In 2012, the building materials market remained in a downward trend. Qin Zhanxue, Executive Vice President of the China Building Materials Circulation Association, noted that the Building Materials Home Index (BHI) continued to decline in December, following the downward trend seen in November. Major building materials and home furnishing markets were entering their seasonal low, with many stores launching promotional events during the off-peak period. These holiday sales campaigns were not aimed at maximizing profits but rather at boosting sales volume and building customer relationships for the upcoming year.
Over the past few years, the real estate sector had been heating up, prompting flooring and home goods retailers to compete fiercely for prime locations in major cities. "Staking" ground became a key strategy for these businesses, as they sought to capture market share. However, this aggressive expansion led to over-saturation and fierce competition, resulting in several challenges for the industry. According to Qin, many large building materials and home shopping centers faced declining occupancy rates, difficulty in attracting investors, frequent changes in management, and issues with rent collection.
In December 2012, the BHI stood at 106.48, down 3.32% from the previous month but up 0.72% compared to the same period the previous year. Sales for the national-level building materials and home furnishing sector reached 100.6 billion yuan in the previous month, a 5.92% drop from November. Annual sales totaled 1.2467 trillion yuan, representing a 2.46% decrease year-on-year. This marked a challenging year for the industry, as it struggled to maintain growth amid economic headwinds and oversupply.
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