Upgrading Of Chaozhou Sanitary Ceramics Industry: How To Replace The 80 Billion Smart Toilet Business Domestic Alternative?

In 60s twentieth Century, the American Arnold Cohen invented the smart toilet lid with washing and drying. But in the early days, because the topic was considered too vulgar, the smart toilet was refused to advertise in the United States, and the product was once unsalable.

In the next more than 50 years, smart toilet has been introduced into Japan, and has entered the market through ToTo and other brands. While the popularity rate is rising, the technology content in the smart toilet is also improving. In the late 90s, smart toilet products became more mature and began to enter China, while Chinese tourists went to Japan to buy toilet seats.

Despite more than 20 years of development, smart toilet is still in the product introduction stage in China. The overall penetration rate is quite different from that of Japan, Korea and the United States. As of 2016, the number of smart toilet market in China was about 5 million to 6 million units. The market penetration rate was about 1%, and the penetration rate of large and medium-sized cities such as North, Guangzhou and Shenzhen was about 10%. Over the same period, the popularity of smart toilet market in Japan has exceeded 80%.

In the industry's view, low popularity and immature mental consumption mean huge potential increments. Especially in the wave of smart home, smart toilet has become a potential bathroom subdivision. The third party report shows that in the past five years, the domestic smart toilet market has increased from less than 10 billion scale in successive years, or will exceed 60 billion yuan in 2019. By 2020, the overall scale will reach 80 billion yuan.

From the perspective of the whole industry chain, the smart toilet made in China is gradually rising, both in terms of quality and market space. Among them, Chaozhou relies on the advantages of traditional folk porcelain and bathroom to become the representative of domestic instead of awakening.

Transformation and upgrading of Chaozhou ceramics industry

In March 2018, Questale, a well-known market research firm, released a detailed assessment of the global smart toilet sales market trend, showing that global smart toilet sales will grow by 20-45% annually. Among them, the pull of China's market growth has a considerable relationship. The development prospect of China's intelligent toilet market is unanimously optimistic by the industry. Many well-known enterprises such as millet, Haier, Mei, NetEase, Antai and submarines have crossed the border.

After 2015, hemorrhoids drug brand Antai announced the launch of smart toilet lid; Xiaomi also built smart toilet cover and integrated machine; air conditioning enterprise CHIGO also started the investment promotion plan of smart toilet special store. In addition, NetEase's strict selection, advantage technology, TCL, Xiao Pu and so on have entered the Bureau, and intelligent toilet manufacturers have reached several thousand from the very beginning.

At present, China's smart toilet industrial belt is mainly located in Taizhou, Foshan and Chaozhou. Among them, the Taizhou intelligent toilet industrial belt mainly produces electronic components, and the Foshan smart toilet industry belt brings together brand enterprises such as Wrigley and HeGII. Chaozhou is transformed from a traditional ceramic toilet to an intelligent toilet, thanks to the developed local ceramic manufacturing industry. It not only accepts the production orders of smart toilet in Taizhou and Foshan, but also relies on the rapid development of the brand in the past two years.

Chaozhou has a long history of ceramic production. It is one of the birthplaces of ancient porcelain and ceramic culture in China. Unearthed relics show that Chaozhou had pottery production as early as 5000 years ago in the Neolithic age. Chaozhou kiln ruins, a huge Beacon Hill, is one of the 21 ancient porcelain kiln ruins of national key cultural relics protection units.

The ceramic industry in Chaozhou has already formed a large ceramic industry cluster in China. There are about 4000 ceramic production enterprises (including industrial chain related enterprises) and more than 250 thousand employees. In 2018, the total output value of Chaozhou ceramic industry exceeded 50 billion yuan, and 350 of the above scale ceramic industrial enterprises.

By 2017, there were more than 800 sanitary ceramics production enterprises and more than 200 supporting production enterprises in Chaozhou, of which 87 were upper scale enterprises, and the total annual output of the production areas was about 80 million, with an output value exceeding 10 billion yuan. Over the past more than 10 years, the total production of building and sanitary ceramics in Chaozhou has accounted for 40% of the total output of the country, and the export volume accounts for about 45% of the country's total output. Among them, the annual output of intelligent toilet is about 1 million sets, the annual output value is about 2 billion 400 million yuan, the annual output of intelligent toilet is about 13 thousand sets, and the total value of exports is about 38 million yuan.

But in the past, toilets produced in Chaozhou only sold through the export and other channels to the whole country and even the whole world, and there was a lack of brand awareness. Huang Huansen, chairman of Chaozhou Tao Wu Technology Co., Ltd., told reporters on twenty-first Century economic report that in the past, there was no big brand competition among Chaozhou brands, and the establishment of Tao House brand was the hope to integrate the advantages of producing areas and use the operation of e-commerce platform to achieve the goal of regional brand integration.

Digging the sinking market by way of e-commerce

Guangdong Meng Jia intelligent kitchen and bathroom Limited by Share Ltd is one of the suppliers of ceramic houses. Cai Xinyan, general manager of the company, told the twenty-first Century business reporter: "the smart toilet products produced by our factory are exported to Japan, Europe, Australia, the United States and other countries, with the largest number of them in Australia. The past partners were not Chaoshan local brands. Compared with local brands such as Tao Wu, there was no pressure to communicate. I know a lot of brands and enterprises that do business, and they start from scratch. Slowly follow up some rules of Tmall platform and make adjustments according to their requirements. Similarly, they will ask our enterprises to make changes, which is actually the same rhythm.

Huang Huansen said: "now we still want to pull up the overall volume by contacting the electricity supplier. In fact, we are doing the domestic work in recent years, but our mode is still more traditional. For example, by participating in domestic exhibitions, such as Shanghai exhibition, Canton fair or even some overseas exhibitions, the current mode is still partial to traditional and heavy assets, so if we can make use of the new business mode of the Internet, we still hope to form a brand advantage through the combination of new retail, online and offline.

In fact, in recent years, smart toilet sniping and sinking market has also become the development trend of the industry.

Smart toilet in the low line city bathroom market, there are insufficient supply of products, channels and services. As a product of consumption upgrading, the price of intelligent toilet guest is relatively high, which has been popularized in a second tier city for a long time, and it is difficult to really enter the vast sinking market.

In response to such circumstances, Tmall executives told the twenty-first Century economic news reporter that Tmall and other industries, such as Chaozhou, have set up a number of new brands including "Wei Xiao shark" and so on, aiming at the sinking market. During the 618 period of 2019, the sales volume of Tmall's smart toilet increased by more than 60% over the same period, and the growth rate in June 16th was 200%.

Behind the growth, with the rise of the sinking market, smart toilets also have an amazing potential in the low tier cities. Data show that during the 618 period of 2019, Tmall accounted for 49% of the users from the sunken market, and over 50% of smart toilets sold to three to six line cities.

The excavation of the market also puts forward higher requirements for the industrial belt. The smart toilet is mainly about intelligence. For enterprises, the transition from traditional toilet technology to intelligence also requires a lot of input. Cai Xinyan told reporters on twenty-first Century economic report that early smart toilet production and research and development need to invest a lot of money, and only a single intelligent project has invested more than 40 million. However, after the completion of the transformation, the gross profit of the smart toilet is considerable.

"But because many manufacturers did not have mature components and perfect supply chain in the early days, many smart toilet components needed independent research and development and increased their initial cost. But now slowly, there are already some mature parts appearing in the Chaozhou area, and the whole industrial chain is further improving. Cai Xinyan added.