On October 10-16, 2022, Construction Machinery Today carried out the "Survey on the Survival Status of China's Construction Machinery Agents in the Third Quarter of 2022". The sample covers all provinces and regions except Hong Kong, Macao, Taiwan and Tibet.
From the regional, brand and level distribution of the sample of agents surveyed, it can basically reflect the current situation of the agency channels in China's construction machinery industry at this time point after the end of the third quarter of 2022.
Profit status of agents
28.41% of enterprises suffered serious losses
From the analysis of the survey results, in the third quarter of 2022, 76.52% of the agent enterprises were in a loss state, and only 23.48% of the agent enterprises were in a marginal or profitable state. Compared with the survey results in the second quarter, the number of enterprises in loss increased slightly, and the loss area increased by 3.90 percentage points.
However, the number of enterprises that can operate normally only through subsidies from host manufacturers continued to increase (from 47.62% in the second quarter to 48.12%), and the number of enterprises with serious losses increased (from 25.00% in the second quarter to 28.41%).
On the whole, in the third quarter of 2022, the profitability of the agent group has deteriorated slightly due to the market downturn and vicious competition. The overall loss is still close to 80%. Considering the survivor bias, the actual loss may exceed 80%.
We will divide the investigated agents into six categories. The first category is the enterprises with profit and market share growth. These enterprises are in very healthy condition, accounting for 4.33%, 4.56 percentage points less than that in the second quarter; The second category is the enterprises whose profits and market share have declined. In order to maintain their profits, the sales volume has shrunk, accounting for 11.92%, 1.24 percentage points less than that in the second quarter; The third category is the enterprises with the same profit and market share, accounting for 7.22%, 1.89 percentage points higher than that in the second quarter; The fourth category is the enterprises with losses and rising market share, which carried out strategic loss layout, accounting for 17.28%, 3.90 percentage points less than that in the second quarter; The fifth category is enterprises with losses and a flat market share, accounting for 20.98%, a slight decrease of 1.21 percentage points compared with the second quarter of 2022; The sixth category is enterprises with losses and declining market share. Their operations are already very dangerous and need to be paid more attention, accounting for 38.26%, 9.01 percentage points higher than that in the second quarter of 2022. The latter two groups of dangerous agents increased by 7.8 percentage points in total, accounting for nearly 60% in total. It is necessary to arouse the colleagues of agents in the industry to be vigilant about their own operating conditions.
46.25% of agents
There are buyouts of varying degrees
At the end of the third quarter of 2022, 53.75% of the agents did not buy out, 9.35 percentage points less than that at the end of the second quarter. In the short term, the distribution of the channel end at the end of the third quarter is increasing, and it is expected that this trend will continue until the middle and late November 2022.
The main reason why the overall buyout of the industry channel has intensified is that the new machine inventory of the non road country's three emission standards must be converted into the channel's two mobile phone inventory before switching to the non road country's four emission standards on December 1, 2022, which is the most critical influencing factor in the next month or so.
The number of enterprises that bought out less than 50 machines in stock increased, from 32.14% at the end of the second quarter of 2022 to 36.25%; Purchase of 51~100 units also increased, from 1.79% to 5%; The proportion of enterprises that bought 100~200, 200~300 and 300~400 stock machines increased by 1.56 and 0.31 percentage points respectively. There are even agent enterprises that have bought out 400~500 sets, but the proportion is only 0.13%.
The accumulation of buyout machines on the channel side will increase the operating pressure on time and space on the channel side in the short and medium term, and may even have a worse impact on hedging demand in the first quarter of 2023, and even affect the sales of new machines in the first round of peak season next year.
Slightly improve the defective area of small excavation
The competition in the price war of Zhongda Digging continues to intensify
In the third quarter of 2022, 88.41% of the surveyed agents suffered losses in small sales, a decrease of 1.11 percentage points from the second quarter; 48.28% of the surveyed agents lost money in sales, 6.38 percentage points worse than that in the second quarter; 4.05% of the surveyed agents lost money during the sales boom, deteriorating by 0.48 percentage points.
Business status of the agent
The challenges remain enormous
In the third quarter of 2022, 81.25% of the investigated agents' business declined significantly, 61.25% and 57.5% of the agents' profits declined sharply and the overdue rate of user repayment increased significantly, and the proportion of the above three points decreased by 6.85, 4.23 and 2.02 percentage points respectively compared with the second quarter.
Influenced by the epidemic situation and the lower reaches of customers' equipment funds, the process of bottoming out the downward cycle of China's construction machinery excavator market continues. In the fourth quarter and even in 2023, the business pressure of the agent group will not be fundamentally relieved in the short to medium term. The majority of colleagues should be ready to meet the "cold winter coming" and resist the baptism of "cold" and "crisis challenges".
Cash flow status and risk control
It is the most anxious problem for the decision-making level of agents
From the point of view of the most anxious core issues of the agent decision-making layer, the four most stressed levels of the agent enterprise at the current stage are the cash flow status, risk management and control, enterprise business strategic layout and market share assessment. Compared with the second quarter, in the third quarter of 2022, the selection weights of agency enterprise risk management and control, business strategic layout and human resource management increased by 5.71, 0.83 and 0.06 percentage points respectively.
There is no doubt that how to strengthen and improve the quality of risk management and control, adjust the business strategic layout, and then deal with further difficult challenges are the key issues that the decision-making level of agents pay more attention to.
Average layoff of agents in the third quarter
Specific gravity is 10.10%
In the third quarter of 2022, 69.1% of agency enterprises continued to adjust their human resources. The number of layoffs increased by 6.6 percentage points, with an average layoff ratio of 10.10%, 3.64 percentage points higher than that in the second quarter; 30.9% of the agent enterprises did not actively adjust their human resources; In addition, there is no agent enterprise to expand human resources, which is 1.39 percentage points lower than that in the second quarter.
Outlook: the proportion of short-term transformation leasing will increase
Medium term focus on active integration
According to the feedback on the future development of the agents, 38.75% of the agent enterprises choose post transformation market services. Compared with the survey data in the second quarter, the proportion has increased by 0.65 percentage points; 27.50% of the agency enterprises chose diversified operation, with a decrease of 4.64 percentage points; 18.75% of the agent enterprises chose to actively carry out integration and merger, with the proportion increasing by 3.27 percentage points; 10.00% of agents and enterprises transformed into lessors, with the proportion increasing by 6.43 percentage points; Another 1.25% of the agency enterprises chose to quit, with a decrease of 1.13 percentage points.
The proportion of the agent enterprises in the transformation of leasing has increased by 6.43 percentage points, and renting and selling has become an important way for some agents to expand sales and achieve the minimum share. The proportion of agents who took the initiative to integrate, merge and reorganize has increased by 3.27 percentage points, which means that agents with relatively strong strength and stable operation have begun to seek the "target" of merger and integration. They will lead the next round of construction machinery agents to accelerate their development again, and will also grasp the channel network with more channel competitiveness.
In addition to leasing business, agents engaged in diversified operations have gradually expanded into project contracting, engineering construction, provision of comprehensive complete equipment solutions, synchronous development of the front and rear markets, training business, research and development of electrified intelligent 名媛直播, sales and services of electric vehicle agents, mining contracting and other business fields.
How to spend the cold winter in an industry with epidemic disease? The author will share with you some valuable suggestions from Sun Changxin, an industry expert and special columnist of today's construction machinery: stick to the industry and serve 20% of high-quality customers; Try new tools, such as Tiktok, short video and live broadcast; The operation system established in the downturn is useful; Determine a red stop loss line; Manage cash flow; Keep a good attitude, no one is luckier than others; With our employees, customers, suppliers, shareholders and other partners, we will accompany with our hearts and enable us to move forward!
The above seven points, I think, are very important without any difference between the pros and cons. But sixth, it may be particularly important to maintain a good attitude and understand that everyone is a "wet runner" in the industry and economic environment. No one is luckier than anyone else.
The cold winter is coming. The newspaper group is warming up. Patience is more important than ambition. It is hoped that the quarterly "Survey on the Living Conditions of China's Construction Machinery Agents" carried out by Today's Construction Machinery magazine and China Construction Machinery Market Research Center can provide some valuable decision-making reference information and confidence for the majority of industry colleagues, especially the group of construction machinery agents who are still persevering and struggling
