestic and international product safety standards and certification

In recent years, China's LED display related policy standards have gradually improved, and the LED display industry has begun to implement new mandatory safety standards. According to the release of China National Standardization Committee, China's new mandatory standards for LED display products GB4943.1-2011 "Information Technology Equipment Safety Part 1: General Requirements" will be implemented from December 1, 2012, replacing the old standard GB4943 —2011. At the same time, CCC certification is mandatory in terms of certification.

The LED display is exported to foreign countries. In addition to complying with relevant domestic product safety standards and certifications, it must also comply with product safety standards and certifications of the country or region where the product is exported. Different countries have different standards, LED screen enterprises to identify their own product positioning, but in any case, must strictly implement the product performance, quality, reliability in accordance with the export standards, do a good product, quality assurance, this The general direction is unchanged.

If you want to enter the US market, the product safety and performance specifications must meet local standards, and must have independent, accredited third-party testing agencies issued test reports. In the United States, in addition to the FCC is compulsory certification, other certifications such as TL, UL, Energy Star are voluntary, but as an LED display export company, must be treated as mandatory certification, so that products can be less constrained , has a broader market space.

If the export location is Europe, then the product must comply with CE requirements (CE is compulsory in Europe), mainly to prevent new trade barriers. Before any product in Europe is put into the market and put into service, the CE mark must be posted on the product to declare that the product complies with all new EU directives. In addition, Europeans pay great attention to packaging, so packaging must be done well, and there are special packaging standards in Europe.

If the export destination is in other international markets, such as the Middle East, the certification requirements will be lower, which requires LED screen companies to position their products according to the export location before exporting.

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