On the LED lighting business cash flow three reasons

At the beginning of 2012, with respect to this year's LED market conditions, various prediction everyone situation. On comparisons with stubborn resistance in the major institutions and wishful thinking "in 2012, LED market will be in chaos after 2011 ushered in a new starting point," when little known in the industry Shida photoelectric boss actually "a race amazing, "have not had time," sober, "the staff in Chinese Lunar New Year is approaching lost scattered on the plant's playground pay talks home for the holiday, but the industry is in an uproar.
Data show that the number of led street lighting Manufacturer in China is growing at a geometric rate increase exaggeration, perhaps this just in stark contrast with the LED market. "The waves pushed forward waves before the waves beat on the beach," What a heroic scene.
According to the analysis, the most important reason leading to the collapse of Shenzhen Shida is cash flow. But in China over 4000 LED business, how many homes are in such a situation the LED industry had friends joked:? LED industry enterprises have closed down the risk of more and more, even if some companies the upcoming slow the pace is likely to stop in 2012! Cash flow, the company's orders is still there, indicating that the market is still relatively merciful, but so many manufacturers, who had to save this situation?
Cause cash flow problems are the following three points:
A domestic project funds difficult to recover
Finished applications in the field, mostly based on project-based domestic sales. Given LED Products Division fully mature, there will always be more or less about the issue, a direct result of the project money endlessly delayed.
In addition, also another strange. According to insiders, a market price of 4000 yuan of lights, in some projects in the price as high as 10,000 yuan or more, provided that it takes on a series of public relations hospitality, but 10,000 yuan temporarily difficult to fulfill, also take into account a lot of public relations in vain hospitality. Over time, many companies is really no way to play it, and Shida photoelectric is a typical representative.
Second, the market forecast is too optimistic lead inventories
To package and wafer manufacturers, for example. Chinese government's macro-control are often able to play a key role in the market, precisely because of this layer reason, the market is expected to be too optimistic. End-use markets expansion rate compared to the industrial development is clearly much slower pace, sales performance and extension indirect role in the field of packaging factory. Inventory increases come to go get a sale "price war", not sell out called "collapse."
Third, suppliers tight money
LED from international companies in the field of mergers and acquisitions to the mainland manufacturers have to seek listing, we can draw two conclusions: 1, to reduce investment risk; 2, raise sufficient funds.
Risks associated with the shortage of funds in the coexistence of the LED industry, the rate of return on the funds could not impressive, but the time value of money is also very important. Under the lure of high rates of return, industry links seemingly perfect, in fact, a very serious problem of interdependence. In the upstream manufacturers of long-term funds can not be withdrawn from circulation, the downstream manufacturers began to worry about the interests of becoming empty promises, and began tight money. This occurs in any part of the led street light wholesale industry, will lead the industry mentality nervous, so "the boss on foot" became popular in 2011 LED industry keywords.
In view of the above phenomenon, the industry believes, LED industry, SMEs will usher in a new high point of collapse in 2012! But the collapse of the risk is relatively small export-oriented enterprises. It is worth noting: In the LED industry, over the years, 5-7 May is the export season, infer, 8-10 month is the Chinese mainland LED enterprises are facing a high risk of collapse.