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Three aspects to accelerate the development of the valve production industry

Sep 25, 2019

The valve industry is an important branch of our general machinery. Its products are widely used in petroleum, chemical, metallurgy, electric power, urban construction, environmental protection and other industries as key equipment for fluid control.

Currently, the valve manufacturing industry is in a very favorable development opportunity. This is because: 

 1. The state-owned economy continues to develop steadily. Investment in fixed assets has gradually expanded. In particular, the construction of several projects such as “West-East Gas Transmission”, “West-East Power Transmission” and “South-to-North Water Transfer” requires a large number of valve products;

 Second, with the entry of the WTO, the decline of international trade thresholds and the adjustment of product structure in developed countries, China is gradually becoming the world's largest processing plant, and the processing of valve products faces greater development space.

So how to seize this strategic opportunity to accelerate the development of the valve industry. We have analyzed from the following aspects: First, the product will promote the joint restructuring of enterprises, and create a group of enterprise groups with scales as soon as possible.

There are more than 5,000 manufacturers in the valve industry. There are only 7 companies with annual sales revenue exceeding 50 million, 3 companies with more than 100 million yuan, and enterprises with more than 200 million yuan. The domestic market share is only more than 2% of the companies in China Nuclear Sujing, and the rest are below 1%. This kind of enterprise scale is difficult to generate shock in the market, and it is even more difficult to compete with internationally renowned companies in the same industry.

In order to change this status quo as soon as possible, in addition to the growth factors of the enterprise itself, the effective method is to realize the capital expansion of the enterprise through joint, merger and reorganization among enterprises to further expand market possession and remain undefeated in the competition. This is a relatively popular practice in today's international economy, and it is also a directional problem in the development of the valve industry in the coming period. On this issue, we must emancipate our minds and break the boundaries of the country according to the requirements of the 16th National Congress of "new reforms must be made, new developments must have new ideas" to break the boundaries of all boundaries and break the traditional division of professional division. As long as there is a possibility of joint ventures between enterprises, they can boldly try and try to build a group of enterprises with an output value of more than 500 million yuan and ** billion yuan in 3-5 years.

Second, we must pay attention to the adjustment of product structure, be brave in technological innovation, and develop high value-added and international products.

China's valve industry has been able to produce more than a dozen major types of products. Although these products strongly support the domestic economic construction, we should be aware that most of our products are general technical content or labor-intensive products, and rarely have international standards.

The bidding of the main line of the West-East Gas Pipeline is a regrettable fact that all of our valve companies have lost. It hurts.

There are several ways to implement technological innovations to research and develop new products. One is through cooperation with academic institutions of the institutions, and the other is in the form of foreign cooperation or technology introduction, which shortens the gap between our products and foreign countries. In addition to the above practices, qualified companies can develop.

According to the statistics of the China Valve Association, at present, our valve industry has a serious overcapacity. About 40% of the production capacity is short-selling. In the face of such a huge overcapacity, an effective method is to implement a diversified sales strategy and vigorously explore the international market. At present, the international market exports about 60-70 billion valves per year. China's annual export is 1.5 billion yuan, less than 2% of the quota. There is great potential here.

To open up the international market, we must first focus on the training of foreign trade talents. There are a number of foreign trade professionals who will understand foreign languages. Secondly, we must learn to use the Internet and information technology to make customers share business opportunities. Third, we can cooperate with some domestic foreign trade companies to expand their channels. Export; the fourth conditional enterprise can sell or open a factory at the local peripheral point.

Fourth, improve the management level of enterprises, implement management innovation, deepen enterprise reform, and implement institutional innovation. China's valve industry is currently in a new round of alternation and restructuring.

The proportion of state-owned enterprises has been declining year by year, and private and foreign-funded enterprises have developed rapidly. According to incomplete data estimates, China's current proportion of valve industry assets, private accounted for 40%, state-owned 30%, the rest for the three-capital, military-owned enterprises, it is expected that the share of private and foreign-funded enterprises will further expand in the next few years. For the fast-growing private enterprises, although there are no institutional shortcomings and historical burdens, the development process should focus on the improvement of corporate management level, implement management innovation, and avoid falling into the "family-style" and "parental-style" management.

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