Is the channel of agricultural materials persistent or Nirvana?

Preface

Profits continue to decline, channels are more and more difficult to manage, the cycle of new product research and development is long, and the slow promotion of new products has become the heart of many manufacturers. For agricultural manufacturers, it is understandable to maintain the existing channels. However, in the Internet era, agricultural e-commerce, transparent information, large households have become the mainstream, industry changes are often between day and night, rather than the previous years count, the crisis and opportunities that will be faced at any time, so that all parties in the agricultural industry feel pressure.

Suffering and unprecedented pressure are the most suitable words to describe the vast majority of agricultural manufacturers at present. Reduced profits, chaotic channels, disordered prices, and weak succession of new products are all challenges. As for dealers, the disobedient management of retailers and the pressure from the flattening policy of manufacturers make many dealers face the pressure of transformation. The release of the zero growth policy of agricultural materials in 2015 has put a ticking time bomb in the agricultural materials market, making all links of the agricultural materials chain hanging their hearts in their throats. In rejoicing that agrochemical enterprises collectively issued an electric shock "prohibition order", e-commerce represented by JD.com, rural Taobao and Dafengshou Agricultural material Mall is still accelerating its entry. There are also representatives of the transformation of manufacturers such as Nuopxin, Huifeng, Kim Jong-da as the background of the field circle, Nongyi Network, Agricultural Merchant No.1, and so on. Although traditional dealers and manufacturers choose to downplay the e-commerce model, and some manufacturers'e-commerce has made people lose confidence, the industry still judges that in the next five years, the agricultural material market will completely subvert the current form of operation. Traditional agricultural manufacturers have only two ways to survive or Nirvana rebirth.

Current situation one: large households are growing up gradually, and the distribution model lacks adequate service support.

With the continuous acceleration and centralization of land transfer, a new type of farmers will also be accelerated, which represents a new type of consumption concept and behavior. Retail farmers do not know how to match because they have always relied on the recommendation and guidance of one group, the owners of agricultural stores. But for large growers, as they grow more and more land and purchase more agricultural materials, they bear more risks than retail investors, and they are more cautious and rational in their choice of agricultural materials. they increasingly believe in themselves rather than others, and they are more and more inclined to buy cheaper agricultural materials directly from superior dealers or manufacturers. These forces force them to accumulate knowledge of agricultural technology and agricultural products, to choose independently, and to inquire independently through the Internet. Their purchasing habits are more in line with the sales methods of agricultural e-commerce.

Therefore, in the case of rising professional requirements for agricultural technology knowledge, dealers have been unable to rely on their own knowledge and experience reserves to serve large growers. For large growers, the platform that provides quality service is the best choice.

Status 2: the profit space of traditional agricultural materials continues to shrink, and the situation of small and medium-sized enterprises is endangered.

According to the report on the cost and profit of compound fertilizer in September, we can see that the cost of enterprises increased slightly and the profit decreased in September. Take urea-based 45%cl3*15 as an example, the current raw material cost is about 1309 yuan / ton, plus 300 yuan / ton production cost, the total cost is 1609 yuan / ton, an increase of 0.56% over the same period in August. However, as the autumn fertilizer preparation comes to an end, the main compound fertilizer enterprises are mainly to clean up inventory, and the center of gravity of the real single transaction fluctuates downward. Based on the fact that some enterprises left the factory at 1700 yuan per ton, the gross profit margin of some enterprises was 5.53 per cent, 1.6 per cent weaker than the same period last month.

Thus it can be seen that the average gross profit of compound fertilizer in fertilizer enterprises has been at a low level. According to the relevant law of economies of scale, only when the output reaches the critical point, can the low gross margin produce considerable profit and maintain the sustainable development of the enterprise. for those small and medium-sized enterprises with long channels, high costs and low sales, they can only hover on the line of life and death.

Current situation 3: the purchasing power of farmers has declined obviously, and the means of promotion are weak.

For the chemical fertilizer market, winter storage not only has a decisive impact on chemical fertilizer sales in the winter of that year, but also plays a connecting role in the production, processing and sales of chemical fertilizer in the coming spring. But in 2015, the winter storage of fertiliser, which was supposed to be launched in mid-to-late October, was quiet near the end of November.

In addition, the new production capacity of urea reached 9 million tons in 2015, which had a great impact not only on the urea market, but also on the entire chemical fertilizer market. Urea prices hit a new low in the mainstream areas in mid-November. Due to less downstream demand, dealers adopt the way of purchasing more, less and more batches, so the manufacturers appear passively. For reasons such as the transfer of grain prices and the lack of enthusiasm of farmers, any promotion activities of manufacturers are extremely pale, which have become an important factor in delaying the opening of the winter storage in 2015.

Thus it can be seen that the excessively high supply, long-term solidified promotion activities and the depressed agricultural product market have triggered a series of reactions, but in the end, it is the decline of farmers' purchasing power and enthusiasm, and the promotion means of manufacturers are difficult to stir up the nerves of farmers.

Status 4: the Internet has become a basic tool, and a variety of choices lead to increased competition.

The popularity of the Internet is not only seen by ordinary people in online payment, online shopping, but also in a series of behaviors such as imperceptibly changing purchasing habits, forms of learning, interactive occasions and so on. For farmers, the Internet enriches alternative agricultural materials and is closer to the upstream, then the competition between prices and brands will continue to escalate, and the advertising bombardment of offline telephone poles, posters and wall advertisements can no longer be reached accurately, while the phenomenon of different prices of the same brand and different prices of different brands will prompt manufacturers to standardize their own pricing and intensify the market competition among brands. Conventional price reduction, buy and send, will only continue to make the industry form a vicious circle, when the new products are not fully accepted by the market, the advantage of traditional agricultural materials as a profit point will continue to weaken.

Both profits, channels and users are constantly developing and changing because of the role of the market, the distribution system is actually a relatively primitive sales situation, which is often willing but powerless to deal with the complex and diverse market environment. In the future agricultural material market, the mode of operation and business form will undergo the following changes.

Trend 1: agricultural e-commerce gather sales faucets, manufacturers touch the network integration will become the norm

The innovation of any business form will follow the basic law, whether it is the distribution system or e-commerce model pay attention to passenger flow (flow). Traditional dealers have jurisdiction over dozens of retailers, and retailers have become the faucets that generate sales, but limited to the physical and service characteristics of stores, individual stores can also serve summary transactions, and logistics functions are also needed. On the other hand, e-commerce can achieve "1-to-N" transactions through the Internet, so it can complete the transaction volume provided by tens of thousands of retail stores on one platform, and the richness of the products is unmatched by retailers. With the large-scale encirclement of Ali, Tian Tian Circle, Big Harvest, Cloud Farm and other platforms, a large number of traditional agricultural stores have become their offline service centers, compared with decentralized and unorganized traditional retail outlets, this kind of service center has relatively strong product and marketing strategy support, so it is bound to reshuffle traditional retailers. This is tantamount to monopolizing the vast majority of sales and exports in the agricultural material market, and the best way out for agricultural manufacturers is to achieve the extreme of their products, and the other is to touch the network and integrate e-commerce.

Trend 2: large households become the mainstream planting group, and agricultural technology becomes a necessary service.

From only 400000 large households in 2012 to more than 3 million households in 2015, we can see that the integration being told by land transfer is in the hands of large growers. As the market for agricultural products-related prices affected agricultural production, but maintained a growth rate of 18.3% from 2013 to 2014, and maintained a growth rate of more than 9% from 2014 to 2015 according to the turnover area of the provinces, the era of large households is not far away.

In addition, there will be the problem of farmers' different medication habits on the other side of the mountain in our country, and the symptoms of the disease may be the same, maybe one will do? But even if the disease is the same, because the soil texture is different from the crop resistance, the drugs used are not the same. In the face of large-scale land with extremely high planting costs, the demand of large households for professional agricultural technology is becoming stronger and stronger, and the form of agricultural belt sales is as routine as seeing a doctor.

Trend 3: the trend of special use of agricultural materials is becoming clear, and the products are more diversified.

The purpose of market segmentation is to achieve greater economic benefits by positioning the differences in customer demand. As we all know, product differentiation will inevitably lead to the corresponding increase of production costs and marketing costs, so enterprises must make a tradeoff between the benefits of market segmentation and the increased costs of market segmentation. In the face of the background of declining profits in the field of compound fertilizer with nitrogen, phosphorus and potassium as the main content, it is possible to enter the market segment, and the agricultural materials applicable to staple grain nationwide have been partially recognized in the market. however, there are still many special agricultural materials for cash crops that have not been developed, ranging from onions, ginger and garlic to citrus, sugar cane and other crops. It can be seen that there is still a lot of opportunity for these crops. In order to obtain high profits, choosing market segments to avoid the Red Sea has become a better choice for agrochemical enterprises, and at the same time can greatly enrich the product structure in the market.

Trend 4: the leading manufacturers achieve the transformation goal, and the golden period dividend disappears.

Today, with the policy and market becoming more and more complex, transformation has become the most common word in agrochemical enterprises. How to transform? What direction do you turn? This is an unsolved question. Today, the main direction of agrochemical enterprise transformation is service-oriented enterprises, e-commerce (self-built platform), borrowing network integration, diversification. If the service type is more obvious, such as Shi Kefeng and e-commerce, we should talk about the cooperation between Australia's Herve and Dafeng Agricultural material Mall, and the diversified business should belong to the farm of Xindu Chemical Industry. Whether this is appropriate or not is another matter. In a period of industry confusion, anything can be magnified by sensitive industry nerves, and the chain form of field circles can trigger intense discussion in the industry. Apart from the publicity, there is more of its bold e-commerce of self-severing arms, which has attracted great attention from capital, industry and farmers. when this transformation becomes normal, the public's attention will not be as focused as it is now. the image of its transformation will be diluted. By 2020, the transformation tuyere of the industry may be closed, such as the field circle, the agricultural network and so on. It can be said that the carp crossing the river is a splendid scene, but it is difficult to build splendor.

Agricultural material is the last position of the traditional business form, and change is an irreversible trend. Whether it is the self-revolution of manufacturers or the impact of outsiders, it is a redemption and rebirth for the old business model. 2020 is also the final ultimatum of the zero growth policy of agricultural materials, which is related to the interests of all parties in the agricultural industry to be able to complete the transformation to meet the changes in the industry.