Analysis of Russian market trend

In recent years, the LED  lighting market has developed very vigorously in emerging countries, and traditional international brands occupy seats in mature markets such as Europe, America and Japan; under the circumstances that highly competitive countries such as China can see money but cannot make money, developing emerging markets has become An important step for manufacturers to formulate expansion strategies.

With a total area of ​​17 million square kilometers, Russia is the most extensive country in the world; with a population of 143 million, it ranks ninth in the world; and its GDP ranks eighth in the world. It seems that there is a huge market for lighting products. According to Chu Yuchao, an analyst at LEDinside, the total share of the Russian lighting market in 2014 was close to 7.8 billion US dollars, and the  application of LED  products is not inferior to the most advanced countries in the world, with a high market penetration rate of 32%, and it is estimated that it will reach 44 in 2016. % market penetration. Regardless of the growth rate of overall lighting and the penetration rate of  LEDs  , etc., Russia is the most potential area in the niche market.

In addition, the Russian market is different from other emerging market countries. In terms of market dispersion, Russia has a better performance. According to LEDinside's actual visit and verification, more than 60% of Russian outdoor lighting is controlled by specific manufacturers. Compared with other emerging markets, such as Southeast Asia, in addition to major international brands such as Philips and Panasonic, the largest local brands also have at most 30% of the market share of specific field applications. Russia's unique market characteristics require analysts to flexibly apply more models and add more variables when observing the market, so as to obtain objective and highly reliable market information.

According to the observation of LEDinisde analysts, there are many key elements in the entire Russian LED lighting market. Here are three most representative projects:

I. The industrial chain is highly dependent on imports

In the supply chain of LED lighting products, whether it is LED packages, power drivers, or heat dissipation modules, 99% are imported from abroad, and more than 50% of the entire lamp part comes from other countries. In such a huge Given the market demand and lack of a complete supply chain, manufacturers with technology in the Greater China region or in Europe and the United States should better grasp this market and conduct in-depth operations to obtain import partners.

II. The current economic situation in Russia

While the news is reporting that the yen has fallen by more than 17%, the Russian ruble has lost more than 55% of its value this year. The reason for the depreciation comes from the sanctions imposed by Europe and the United States on the Ukraine incident, as well as the effect of the sharp drop in oil prices. However, in this market that is highly dependent on imports, it will lead to an increase in import costs, which will keep the cost of selling local lamps in Russia high. For this reason, LEDinside analysts believe that local companies in Russia are motivated to support local supply chains, and foreign manufacturers with technical expertise can take advantage of this opportunity to establish strategic alliances.

III. Career development is highly dependent on "partnership"

You are facing the Russians, a proud and tough fighting nation. Forget about the business models of "finding customers", "trial production samples" and "early introduction"; what Russians value is not your product or your price, but your "partnership"! How good are you with the government? How good is your relationship with the financial institution? Do you have links with companies supported by national sovereign funds? This is the key to attracting Russians to do business with you. The most important thing is that when the Russians recognize you as a partner, they will never transfer the order easily, but firmly establish a deep cooperative relationship.

 It seems that although the Russian market is large, in-depth cooperation requires hard work. The depreciation of the ruble, the Ukraine issue, European and American economic sanctions, and transportation issues all have to be resolved.

Shenzhen Guangke Lighting Co., Ltd. was established in Shenzhen, China. It is one of the high-tech enterprises in the research and development and manufacture of LED light sources in China. The company mainly serves the field of LED advertising decorative lighting.

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