On the home appliances in policy implementation problems and suggestions for improvement

[Abstract] "home appliances" is a national support and benefit agriculture, expanding domestic demand, stimulate production, to maintain stable and rapid Economic growth of the macro-control policies, the people, interest rate, Quo, but implementation has revealed some not ignored: farmers did not deserve benefits, financial subsidies to be divided up in disguise, unfair competition among enterprises to further intensify this end, the need to create a favorable environment for policy implementation, the policy effectively adjust and improve the implementation of supporting control measures to effectively implement the farmers may benefit, companies have to market, the Government's policy objectives more popular.

[Keywords] home appliances; financial subsidies; successful business; sales outlets

"Home appliances" policy on December 1, 2007 onwards in Shandong, Henan, Sichuan, pilot, December 1, 2008 extended to 14 provinces, municipalities and autonomous regions, February 1, 2009 covering the whole country. On policy background of the financial crisis facing the environment is sluggish exports, the city market saturation, the purpose is to guide the home appliance business to develop the rural market and stimulate domestic demand and promote Economic growth, according to policy, the farmers in the successful distribution companies and the Direct to join or authorized outlets, purchase successful manufacturers of televisions, washing machines, refrigerators (freezers), mobile phones, air conditioning, computers, water heaters, microwave oven, induction cooker, electric bicycles 10 categories, more than 1,000 models of successful products in the price ceiling of bid price by 13% to enjoy the financial subsidy, farmers purchase of household appliances of each type of 2. China has 900 million farmers, the rural market has a huge potential for Development, but the purchasing power of farmers and low income levels, willingness to buy is not strong Financial subsidies can effectively increase the market demand, while in the support and benefit agriculture, expanding rural household appliances market. But the people, Lee Enterprise, Republic of policy implementation has revealed some problems can not be ignored, if these problems are not promptly and effectively resolved will directly affect the effectiveness of policies.


A "home appliances" in policy implementation problems and cause analysis

1.1 farmers "home appliances" lukewarm response
"Home appliances" policy is to expand rural consumption and improve the living quality of farmers, promote the building of new socialist countryside is an important initiative in the country to implement more than a year's time, but the investigation into the situation, farmers The support and benefit agriculture policy and did not show proper enthusiasm for subsidies to poor response. analysis of the main reasons are:
(1) the low living standards of farmers
China's low level of income of the farmers, safeguard measures are not perfect, future income growth is expected to be difficult to determine, is the "home appliances" difficult mainly due to .10 years, China's per capita annual net income of farmers from 2253.4 yuan to 5,153 yuan, in 2010 may exceed 5500 yuan, while achieving significant growth, but income levels are still low and uneven distribution, the more eastern, central and western regions poorer, but far more than the eastern part of central and western rural addition, protection of rural life has not been effectively resolved, The problem is that farmers are most concerned about pension and health care, and rural endowment insurance system, cooperative medical system has just started, is not perfect, the coverage is small, the amount of subsidies is low, does not solve the worries, coupled with expected revenue growth is difficult to determine, the majority of farmers prefer to save rather than spend the money to subsidize that.

(2) farmers' consumption concept behind
Farmers by the traditional consumption habits and a greater impact on consumer attitudes, willingness to save is strong, lack of willingness to buy, it is difficult to accept new things, with living within our means, the first of the fine tradition of frugality, save money is mainly used to build a house for their children to school , married women and married the future old-age, generally do not buy unnecessary things, financial subsidies to their less attractive. some people on the sidelines, hoping to buy time so after emergencies.

(3) poor rural infrastructure
Generally poor rural infrastructure. Transportation is not convenient, poor distribution channels, service system is not perfect, communication facilities are backward, grid Although coverage in rural areas, but the price is high, voltage instability, power is often the case, because the power prices, air conditioning, refrigerator, electric stove, water heater, etc. can not afford to buy affordable, voltage instability, and some appliances can not work, damage is also larger, once damaged, repair is a major headache thing, no running water, washing machine will not lead to How much convenience, most of the rural areas without broadband, no cable TV signal, the computer can not normally access, TV can only receive a limited number of channels is not clear, these factors seriously hampered "home appliances" policy enforcement .

(4) Product optional small
Although there are 531 enterprises with the successful production of the 10 categories, more than 1,000 models of successful products to choose from, but compared to the heterogeneous needs of 900 million farmers, the choice is still small, Moreover, all types of products and they can not put a designated sales outlets in each of the counter, especially the third and fourth line of the county, township outlets, the brand was incomplete, incomplete varieties, model failure, shortage of supply, out of stock merchandise is quite normal with a maximum limit also affects the number of people buying mood, partly because there is no more than limit subsidies.

(5) does not guarantee the product quality
Part of the successful business through "home appliances" of the machine, production and sales do not meet the requirements of the relevant national standards and successful products, illegal operations to earn ill-gotten gains, such as cutting corners to reduce costs, sell the backlog, outdated, substandard or counterfeit shoddy products. the end of 2009 the Consumers Association survey data, home appliances repair rate of 12.6%, average 8 appliances have one appeared maintenance.

(6) can not be guaranteed after-sales service
Service problems are: bad service, limited range of delivery, maintenance of network less maintenance cycle is long, low quality of maintenance personnel, quality of service can not guarantee, and the service unsatisfactory rate of almost 30%. To the country Rural building a comprehensive after-sales service system, and even Haier, Midea, TCL such enterprises is difficult to achieve, and costly.

(7) Price unknown
Financial subsidy is based on the bid price, bid price is the market price when the bid-based, companies can lower their own prices and can not raise prices, which the surface is reasonable, provided that: the market price when the bidding is not driving, since the market price after the bidding has not changed, around the same price, there is no market price is lower than the promotional price. In fact, this premise can not simultaneously have four, so it was a subsidized price than the market price after not how many, or even higher than the market price is also the phenomenon, although the government sometimes adjusted for the bid price, sometimes lower the prices of some companies, but the catch-up with changes in the market, the price in the end is high or low, who can not tell, but One thing is sure, the vast majority of farmers are not the real price below the market bought 13 percent of home appliances.

(8), poor access, lack of supervision
At this stage of the sales channels in rural areas, small business outlets, circulation and more, operating costs are high, service is poor, successful distribution companies in Direct to join or authorized network is difficult to cover all the country towns, and no ability to achieve true national the "countryside." Since the appliance is difficult to "countryside", and that farmers had to "city", which increases farmers' cost of shopping addition, network supervision, but also to Economic losses of some farmers.

(9) did not fully successful business promotional role
Policy of home appliances across the country more than a year's time, but some farmers still do not know where in the specified network, which home appliances are sold, the purchase process is what kind of after-sales service What is the criteria, migrant workers in the field Where to buy appliances that receive subsidies, etc. The government has a variety of communication channels to promote better, but the government vigorously promote the most successful companies had a dependent, do not take the initiative to promote in order to save costs, only in his house. " ready-made ", results in reduced effectiveness of the publicity.

1.2 Financial subsidies are divided in disguise
As of November 2010, total national sales of home appliances 104 979 800 units, sales of 219.667 billion yuan, financial subsidies paid more than 200 billion yuan. The direct financial subsidies targeted at farmers, but farmers are vulnerable groups, market Information, ineffective, many people satisfied with 13% of the subsidies, but subsidies do not know the base price is not a true market price, should get the benefits are not fully supported even those who pay into stimulating domestic demand, implementation of preferential agricultural policy has changed in taste.

(1) successful production companies get a double benefit market and affordable
The rural market potential, but marketing costs are too high, home appliance giants are not the main target market and now have a policy shop green channel, there are various levels of government are doing free publicity, there are financial subsidies to boost farmers' enthusiasm to buy, by " home appliances, "the rural market, have become a household electrical appliance enterprises consensus policy by many successful companies," wind ", received a double high sales and profit growth, such as Haier," countryside "in the first year on the victories brilliant, foreign income in 2009 fell 26.33% in the case, to achieve a 8.46% growth in operating income, net profit rose nearly 50 percent of the record.

The nature of business objective is to maximize profits, not just to meet successful production companies in the promotional role of home appliances, but drilling is not compatible with the policy and market loopholes, for "policy-price advantage," such as in the case of market decline continues according to bid price, although higher prices, but the subsidies by 13%, still look cheap, but not for profit model species, the "out of stock merchandise" in order to avoid the high costs of distribution and after-sales service. In this regard, national and the supervisory role of government is difficult to play these in the market dominance of the successful production companies to obtain the dual benefits of the market and the interests of the "home appliances" the biggest winner (2) the successful distribution companies are divided by a passive financial subsidies
Relatively high cost of home appliance products, mainly because of circulation and more decentralized grass-roots network, a large amount of funds used inventory, logistics and distribution costs are high, service difficulties, the other grass-roots type of sales outlets are mostly small-scale individual taxpayers general taxation of the periodic fixed mode "must invoice" means to get their 3% tax, the tax had not hidden subsidy payments on behalf of funds, far less cost to sell other products, which greatly reduces the grass-roots network of sales initiative. successful manufacturing enterprises to promote the sale, had none other to increase the flow of business through gross margin, and this part of the expenses, and eventually the use of pricing strategies, implement financial subsidies in disguise.

Links to free download http://www.hi138.com

(3) "those who lie to make" also got a slice of sub-
The management staff, corporate and sales outlets are likely illegal operations, in cheat up, but the main non-agricultural households who cheat up these urban residents and friends to borrow the rural household registration booklet, identity cards, bought the rural household appliances. sales outlets in order to increase its sales, acquiescence and even encouragement of urban consumers cheat up, and direct outlets to advance subsidies for this behavior provides a convenient, relevant review is not strict, but also for their minds at ease if the collusion , it is difficult to identify true and false regulatory authorities for testing, to no avail. Some people get married urban wedding, with all the "countryside home appliances", relatives and more urban residents in rural areas can also take account of this to friends and colleagues use, even the emergence of the phenomenon of rural households rent.

1.3 "home appliances" exacerbated by unfair competition among enterprises
As the "home appliances" to further advance the brand-name competition among enterprises and SMEs, the gap continued to widen, the appliance company polarization trend is intensifying.

(1) the strong stronger brand-name manufacturers
As the bidding higher standard, so far, only winning more than 500 production enterprises, less than 1% of the total number of household electrical appliance enterprises from January to November .2010, the successful business of selling home appliances 67.3 million units, sales total of 150.41 billion yuan, an increase over the previous year were 1.4 times and 1.8 times, such as "Going big" Haier, tender in 2011, 12 class 697 products are all successful, as of August 2010, has sold to the countryside household appliances more than 500 billion total annual sales growth rate remained at 50%. In addition, Changhong, Midea, Hisense, Gree, Skyworth, a new fly, TCL, Konka, Lenovo, etc. benefit from the "home appliances", varying degrees to achieve sales growth.

(2) the weak weaker small and medium manufacturing enterprises
In the "home appliances" policy, small and medium manufacturing enterprises, whether successful, competitive disadvantage will be more apparent. With the policy of home appliances and subsidies to promote the release, did not bid the price advantage gone SMEs, has rural market is being squeezed and that the successful occupation of famous enterprises, SMEs are also due to the successful production, quality, brands and other aspects of the disadvantaged, in Information-poor, weak in rural areas to identify, it is difficult to gain market share, successful business in 2009 in, there is total sales of less than 13 million, while sales of 14 zero in the national electrical appliances directory contains the company's 97,000 businesses, more than 99% are SMEs, many of whom are growth Well, there is great potential for Development of the brand, but not a good market environment and policy environment is difficult for them such as Haier, Midea, Gree, as developed into a brand.


2 recommendations for improvement

Strong agricultural benefit farmers, and expand the rural market is the most fundamental way is the market mechanism and the dual role of policy guidance to substantially increase the living standards of farmers, farmers' consumption concept updating and improving rural infrastructure, quality of rural production and living environment, improve the rural market system and service system, but these need to go through years of effort to achieve. practical suggestions for improvement are:
Range of 2.1 to adjust financial subsidies
There are three suggestions: First, expand the range of home appliance products, increasing the variety and type, the farmers used large appliances, small appliances are included in the scope of subsidies, the second is the "home appliances" to "mechanical and electrical appliances", the farmers greater need for agricultural vehicles, agricultural machinery and processing machinery and other production products are included in the scope of subsidies allow farmers to get more benefits, the role of boosting the economy will be greater and the third is not some high-end products continue to improve the price ceiling, rich farmer groups should enjoy a higher subsidy, the effect of subsidies are not incompatible.

2.2 to revise the subsidies
The base price should be subsidized at the local market price, rather than the bid price or the price of corporate self-adjustment should be within the scope of the bid price, to negotiate a good price for the base subsidy of 13%, by advance sales outlets on the spot if the subsidies can bring tangible benefits to farmers will not easily booklet, identity cards and so let other people use, even after so no need to also buy, which to some extent reduce the cheat up on the Modify subsidies Another benefit is that successful companies no longer have "policy price advantage," which can greatly ease for "home appliances" policy has led to unfair competition, the real "companies have to market" rather than "get benefits", so that the country's financial subsidies in the market self-regulation of fair and effective implementation. In addition, 13% subsidy of national unity defective, east, central and western farmers' income gap, between rich and poor regions are not the same, the same subsidy rate on the role of boosting the economy around is not the same, should not be generalized.

2.3 home appliances products exempt from VAT
Most of the grass-roots sales outlets at fixed taxpayers usually do not use a receipt invoice only way to hide the tax, which is selling home appliances and other non-products Industry practices. Must sell home appliance products, invoicing, to get their 3% over the fixed part of the VAT, which will lead to lower profits or even losses grassroots network, seriously affecting their sales initiative. Sichuan Business and Tax departments issued a "use tax invoices" policy is worth learning. "Home appliances" is a special policy should be special treatment.

2.4 give full play to the role of the successful business promotional
Promotional levels of government should be, successful producers and distribution companies jointly bid was awarded to enterprises should play a promotional role fully, through in-depth research to understand the rural production and living habits, understand the needs of farmers and consumer features, such as taking leaflets, cultural programs, road shows, movies, parties, promotional caravan to the countryside and so outside the shop mode, create atmosphere, to expand sales.

2.5 Government, community and business multi-joint, concerted efforts
"Policies, under the measures" China's a big strange phenomenon, mainly due to local government and law enforcement officers rent-seeking, profit-maximizing enterprises, the policy itself is flawed, inadequate policy implementation, monitoring and other causes. To the "home appliances" policy really benefit the public, interest rate, Quo, first, require the State to continue to improve the government subsidies, to strengthen the local government, law enforcement and supervision of successful enterprises, to maintain government decrees, carry out some more such as "quality of the line appliances to the countryside" and other activities, fraud, Kengnonghainong, disturb the market order of successful enterprises, the deletion of the standard qualifications and severely punished, and secondly, the local governments at all levels should effectively implement the national government and relevant departments spirit of the document, the establishment of a government-led, business-led, finance, business, quality, price and other departmental interaction, social participation, "two points for a" propaganda and regulatory approach, the branch set up Consumer Association to the township level, the consumer complaints to the station and 12315 villages to establish liaison and sales outlets, regulators at all levels to layers of signing of the responsibility, who is monitoring the implementation of the system who is responsible, and timely processing of complaints and reports, and finally, successful enterprises should actively cooperate with the government and society strength, strict quality control, thorough investigation of counterfeiting, to prevent cheat up acts.

References:
[1] China Ministry of Commerce, General Secretary, Ministry of Commerce, Ministry of Finance: on the issuance of <<home appliances operating rules>> Notice [Z]. Home appliance Information management system for 2009-10 -04-23
[2] Ministry of Finance, the Ministry of Commerce: on the issuance of <<home appliances business assessment and management approach>> Notice [Z]. Home appliance Information management system for 2009-10 -11-03
[3] Department of Commerce, Finance, Industry and Information Technology, Ministry of Development and Reform Commission, State Administration of Taxation, SAIC, AQSIQ: on the issuance of <<home appliances distribution network management implementation details, "the notice [Z] . home appliance information management system 2010 to -06-28
[4] Ting Sun. On the home appliances to the countryside policy implementation problems and countermeasures [J]. Business Economics, 2010 (9).

Links to free download http://www.hi138.com