Seven Existing Malpractices Restrict China's Spring Industry Development

The core tips: 1. The company is small in scale. There are about 1600 Spring factories in the whole industry, most of which are privately-run private enterprises. The industry employs about 30,000 people. The largest Chinese spring plant in the industry has more than 900 employees. The average size of the industry-wide enterprises is less than 20 people, which is a typical industry dominated by small businesses. The company's solid 1. Small-scale business, the entire industry has about 1,600 spring plants, most of which are privately run private enterprises, the entire industry employees about 30,000 people, the industry's largest Chinese spring plant has more than 900 employees The average size of the industry-wide enterprises is less than 20 people, which is a typical industry dominated by small businesses. The company's fixed assets related to the disparity. The smallest individual company has only tens of thousands of yuan in fixed assets, while the largest company has several hundred million yuan. The average labor productivity of the industry is less than 70,000 yuan, and it is also an industry with labor-intensive and manual operations.

2. The degree of intensification of production is low and it cannot be scaled. Taking suspension springs as an example, the largest output companies only produce more than 1 million pieces each year. The combined output of all companies in the country is not yet comparable to the annual output of a Japanese NHK company. Due to the low degree of intensification, some companies’ production capacity is let down, and another part of the company is repeatedly invested, resulting in waste of resources.

3. Product structure similarities lead to excessive competition in the market. The result of price dives will be a lose-lose. The most typical number of motorcycle spring prices will drop once and then fall. Currently, the price of raw materials has approached the cost of raw materials. Many companies have no profit and are forced to withdraw from the field. The direct consequence of fierce price competition is to lead to a decline in product quality, a decline in corporate profits, a lack of funds for enterprise development, and inability to renew equipment.

4. Lack of opportunities to participate in simultaneous development. The foreign automobile industry generally adopts the model of simultaneous development of parts and vehicles. Through collaborative development, the parts factory can not only gain valuable development experience, but also take the opportunity to set up technical barriers to patents. Various kinds of names, such as intellectual property rights, are used to prevent other companies from infecting the R&D and production of the same products. The vast majority of automobiles in China are imported models from abroad, and they are subject to system development in terms of product development and recognition.

5. The related industries have insufficient support for the spring industry, and spring production cannot afford the lack of raw materials and the support of the spring manufacturing industry. These two aspects are precisely the weak points. The low quality of domestic raw materials is well known. The gap in equipment level is also known. Compared to foreign companies, they can not only draw materials locally, but their peers such as the Central Japan Winding, South Korea's Daewoo Steel, Krupp and M&B have their own wire processing lines. Only one foreign partner has taken the initiative.

6. The level of development of enterprises varies. The level of equipment of advanced companies is comparable to that of the early 1990s. It has complete sets of production lines imported from abroad and complete testing equipment. Well-developed companies are also purchased from Germany, Japan, Italy and Taiwan. In addition to some key equipment, such as CNC coil spring machines, double-disc grinding machines, and pass-through shot peening machines, the domestic equipment has basically been updated, but such companies have not yet achieved a logistics production line. In contrast, The equipment level of most enterprises is not high, and a large number of equipment in the 1980s and even 70s have not been updated, and manual production accounts for a considerable proportion. Compared with the quality level of technical equipment of foreign counterparts, the gap in management level is even greater. In information management methods, a small number of enterprises have started to adopt computer management, and most of them also use traditional management models. There are obvious traces of family-owned management in private enterprises. Some quality management companies have passed ISO9000/QS9000/VDA6.1 certification. Some companies have passed ISO9000 certification. A considerable number of companies have not started this work yet.

7. As the new spring companies continue to emerge and the price competition is intensifying, a considerable part of the old state-owned and collectively-owned enterprises is difficult to compete with new private enterprises due to institutional, historical burdens, and obsolete equipment. At present, it is through the sale and joint-stock reform to get rid of the predicament, in which Hangzhou Spring Factory has been restructured into a joint-stock enterprise, and other businesses that are still in operation are planning to reform. On the contrary, some private enterprises that have already completed their original accumulation are ambitious and are planning new development plans in order to improve their product quality and competitiveness.