Meng Qingyun: LED display industry

[Source: LED Engineering's "LED Research Review" magazine May issue of text / Meng Qingyun] Following the successful listing of Lehman Optical, many LED companies are like to play with blood, like excitement, advance to the IPO, LED industry thriving scene .

Recently, several LED companies suddenly withdrew their orders from the IPO, which is tantamount to giving the impact of the listing, especially the LED display companies.

Immediately afterwards, Dalian Luming who withdrew the bill had a problem of wage arrears. In addition, I heard that an LED display company was unsustainable in the past few days. In my opinion, this is a relatively stable enterprise... It’s weird. LED industry.

The LED display industry has developed to a very prosperous degree, which is a blessing for the LED industry. It has played a leading role in the driving of the entire LED industry.

A LED display company can achieve a production value of over 100 million yuan in just 2-3 years, which has a great relationship with the large amount of capital flow and large demand. Even today, the gross profit margin of display products has fallen sharply. The absolute value of profits is still very impressive.

LED display business operators have no desire for capital, but the best way out is to go public, because only the money from the listing circle can not be returned.

When capital and national policies give high hopes to the LED industry, LED companies, especially LED display companies, are indeed a fragrant.

In today's LED industry, is there a few segments that can exceed the LED display? Even if a company does not have high technical research and development capabilities, and does not have enough patented technology, it is recognized that engaging in assaults, so there is a strange phenomenon: a company's patents are concentrated in a certain period of time.

China's IPO review is also recognized? And the people have a lot of doubts and can meet. “The review is a feature, and the listing is in line with the development of international LEDs.”

The capital of LED is passed on to the investors. It is really a good thing to turn from a serious disease concentrated in a LED company to a small disease that the shareholders share.

The LED display is an engineering product with a certain general technical content (I am talking about general technology, that is, it can be found in the market, not unique to the company).

Due to the existence of many control system companies such as Depuda and Lingxing Yu, and the emergence of wholesale cell board enterprises and the wholesale of cabinets, the threshold for entering the LED display industry is extremely low, resulting in product profit margin. The continuous decline has caused LED display companies to fall into the trap of capital, which is the main reason for the pressure on LED display companies.

On the other hand, LED display companies have erupted in a short period of time (less than 10 years), and the development consciousness, management awareness, and management capabilities of business owners are seriously out of touch with the development of enterprises.

Since then, once the enterprise has embarked on the road of large-scale operation, with the increase of enterprise personnel, the increase of equipment and the increase of expenses, management chaos often occurs internally, resulting in high management costs and personnel expenses, which makes the company's net profit insufficient. In order to meet the consumption of internal management, business owners can't make ends meet. This is the most fundamental reason why LED shows the pressure on enterprises.

Why do LED display companies maintain a certain amount of shipments and a certain amount of orders every month?

The amount of money a company defaults on a supplier is generally 30 days, 60 days, 90 days, 180 days or even longer. If the company does not have enough order to maintain, the company will not be able to purchase a certain amount of raw materials from the supplier without a certain amount of money every month. It will bring a negative psychological pressure to the supplier and will be returned every month. Suppliers pay for the goods, so the company must have a certain amount of business to support the supplier's virtuous cycle of procurement and repayment.

However, the amount of arrears will continue to grow with the increase of business volume, and the arrears will be as big as snowballs. If the company reduces the purchase volume for several consecutive months, and the repayment cannot be timely, the supplier It may be out of service, so the business is in danger.

Several LED display companies that have closed down are good "examples", which is the third insurmountable obstacle for LED display companies at this stage.

There is also a strange disease of order payment.

Orders for LED display companies generally use prepayments plus pre-examination inspections and premiums. Advance payment can be received by the general enterprise, and the latter two are not necessarily. Let's take a look at the contract announcement signed by Alto Electronics and China Xinhua TV. You should know that if the order payment is not received, then the LED display company will use a lot of screen profits to fill it.

Stop here, the LEDs that are hard to return show when and how can companies have a way out?

The fire of IPO is getting smaller, and the road of LED display enterprises is still very long and long. Enterprises without R&D strength will eventually be eliminated by the market.

Enterprises and their capital on the road to go further and further, it is better to calm down to summarize the previous merits and demerits, improve yourself, explore emerging markets, focus on breakthroughs, explore how to get out of the predicament, get rid of the annoying crux!

The door to the market is always open to the first mover.

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