Haier Kelon prices huge loss warning.docVIP

 PAGE \* MERGEFORMAT 7 Haier Kelon prices huge loss warning Tsinghua University, Head of Marketing Zhao Pingzhuan text: ‘In a very long time, Haier Electrical Appliances price is higher than about 15% of the domestic like product. In response to fierce domestic competition in the market, since the end of 2002, Haier has gradually reduced the price system is now higher than about 8% of domestic similar products, then the result is found that market share has not achieved expectations in growth. In 2004, Haier invested through new products, and gradually returning to the original price system, and strive by brand, quality, service and other comprehensive capacity-building to win a competitive market advantage ‘. If we say that the impulse to the development of Haier Nan Yi, in the price on the ‘Wanjiebubao’, but go a roundabout. Coincidentally, Kelon has emerged in 2004, huge loss of 64.16 million yuan, the author speculates that perhaps the fault of another price cut! The practice in recent years shows that the price cuts is undoubtedly the household electrical appliance enterprises ‘trump card’, even if companies like Haier have tried the water price cuts. The aim is to profit-maximizing enterprises, Haier has brought lower prices to our thinking is: Haier cut prices so much, to ensure that the original profit, sales growth in the number required? In other words, Haier, price cuts, sales should increase in number, Haier in order to maintain the original profit? Otherwise, Haier’s price cuts are not worth it. Prior to 2002, assuming that appliance manufacturers ‘similar products’ gross margins as high as 21%, then the ‘Haier price is higher than about 15% of the domestic like product’, its gross profit margin was 36%; assumes that the current ‘similar products’ gross margin has been reduced to 10%, then the Haier appliances ‘price is higher than about 8% of the domestic like product’ of its gross profit margin was 18%. According to William. Burgess ‘pricing