Innovation offers next engine for home appliance industry

As the development of China's home appliance industry enters the new normal economy of slower growth, independent innovation has become a new engine for the industry's further growth.

"After more than three decades of development, the production of China's household electrical appliance industry has reached a leading place in the world, and become one of the most competitive industries in the country," said Jiang Feng, director-general of the China Household Electrical Appliances Association.

Jiang said the industry has achieved remarkable results in restructuring and upgrading, and technological innovations have developed significantly with a series of breakthroughs.

"Despite those outstanding achievements, there are still some issues that need to be addressed," Jiang said. "There is a certain gap in core technology and independent innovation compared with the international first-class household electrical appliance enterprises."

Other problems include weak international brand influence, lack of business globalization and low price competition, said industry insiders.

In the future, it is planned to put more Chinese innovative products with independent intellectual property onto the market. That not only requires the improvement of product function, industrial design and manufacturing techniques, but also adding to consumer satisfaction. Meanwhile, domestic high-end brands should be cultivated, Jiang said.

China's economy is in transition. Household electrical appliance enterprises need to change their original mode focusing on large scale and high speed, said Xu Dongsheng, deputy director-general of the association.

"The next five years will be a crucial period for the country's home electrical appliance industry to adapt to changes in the new normal, and complete the task of transformation and upgrading."

The association formulated a guideline for the development of the industry for the next five years that explicitly sets forth the goal of developing into a power country in the home appliance industry by the end of 2020. It calls for effort from the entire industry chain to boost innovation, including the innovation of organization, technology, products, business models, management and services.

During the 2016 Appliance& Electronics World Expo in March in Shanghai, a number of Chinese household appliance enterprises, including Haier, the world's fourth-largest white goods manufacturer, demonstrated products with their own innovative technologies.

TCL Group showed its newly launched washing machine, the first of its kind in the industry, which ensures clothing and linens can be cleaned without secondary pollution.

Enterprises need various aspects of investment to achieve the strategic goal of innovation, such as for professionals, product R&D and design, said Chen Weidong, vice-president of TCL. He said the market is entering a period of adjustment, and even a cruel knockout stage, which can be both a challenge and an opportunity for businesses.

Industry sources said an Internet-based, personalized and diversified consumption era for the home electrical appliance industry is coming. Younger generations are paying more attention to consumer experiences and personalized service will become the main force. In this regard, innovation will drive the whole industry's transformation and upgrading.

wanghongyi@chinadaily.com.cn

(China Daily 04/06/2016 page17)