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Home > News > Industry Activities > How Chinese Hardware and Fastener Companies Deal with the Going up Steel Price?

How Chinese Hardware and Fastener Companies Deal with the Going up Steel Price?

By Xiao Jianxiong, Huang Rui , 2016-12-09 12:00:00

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How could hardware companies fight against the stress resulting from the increasing raw materials prices? Reporters of Time Dongguan found that affected by the situation, many fastener companies in Dongguan are trying to face the difficulties and find solutions to cope with the operation pressure.

On Nov. 30th, Zhou Qimin, manager of marketing department of Zhuhai Shibibo Color-coated Sheet Co., Ltd. went to Dongguan from Zhuhai to meet with Luo Zhaolong, Business Director of Dongguan Haoshun Precision Technology Co., Ltd. They were talking about further cooperation under the difficulty of increasing prices of raw materials. Mr. Zhou told the reporter, “We agreed on a partnership with Dongguan Haoshun and provided metal products to the company with a total value of over 20 million Yuan.  

However, to Zhou’s surprise, the market is changing. “The continuously increasing of steel price is the main problem.” He said. In the recent weeks, he was busy running about discussing with clients how to adjust their price due to the rise in price of raw materials. “The main material of our products is steel, and the price of steel is increasing 40%, thus we are under a big pressure.” He said, it’s acceptable if we raise our price appropriately.

In fact, the rise in price of raw materials has affected the running of downstream businesses like hardware companies, fastener companies, etc. Many companies take more measures to fight against the situation.

Not all downstream company has been affected by the increasing of materials. “The increasing material price almost does not affect us.” Jin Liguo, president of Dongguan Yiheda Automation Science and Technology told us. The company is producing parts for automation equipment. This year, the company’s annual sales are over 0.2 billion Yuan. 

Jin Liguo said, “This is because we have cut most of our production processes in the previous years and now we focus on the supply train integration and standardization construction. All our products are produced by OEM and based on customers’ requirement in limited quantities. 

Luo Zhaolong thinks, under the situation, companies in hardware industry could only cope with the stress through developing new products and improving added value of products. He suggested that companies should take measures, improve their technologies and better skills. What’s more, it’s better develop and launch new products and change some raw materials to adjust their product price.

The hard situation is expected to accelerate the development of reshuffle in the industry. This is a great opportunity and also challenge. It pushes companies to upgrade themselves and the development of the industry.

Source: www.timedg.com

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