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The furniture retail industry is primarily driven by dealers, making it essential to address the current industry challenges by effectively managing relationships among all stakeholders to achieve mutual benefits. At a recent home distribution industry development forum, the Secretary-General of the Suzhou Furniture Industry Association provided insightful analysis on this issue.
**Dealers' "Sandwich Layer" Position**
(1) **Relationship Between Furniture Stores and Distributors**
At the heart of the relationship between stores and dealers lies the issue of rent. Dealers aim to minimize rental costs, while stores seek to maximize them, creating an inevitable conflict. This tension is especially evident in first- and second-tier cities, where many dealers are leaving due to rising costs. However, despite these contradictions, both parties can coexist and even thrive if their interests are balanced through open communication and fair treatment. Dealers also need to leverage hypermarket promotions to build brand awareness and generate more profits through effective distribution strategies.
(2) **Relationship Between Factories and Distributors**
Factories typically focus on expanding their dealer network, as more stores mean greater product distribution and faster revenue. However, dealers are now more selective about which brands and products they carry, as the market has become highly competitive. Many dealers struggle to make profits, leading to cautious decision-making when opening new stores or selecting products. This creates a subtle but significant contradiction within the supply chain.
(3) **Relationship Between Factories and Stores**
Previously, the relationship between factories and dealers was less intense, with dealers handling most of the business. However, some hypermarkets now collaborate directly with factories, pressuring dealers to stock specific products without sufficient support. As a result, dealers find themselves caught between two powerful forces—squeezed from above and below. They face a dilemma: not opening a store means no income, but opening one may not guarantee profitability, and failure to meet factory expectations could lead to being phased out.
(4) **Relationship Between Stores and Consumers**
Consumer satisfaction is the key to success for furniture stores. However, promotional campaigns often confuse customers, with unclear delivery responsibilities between factories and dealers. Despite aggressive marketing, many consumers remain skeptical, especially after high-profile incidents like the Da Vinci scandal. This distrust stems from unscrupulous practices and cutthroat competition within the industry. To restore trust, the sector must work together to curb unfair competition and create a more transparent and consumer-friendly environment.
**Challenges Faced by Dealers**
One of the biggest challenges facing domestic furniture dealers is a lack of innovation and courage to change. Many still operate under a "safe" mindset, sticking to traditional methods of opening stores in convenient locations. While this approach may have worked in the past, it’s no longer sustainable. The saying "a rich country must expand its territory" applies here—just as a nation grows by expanding, furniture dealers must evolve beyond their comfort zones. Fear of challenges and reluctance to adapt will only hinder long-term growth.
**The Path to Reform and Development**
To move forward, dealers must embrace the role of a "knowledge-based" professional. Just as personal growth relies on continuous learning, the furniture industry requires a deep understanding of market trends, customer behavior, and operational efficiency. By cultivating a culture of knowledge and innovation, dealers can elevate their businesses and contribute to the overall progress of the industry. It's time to shift from merely sustaining a livelihood to building a lasting and successful career.