Standardization brings confusions to air-conditioning industry
Increased export and rising cost of raw materials accelerate the competition in the air-conditioning industry. The big labels turn to pricing and “standardization” to consolidate their market shares, which marginalized the small brands, the Market Journal reported.
From cleaning and services to health and installation aspects, major brands include Midea, LG and Haier have recently released a series of industry “standards”. This triggers whether the industry is directed to domination of corporate technical and service standards.
It has been a Chinese tradition that the government and respective industry association are responsible for drafting and formulating industries’ standards. However, in American and European countries, it is common that leading corporations formulate technical and services standards to complement industry’s development. As a matter of fact, “standardization” has been a major tool for leading industry giants to direct industry’s development and competition model. With the development of China’s electrical appliances industry particularly the air-conditioning industry, standardization campaigns lead by giants like Midea and Haier is an inevitable phenomenon.
A more developed and in-depth system of standards can help raise the quality level of the overall industry and establish a gatekeeper for new entries. However, by giving the “standard” corporations an overwhelming advantage recognized by the market and consumers, standardization can be an important weapon to dominate the market and win over the competitors.
The current “standardization” of the air-conditioning industry is full of flaws and blurry concepts. Many corporations are caught confused with the difference between industry standards and marketing languages. Standards are not perfectly conceptualized. Therefore, many refuse to acknowledge and practice certain established “standards” of others.
To a certain extent, such standardization leads by industry giants create a tougher obstacle for middle-sized and small-sized enterprises. At the same time, it shows tat Midea, Haier and LG have already established a concrete foundation of technical expertise and services. Future competition would revolve around size, distribution channels, branding and standards.