Analysis of domestic and international market situ

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Analysis of the domestic and international market situation of BOPP industry and Discussion on Countermeasures (II)

v. coping strategies in the face of the current market situation: in the face of the current severe situation of oversupply, how should the BOPP industry better embark on the road of benign development? In addition to strengthening management, improving product quality and reducing costs, the following aspects should be considered:

(I) accelerating industry restructuring and integration. From the perspective of industry, competition can promote the combination, merger and reorganization of enterprises in the industry. Some small-scale, high energy consumption and low efficiency enterprises will be eliminated, so as to promote and promote industry alliance and enterprise restructuring, and improve the scale and grade of China's production-oriented enterprises. This is beneficial to enterprises with certain economic strength, talents and technological advantages

(II) accelerate the adjustment of enterprise industrial structure. In recent years, China's BOPP material production enterprises, driven by high interest rates, have only paid attention to the increase of quantity, but neglected the improvement of quality and the adjustment of structure. So far, the total production capacity has exceeded the demand, but the product structure is seriously unreasonable. On the one hand, because most of the production lines are introduced in the early stage, their product structure is simple, resulting in low product grade; On the other hand, under the temptation of high profits, some enterprises that have never been involved in the industry blindly follow up, and they did not seriously conduct market research when launching the production line. They are careless in the allocation of production equipment. The products are positioned as ordinary packaging base materials and cannot produce functional BOPP materials with certain technical content. Therefore, competition can promote the industrial structure adjustment of the industry and the optimal allocation of resources, which is the best time for large-scale flexible plastic packaging material manufacturers to develop functional BOPP materials

(III) increase investment in science and technology, promote new product R & D and technological innovation. As BOPP materials have great advantages in mechanical, optical, electrical performance and cost performance, this characteristic determines that the application field of BOPP materials will be continuously expanded. How to adapt to and meet the needs of new fields and markets, we must increase scientific and technological investment, speed up new product research and development and technological innovation, and vigorously develop functional products. Jiangsu Zhongda Group has seen this development trend, and has developed and stored a number of production technologies for high-quality functional new products, such as high brightness smoke film, five layer co extrusion smoke film, five layer co extrusion BOPP all plastic synthetic paper. All these functional BOPP packaging materials will play an important role in the new round of industry development

(IV) strive to achieve branding and enhance export capacity. Since 2002, China's BOPP products have been exported. With the development of the industry and the intensification of competition, all production enterprises have begun to pay attention to the improvement of product quality and the construction of their own brands. At the same time, in order to pursue high profits and avoid domestic competition, all production enterprises are vigorously expanding overseas markets, and have achieved remarkable results in the past two years. In 2002, the export volume of China's flexible plastic packaging materials was only 10000 tons; In 2004, it increased to 28000 tons; In 2005, it reached 35000 tons

(V) have a clear understanding of the external environment and their own capabilities, find their own strategic positioning, and avoid vicious competition

bopp enterprises only have a clear understanding of their own business environment, scientifically formulate their own competitive strategies and take their own path, can they obtain competitive advantages and seek their own space for survival and development. In the choice of strategy, there are three competitive strategies: cost leadership strategy, differentiation strategy and specialization strategy

cost leadership strategy: for enterprises with strong strength, the scale benefit is obvious, the product standardization degree is high, and the cost is much better than that of other enterprises in the same industry, so the cost leadership strategy can be adopted. By means of cost control, we can gain competitive advantage in cost

differentiation strategy: it is a differentiated production and marketing method with small batch, multiple varieties, multiple customers, high sales price and high income according to the differences in users' use and demand for products. By meeting the new requirements and new characteristics constantly put forward by users for BOPP product performance, developing functional BOPP materials to replace traditional products will achieve more significant economic and social benefits for BOPP enterprises

specialization strategy: according to the production characteristics and advantages of the enterprise, a certain variety of BOPP industry is selected for specialized production, such as cigarette film. Compared with flat film, its scale, profitability and customer use mode are very different. Therefore, the strategy of specialization competition can be adopted

(VI) attach great importance to the marketing strategy of cash transactions and strive to reduce financial costs. Enterprises should vigorously advocate the marketing strategy of cash transaction. On the one hand, cash transaction should be regarded as an effective means to avoid the risk of loan withdrawal and ensure the normal operation of funds; On the other hand, we should fully recognize the favorable factors and potential value of cash transactions for enterprises. In order to successfully carry out cash sales, enterprises need support and care from many aspects, such as good corporate reputation, high-quality product quality, perfect after-sales service, standardized contract management, and effective reward mechanism. Cash transactions are not just a way of transaction, but whether the enterprise has the corresponding conditions and how to improve the unmet conditions as soon as possible, So as to promote the virtuous circle of enterprise management, so as to achieve a win-win situation

(VII) focus on centralized procurement of main raw materials in BOPP industry to reduce procurement costs. At present, the upstream petrochemical industry has achieved market and price monopoly, the price of raw materials fluctuates, while the downstream users' demand is not stable, the growth is not fast, and the credit status is uneven. This is one of the reasons why the enterprises are in a passive position. We should fully realize the seriousness of the problem. The BOPP industry should unify its thinking and action, concentrate all forces in the industry, strive to realize the centralized procurement of main raw materials in the BOPP industry, and expand space for the development of the industry. Through the following measures, we can implement the unified and centralized procurement of raw materials. Since the advent of electro-hydraulic servo valves with various structures in the 1960s, especially the emergence of the electro-hydraulic servo valve with dry torque motor as the representative and the use of various electric feedback technologies, the performance of the electro-hydraulic servo valve has been further improved. The electro-hydraulic servo technology is becoming more and more mature. The electro-hydraulic servo system has become a weapon, aviation Aerospace Automatic control is an important part of the automatic control of some civil technical equipment, so as to achieve a real strong combination between upstream and downstream industries

1. Establish a national industry association and a "leading Committee for main raw material procurement" to be responsible for the business negotiation and raw material procurement price negotiation of the upstream petrochemical industry, change the severe reality that the BOPP industry currently has no right to negotiate prices, and guide downstream customers to change their speculative psychology

2. Through the joint proposal of the industry, several sets of petrochemical units with high BOPP production quality and good stability of Sinopec and PetroChina will be concentrated to produce BOPP raw materials, so as to give better play to the effective production of each petrochemical unit, give full play to the advantages of upstream and downstream technical resources, improve the quality of BOPP raw materials, and promote the overall level of product quality in the BOPP industry. At the same time, reduce sales links and purchase costs

3. In the case of relatively concentrated production in the petrochemical industry, establish a convenient and fast logistics mode, adopt the current international advanced and clean tank car transportation mode, reduce the transportation cost, packaging cost (about 300million yuan based on 1.5 million tons), loading and unloading cost, improve the cleanliness of raw materials and reduce transportation losses

4. For the part of domestic petrochemical that is in short supply or cannot be supplied, the whole industry should also cooperate to negotiate with foreign major petrochemical suppliers to strive for reliable supply guarantee and preferential supply prices

(VIII) fully understand the development trend of BOPP and promote the continuous improvement of the overall level of the industry. In the next few years, the production and research of BOPP at home and abroad will show the following development trend. All enterprises should strive to move forward towards this development trend, so as to improve the overall level of the industry

1. Low consumption: reduce the packaging cost and material consumption by improving the performance of BOPP, endowing it with certain functions, reducing the process or reducing the proportion of packaging materials; Through multi-layer coextrusion and blending modification, the state continues to support methods in policy to improve the performance of products to make them puncture resistant, aging resistant and tear resistant, so as to greatly improve the service life of products and improve the utilization efficiency of materials

2. Environmental protection: instead of the packaging method that cannot be recycled and consumes forest resources, the electromechanical used by the tension machine of the company is the renewable and degradable packaging material of Panasonic all digital exchange servo electromechanical generator in Japan. In the 21st century, environmental protection will be a permanent theme of global concern, and it is also a basic national policy for China to implement the strategy of sustainable development. Green products and green packaging will become one of the highlights of the world's scientific and Technological Development in the early 21st century. Degradable flexible plastic packaging materials are gradually expanded from food packaging to non food packaging, and will be further developed in industrial packaging, pharmaceutical packaging, agricultural and sideline products packaging, building materials packaging and marine supplies packaging

3. Safety and anti-counterfeiting: first, the material itself is required not to pollute the packaged goods; Second, the packaging materials are required to have anti-corrosion functions

4. Internationalization of standards: with the integration of China's economy and the world economy and the economic globalization of "internationalization of domestic market and localization of international competition", enterprises strive to design and produce products that meet international standards, and actively strive to adapt to the market trend in terms of raw and auxiliary materials, equipment and sales, so as to better participate in the international market competition under the background of globalization and expand the share of the international market

to sum up, we can see from the future development of BOPP Market: on the one hand, ordinary packaging materials will have excess capacity, prices will decline and competition will intensify; On the other hand, functional BOPP base materials and some differentiated products will be in short supply, and the demand of the domestic market is also growing at an average annual rate of 8-12%. It can be said that threats and opportunities coexist, and the future will be more challenging

July 2006

source: Jiangsu Zhongda New Material Group Co., Ltd

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