It is well known that our construction industry profits have been relatively low, which has become one of the reasons for industries. The reason why this phenomenon is caused, why is there any solution, we will discuss it today.
In 2013, the world’s top 500 non-China’s profit margin was mainly due to the loss of the Spanish ACS Group of the year.
From the above picture, the profit level of China’s extra large construction enterprises is much lower than foreign companies in the same industry, and it is much lower than the overall industry level; compared with other industries. China’s construction industry is much lower than that of China’s industrial average, which should be the lowest profit margin in the second industry.
But it is puzzling that although my country’s construction profit has been very low for a long time, its growth rate is very fast, even 2 to 3 times in my country’s GDP growth (these two years is not good Dropped), this is the high profit of the economics of the economics, and the growth rate is fast. Another situation is more unhealthy, such a low profit industry is increasingly increasing, and more and more companies are increasing, but no enterprises have transferred to other industries. Quantity grows rapidly. These years, almost no special, one-level enterprise is closed, and there is also a small number of mergers and acquisitions.
This situation does threaten the healthy development of the industry, the enterprise and associations continue to press this to local governments and competent authorities, requiring to change the list of quotes (reasonable low-cost bids) bidding policy, it is best to return The fixed price system; the Ministry of Housing and Urban-Rural Development is the number of general contracting enterprises, curbing vicious competition, introduces new \”total contractual qualification standards\”, intended to reduce the number of special qualifications. Can a corporate wishes and government authorities regulatory policies achieve the purpose? What is the reason for this situation?
Industry experts and entrepreneurs are generally considered to be caused by two situations: First, the production capacity is overwed behind. Excess capacity caused the owner’s crimp, and the vicious competition between enterprises. After the production method, it means that there is too much profit division of the owner and the design side, and it is too small to leave the construction unit. Everyone asks the government to change the current industry system.
Controls competition, controlling the profit deprivation of the upstream industry, the settlement method of the engineering cost is best returned to the quota, and it seems that the development of the construction industry hopes in the government, and there is very little relationship with the company.
This situation has existed many years, and the construction entrepreneurs shouted for many years. The association also helped the industry to call for many years, and there is no way to develop in the direction of the business expectations. On the contrary, the number of enterprises is more, and the malignant competition has become more intensified, and the industrial formation is quite slow, the project general contracting mode (EPC) has never formed mainstream.
This is necessary to study, what is the truth behind the problem? Solve the problemWhere is the way?
We must be awake: the current world is a low-carbon economy, and the investment subject is a private enterprise. In this large background, the lowest price winning bid (a qualified building product with the lowest consumption) is already an irreversible trend. The lowest price of government investment projects is a major international practice. Under such trends, how to change the current status of the industry and enterprise survival status is where entrepreneurs should think and break through.
We must also realize that in the current China’s large environment, we will wait for the efforts of the government to improve the industry environment. The industrial change in the nearly 10 years has confirmed this. We should now more reflect on yourself: Can the current situation you can change through your own efforts? Can an enterprise efforts affect the development of the industry? Studies have shown that changes and improvements within the enterprise can make our own escape, and can change the current situation in the industry.
The current dilemma is mainly due to the long-term influence of future business philosophy, long-term quota counting method and plan economic thinking, due to corporate change and management improvement.
The problem of the problem
The construction industry is very unreasonable as a high-risk and high-risk industry.
Everyone is alive, on the other hand, there are more and more newcomers and new companies to rush, a dozens of projects, and hundreds of business bidding to break the head. The profit of the construction industry is much lower than other industries. The risk is much more risk, and the industry growth is 2 ~ 3 times the growth rate of GDP. The overcapacity of production capacity is getting more and more serious. This does not meet the general economic law: water to low, money Go to the height. What is the truth?
True Pie: Low corporate profits, project profit
The so-called industry profit is low, everyone’s statement and statistics are reflected, and the company’s headquarters is low, and it should be not low in project profits. .
Due to the management of domestic construction enterprises and management capabilities, intensive operations cannot be performed, most private construction companies and more and more large-scale architects take project contracting. The method is used as the main means of project quantity and geographical expansion. The result of this simple and extensive business operation mode is that there is a large number of profits, and some corporate headquarters itself uses only the role of the Taxation Bureau, collecting the management fee, or makes money by internal banking, even a batch of reactions Sign, the assembly of the construction enterprise with a fee.
The project assumes all responsibility (take items, financing, quality, safety, progress). At total of each project of the corporate headquarters, the management fee of 1 to 3 points is charged, and the management fee is expected. Some projects must help the ass (the project manager running after the loss), and it is impossible for a year. In such cases, the headquarters laid a low profit is normal, and the project has taken high profit.It should also be.
Truth 2: The profits of enterprises and projects are low, project members or sub-packaged suppliers’ profit
This is also one of the typical phenomena of corporate management capabilities, rich and still poor temple. The units at all levels of the enterprise have not earned money, and the individual’s personal rights (bag, procurement) earned money, subcontractors, suppliers earned money.
This situation is more common in state-owned large construction companies, and private companies are not in a small number. There are a lot of profit vulnerabilities on the project, and the headquarters and project department are weak, and the project is running around the project. The most serious thing is that in the case of power control and control, the project is lacking professionalism, putting water for individual private profits, subcontractors, suppliers, resulting in project loss.
Truth 3: The total contractor is low, professional company’s profit
The industry segment is large, the industry segment is large, the difference is huge, see the figure below.
From the table, it can be seen that the professional company’s profit margin is much higher, about the total contracting company 2 to Three times (most of China’s construction profit from the property, otherwise the gap is larger), the price-earnings ratio is 2 to 3 times the total contracting class, indicating that the professional company has higher profitability, and the capital market has higher professional operating models. Recognition, but our company is very keen on doing big, full, diversified, unintentional in the main business or in a certain field, doing professional, making a brand, resulting in low profits.
The total number of contracts, the number of brands in the enterprise is small, lacking unique core competitiveness, low-cost competition has become an inevitable means, low profit survival has become an industry.
Truth 4: Enterprise, Project, Personal and Subprunes are very low, but not mainstream
is very simple, such a business itself is impossible to survive long-term, will naturally Disintegrate, or forward, or merged, acquisition. Market economics determines the capacity of natural regulation of the market, such companies and industries can not survive, do not need us to worry.
It is really important to worry that due to industry complexity and corporate management, the company’s profit is low, profit flowing to projects, individuals and suppliers, and seriously affects the industry’s benign sustainable development. Projects, individuals, subcontracting and suppliers, more money, will not be the re-investment in the industry (technology, informationization, talent training, etc.), not to bind to industry progress, is very disadvantageous to the industry.
Excess capacity leads to malignant competition and compaction, the problem only takes into account this step. The overcapacity of production capacity is actually a representation of the industry, and there is still overcapacity in the industry. It must have a deep reason, which must have a deep reason.New accessors can easily join competition with low risk.
The current contractor company is in the long run, and the extremely obsessive relationship is extremely obsessed with the competitiveness of the relationship. It is negligible to improve the company’s internal strength, lacks real core competitiveness, operates in brand, technology, funds, Purchasing, cost control, etc., the new entrants are uncomfortable. Special my country’s construction industry is in a long time in scale, large business costs are higher than small enterprises, and small business costs are higher than that of individual packing. This kind of industry situation has caused a new entrant that will have a relationship between the project but there is no management experience, and the competitor is incremented but cannot be controlled.
Any industry progress, implementation of industry integration, improve price and profit space only two paths, a dependence brand, such as Apple, Luxury Brand, a large-scale economy The cost advantage is merged with backward production capacity, preventing new entrants from receiving pricing rights, such as home appliances, department store chain industries. There are no achievements in the Chinese construction industry, and the overcapacity of production capacity cannot be controlled.
China’s construction industry has had a good day. In the early 1990s, due to small business, the status of architectural enterprises is quite high: there are high 30% advance payment, there must be hundreds of quotas. The meta-house manual, machinery, and turnover material subsidies, such a good day has not returned. The price and competition fierce in the market economy are determined by the supply and demand relationship, and the administrative regulation is difficult to play a decisive role.
The current huge amount of huge crescent, a large extent is the result of market competition, and it is not necessary to complain that the owner is too bad. Forcing the Government to organize the control policy, everyone uses yin and yang contracts, and these are the construction enterprises themselves in cooperation, and they have explained that these practices have violated the market economic rules. BT, BOT is not legitimate to accompanment? As long as the market economy is willing, it is generally reasonable.
Therefore, the responsibility of changing the competitive ecology is the first is the company, not a government industry policy.
Some large architectural entrepreneurs have even have such old ideas: the high cost of large business is inevitable, the burden is large, the old problem is more. I have forgotten the responsibility of an entrepreneur, that is, through continuous innovation to enhance corporate production efficiency, use the least resource to invest the largest social value and welfare, which is the entrepreneur’s duty.
Large-scale construction companies are unfavorable, but it should be seen that more favorable is more favorable compared to small businesses. One year, 1 million tons of steel bars (large enterprises), a total of 1,000 tons of steel bars (packaged heads), 10 billion funds are costly costs less than 10 billion funding costs, high efficiency. Many large-scale entrepreneurs enlarged their shortcomings, but there is no ability to innovate, and will be effective as economies of economies of scale. Entrepreneur’s responsibility is through innovation, overcoming the company’s shortcomings, and plays enterprises.The advantage, the long-term scale of China’s construction industry should not be.
From the international point of view, the construction industry has already shown the basic rules of scale economy, which has formed a large number of large enterprises, and many kinds of professional subcontracting, Japan, and European and America.
The construction industry has low profit, but the architect is not reduced, what is the truth behind?Do you have any supplements?Welcome to comment!Everyone exchanges!