Analysis of the status quo of China’s hand tool industry

In the past, China was mainly used as a production base for hand tools. In recent years, with the rapid growth of the domestic economy, China has become the most potential consumer market for hand tools. Industry insiders believe that the mainland domestic market is no less than the European single market or the North American market, and the number of consumers of hand tools is at least 400 million. Numerous hand tool manufacturers have entered the Chinese market.

At the same time, Chinese hand tools have also begun to compete in the world market. The most common product categories produced by manufacturers are mostly fastening tools, such as basic hand drills, impact socket wrenches and combination types. The main market is overseas markets. In particular, manual tool manufacturers in Fujian, Jiangsu, Shandong and Zhejiang are increasing their production capacity to fully cope with the expected increase in export sales, expanding overseas market coverage and obtaining better margins by producing mid-range and high-end products.

Hand tools are mostly low-profit products, and their production is mainly affected by the price of raw materials such as steel. Moreover, market competition is fierce, and it is impossible to raise prices uniformly. Individual price increases are undoubtedly tantamount to giving up old customers, and no one dares to risk losing the market. Under normal circumstances, when products are sold to other industries, the hand tool industry is required to reduce the price by about 10% compared with the previous year. It can be seen that once the price of steel rises sharply, it will directly affect the survival of hand tool manufacturers. At the same time, in addition to the company’s own reasons, the product competitiveness of hand tools is largely determined by the quality of raw materials, that is, the quality of steel. At present, some hand tools use steel materials that still have surface quality and internal cracking problems. It is an issue of steel smelting technology that cannot be ignored.

Chinese consumers’ sources of information on manual tools are mainly concentrated in specialty stores, exhibitions, trade fairs, and salesperson sales. It is particularly worth mentioning that consumers do not know enough about the brand when they buy for the first time. A large number of people are Only after buying and using it did you understand the brand and quality of hand tools. It can be said that the brand establishment of hand tools is the best time for Chinese hand tool companies.

Looking at the international tool companies, the gap between Chinese tool companies is obvious.

In terms of scale, foreign companies are relatively large, such as the US Schneider Corporation, which is one of the top 500 companies. Its products include hand tools and power tools, automobile diagnosis and repair equipment, diagnosis technology and related products, which are widely used in automobiles, aviation and other commercial fields. Most of China’s tool companies are small in scale, and the product series are not rich enough, and they are typically “many but not strong.”

In terms of strategic planning, the products of world-class companies often give people a very clear impression. Excessive competition exists in our tool companies. Many domestic manufacturers and brands are not prominent in their main businesses, and their core competitiveness is poor.