Abnegate Little Gain Little, Abnegate More Gain More
When companies of the LED lighting industry are busy with integration, merger and expansion nowadays, an enterprise is acting in a diametrically opposite way, concentrating its development in a strategically selected field. In the era where companies are chasing for quick success, how does this enterprise keep its originality in the competitive market? What is the company’s counter-strategy for industry price war and oversea competitions?
Shanghai Wellmax Lighting Industry (WELLMAX) was founded in 1987; it was one of the biggest exporters of incandescent bulbs in China, specialized in the research, design, and manufacture of indoor lighting products. With near-30-years of experience in the industry, WELLMAX has made successful business transformation from making traditional lamps to making LED bulbs, and is now recognized as the “LED Bulb Expert” by clients worldwide.
The LED Bulb Expert
When LED technology completely changed the fate of the light industry, it also brought in tremendous opportunities for companies to thrive. Many companies choose to further diversify its product lines in order to gain greater market shares, WELLMAX decided to focus all resources on LED bulbs to deeply penetrate the market. CEO of WELLMAX Wang Yamin explained, "focusing on LED bulb not only meets the company’s philosophy of concentrating on familiar territories, but also brings WELLMAX on a fast track to become a leader in one field, therefore gaining better and more integrated resources to continue to refine ourselves.”
To become a "LED Bulb Expert", WELLMAX has built a complete process management system involving product development and design, supply chain integration, factory management, market analysis, and customer service etc. WELLMAX wins a strong competitive edge in the overseas markets with its unique LED bulb management processes, which is highly praised by professional clients.
Wang Yamin, CEO of WELLMAX
"WELLMAX’s major markets encompass Europe, South America and Southeast Asia. Europe is the biggest revenue contributor. Southeast Asia grows fastest, it is expected to increase by 50% in revenue by 2016 ", Wang Yamin introduced, "At present, the company has formed a 100% LED bulb product structure and will be continuously devoted to the research and development of LED light bulbs in the future."
The staunch supporter of the craftsman's spirit
In recent years, the sales of LED light bulbs increased rapidly with steady market expansion. But as the competition becomes more aggressive with more and more players coming in, many manufacturers are caught in a swirl of price war. Prices of LED light bulbs present a downward trend.
According to the latest price report of LEDinside (LED online), the LED industry research brand under TrendForce, retail prices of LED bulbs replacing 40W incandescent lamps decline by 0.7% to $ 9.5 and that retail prices of LED bulbs replacing 60W incandescent lamps fall by 0.6% to $12.9 in July.
Under the situation that prices continue to drop and corporate profits have been squeezed, many manufacturers are forced to fight with the low-price strategy at the cost of lower product quality. However, there are still enterprises like WELLMAX insistently holding on to their value--high quality, high performance and highly secure product experience.
Wang Yamin emphasized that WELLMAX has been putting quality in the first place, attaching great importance to innovative research and development, vigorously carrying forward "the craftsman’s spirit” and sparing no effort to improve the quality of products.
WELLMAX’s quality control system runs throughout all stages: from raw materials purchasing to producing, assembling, packaging, shipping, and storage management. In addition to standardized quality control for preproduction, production and warehouse storage of goods, it also collaborates with clients and renowned third party such as SGS to monitor quality of products.
WELLMAX has set up a research and development center of LED bulbs in Shanghai, recruiting top engineers to implement specialized design on LED bulbs. Now WELLMAX has more than 20 patents on its proprietary LED bulb products, and every year the company devotes around 10% of the annual revenue into the LED lab.
Team up with SAMSUNG to start new LED "chip" development pattern
In March this year, WELLMAX officially established brand strategy agreement with Samsung LED (SAMSUNG), becoming China's first global partner that receives SAMSUNG’s ingredient brand authorization. Since April 2016, WELLMAX incorporate Samsung LED chips in all WELLMAX LED bulb products.
WELLMAX receives Samsung’s ingredient brand authorization in 2016.
Undoubtedly, this is a win-win strategy. While WELLMAX is opening up the markets for SAMSUNG LED, WELLMAX is also reinforcing its brand image as the LED Bulb Expert. As the Senior Vice President of Samsung Electronics China, Tang Guoqing said, “As the leading brand of China lighting industry in the overseas market, WELLMAX has achieved great success in LED product development. WELLMAX emphasizes brand identity and brand value, which highly coincides with Samsung’s beliefs. We are very pleased to have WELLMAX as Samsung’s first brand partner in China. SAMSUNG will firmly support WELLMAX in expanding global market in products, brand and other aspects.”
Through close cooperation with SAMSUNG, WELLMAX strive to integrate and optimize the core aspects of product design, quality management and the development of technology, and provide products and service with high added-value. WELLMAX also shares Samsung’s experience and achievements in the field of LED lighting technology, and jointly take advantages of technology research and development in the field of LED bulbs.
"Fully adopting Samsung LED chips will inevitably affect the prices of WELLMAX’s products. However, this action brings WELLMAX’s customer with value, and can help them boost product competitiveness”, said Wang Yamin, “It is our pursuit and effort toward customer value and product quality that have attracted many overseas customers.”
Abnegate little gain little; abnegate more gain more. The strategy is about weighing trade-offs. If trying to meet all the needs from everyone, an enterprise will lose focus and end-up wasting resources. WELLMAX is making the best of the abnegating wisdom to make an amazing turnaround.