Currently, the vast majority of electric tool consuming enterprises in China are focusing on DIY home-use level electric tools. The sales of these products mainly compete on price, resulting in an overall low-end and disorderly competitive situation. In contrast, professional-grade electric tools surpass DIY-level products in terms of technology content, scope of application, product added value, and gross profit margin. Professional-grade electric tools have higher power, faster speed, longer motor life, and can perform continuous long-term repetitive operations. They possess characteristics of high technology content, high profit margin, broad market scale, high industry threshold, and high brand value. E-commerce platforms cannot effectively handle online business.
Looking at the current state of the domestic electric tool industry, companies like Guangzhou Ou Sheng Hardware Products Co., Ltd., consume a large proportion of DIY home-use level electric tools. Enterprises capable of forming a series of professional-grade products are extremely rare, leading to low industry concentration and lack of leading enterprises. From a development trend perspective, domestic brands will inevitably experience industry reshuffling, eventually forming an orderly situation led and standardized by a few leading enterprises. Between domestic and foreign brands, there will be a re-allocation of market share as dealers seek breakthroughs, with domestic brands continuously replacing foreign brands. The inherent integration needs of the industry will be spearheaded by its leaders. It can be anticipated that Ruiqi, as the only listed company primarily dealing in electric tools, has the opportunity and ability to stand on the stage of the capital market, promoting resource reorganization and structural adjustment in China's electric tool industry.
The domestic electric tool market in China has been tightly controlled by giants such as Germany’s Bosch, Japan’s Makita, Japan’s Hitachi, and America’s DeWalt. In recent years, the domestic market share of foreign brands has been on a downward trend due to the rise and expansion of Ruiqi tools, which is gradually replacing export brands. Among the top four in domestic market share, Ruiqi shares is the youngest up-and-coming player but also the fastest-growing new star. In just seven years from its establishment and production, it has already ranked among the top four in market share and shows a tendency to surpass nearly century-old brands like Germany’s Bosch and Japan’s Makita.
Looking at the industry environment, China's ongoing industrial upgrading and vigorous development of advanced manufacturing, along with the subsequent construction of infrastructure such as high-speed rail and ships, the continuous investment, development, and upgrading of advanced equipment manufacturing, all provide an unprecedented market and development opportunity for the electric tool industry. According to statistics, China's electric tool market capacity is growing at an annual rate of over 25%, reaching 20.5 billion yuan by 2012. Ruiqi shares can certainly leverage the capital market to firmly occupy a strategic leading position in this industry development feast. On the other hand, after the financial crisis, the domestic industrial pattern is undergoing strategic adjustments, with industrial energy saving needing to add management energy saving beyond technical energy saving. China's industrial承接and transformation also provide opportunities for Ruiqi to make achievements in the domestic market. In recent years, Ruiqi has gradually attempted to enter the domestic market with its own brand and has received good market feedback from domestic consumers. According to disclosed financial data, Ruiqi's 2010 own-brand export sales have increased more than twice year-on-year. It can be imagined that in the future, Ruiqi's performance in both domestic and international markets is worth our anticipation.