While compared with large-scale fastener companies, small and medium sized fastener companies usually are weak in resisting risks, whose products are low value-added, low-end, and low-tech, owning no research departments or institutions. In recent years, many small and medium sized fastener companies reduce their production and even close down due to market impact and cutthroat competition. Survival of the fittest is the result of natural laws. However, when confronted with complicated market conditions of slow global economy growth, the European debt crisis, and the increasing cost of labor, raw materials, land and logistics, how can small and medium sized fastener companies break development bottleneck? How can they find a way to survive? Where’s their development direction? These are worth the owners to consider seriously. 

Rely on strong companies, integrate resources
Firstly, small and medium sized enterprises must have a correct recognization on themselves. It is unrealistic to count on government to save market; the companies who want to survive must reply on their awareness. The operators of small and medium sized enterprises should be open-minded. When companies enter a dead end, the operators still insist on ownership and even witness its bankruptcy instead of cooperating with others to figure out a new way. Small and medium sized enterprises are never lack of strengths, what they lack is an open mind.

The company who still possess its market share relies on its ability to integrate resources. There are two reasons for the bankruptcy of small and medium sized enterprises, the outside stress and absences of competitiveness, which could be summarized as lacking of capitals and resources. The lacking of capitals will increase the cost stress of labor, energy, land, and transportation while the lacking of resources will result in missing the opportunities to invest products and dig out new channels. If the small and medium sized enterprises can cooperate with large company, they can develop a new strategy where they can make full use of large companies’ advantages of technology, equipments and capital as well as quickly develop new products and new technology.

Choose subdivided market, focus on one kind product
Many small and medium sized enterprises think only through diversifying products can they meet the varied market demands. However, when the manufacturers diversify their products, the production cost is so high that they cannot conduct mass production or establish extensive sales networks, and their companies further get worse due to the absence of professional after-sales service, which will make them drag behind others in the end. The entrepreneurs who can operate well their companies will choose one subdivision with consideration of competitiveness and advantages to develop, and input everything they have to make the most excellent products. A good sample is Dongguan Guanhong Hardware Products Co, Ltd, which has been devoted to the production of rivet nuts from M2 to M12 since 2006. Its products widely used in automobiles, electronics, household appliance, machinery, toys etc.

Mr. Yang J.F, CEO of Shanghai Ebseek Exhibition Co., Ltd (the organizer of Fastener Expo Shanghai), indicates that fastener industry will also meet its market segmentation in future when the large companies will integrate more resources. As for small sized companies, they should choose one kind product as their subdivision market before they are equipped with that ability. Many small and medium sized enterprises blindly expand their product ranges when the market is prosperous. But the companies like that are the weakest to withstand risks. Companies should accumulate capitals during flourishing periods in order to create more valuable products when market goes worse. When one kind product is perfect in no matter quality, stock or delivery, it is so strong that it will never be crushed down. 

Just like the famous economist Mr. Hu Zuliu ever said, “There are many Chinese enterprises exceedingly pursuing scale but ignoring core competitiveness; it is a very dangerous act”, the small and medium sized fastener companies should figure out what’s their weakness and advantages, integrate resources, choose subdivided market, strengthen competitiveness. And that’s the way for small and medium sized companies to survive.