Overcapacity in the aluminum processing industry Internet + can save the downturn

Since 2011, the aluminum processing industry has become a member of excess capacity. The sharp drop in prices has directly affected the survival of enterprises in the aluminum processing industry, and many SMEs are facing a crisis of elimination. With the rise of “Internet Plus”, can SMEs usher in a turning point and whether the downturn can be effectively contained?

Aluminum City pessimistic aluminum processing industry is facing reshuffle

For a long time, the domestic aluminum processing industry's downstream industrial chain has not been extended enough, resulting in an excess of upstream production capacity. Aluminum processing industry is in the mid-low end of the common homogenization dilemma. Affected by factors such as the slowdown in macroeconomic growth at home and abroad, aluminum prices have fallen sharply, basically continuing to decline at a rate of RMB 1,000/t per year. The sluggish prices have greatly squeezed the profits of aluminum enterprises. According to the 2014 annual report of Chinalco, last year, the company realized operating revenue of 141.772 billion yuan, a year-on-year decrease of 18%; net profit was a loss of 16.2 billion yuan, and the aluminum market pessimism is gradually intensifying.

"Internet + Aluminum" ushered in the turning point of transformation

Since the beginning of this year, China has removed 15% of the export tariffs on aluminum processed products, and cut the prices of coal-fired power generation on-grid electricity prices and industrial and commercial electricity consumption, reducing the decline in the cost of electrolytic aluminum, although it can alleviate the current loss situation. But the aluminum processing industry must make its own adjustments to the downturn. Experts pointed out that under the “Internet Plus” slogan, whether it is the company’s own pace of following the “Internet+” or the passive acceptance of e-commerce market development, this is a leap forward in the aluminum processing industry.

Due to the industry's own characteristics, a large number of inventory problems in the aluminum processing industry accompany each other. If the "Internet +" online channel sales inventory is realized, inventory status can be responded in a timely manner to solve the long-term high inventory problem. At the same time, it can clearly analyze the market status and predict market changes, which also determines the company's ability to control the future development.

In addition, the combination of the Internet and traditional channels undoubtedly opens up richer channel resources for corporate product promotion. The company's product sales have steadily increased as companies communicate information directly to customers, target their core demands, and grasp customer purchase needs.

All in all, although the “Internet+Aluminum Industry” cannot solve the problem of overcapacity in the aluminum processing industry in the short term, it can be an effective way for companies to expand their sales and insight into market dynamics, and has absolute advantages in improving the competitiveness of enterprises. Faced with the current situation, B2B and O2O models can be effective ways for aluminum processing companies to connect to the Internet.