Upstream product operation

by 9aincemiss on 2012-02-12 08:02:04

Initially, it was commonplace to install underfloor heating systems in rooms, but the idea of installing such systems in melon fields is indeed novel. Last winter, Beijing Sifang Ruixing Floor Heating Technology Co., Ltd. (hereinafter referred to as "Sifang Ruixing") successfully installed an underfloor heating system in a watermelon greenhouse of a farmer in the suburbs of Beijing. This extended the application scope of floor heating technology into the agricultural field.

Similar to Sifang Ruixing, many floor heating construction companies are no longer limiting their business scope to floor heating construction within the building sector. Some have extended the use of floor heating technology into new areas like watermelon greenhouses, while others have developed towards system integration around floor heating and related products, or started processing floor heating materials and products, all moving towards diversified development paths.

As a typical representative extending the application of floor heating technology into new fields such as agriculture, Sifang Ruixing has also applied floor heating technology to livestock farming and horticulture. It is reported that a landscaping grass heating project about to start in Tianjin will keep outdoor grass green in winter. With the application of multiple energy-saving technologies including sewage treatment, heat pump recovery, and solar heating besides floor heating, the project is expected to save over 5 million yuan in annual operating costs.

Compared with the intensified competition and increasingly meager profits faced by traditional floor heating construction enterprises, Sifang Ruixing effectively reduced its competitive pressure and maintained considerable profits by extending the application of floor heating technology into new fields such as agriculture and horticulture. The company's general manager Yu Hong introduced that the construction price per square meter of the floor heating system in these new fields can reach around 190 yuan, much higher than the dozens of yuan per square meter in traditional applications.

For extending the application of floor heating technology into new fields like livestock farming, Yu Hong said this is not a novelty in the industry anymore. A certain floor heating construction company, with the help of experts from the Radiant Heating and Cooling Committee of the China Building Metal Structure Association, once carried out a root heating project in greenhouses in Xinjiang with good results.

Different from the path chosen by Sifang Ruixing, a large part of the surveyed floor heating construction companies chose a path of expanding and deepening their business, developing towards system integration, transforming from merely constructing floor heating terminals to integrated design and construction of cold and warm comfortable home systems.

As one of the earliest advocates and practitioners of the integrated cold and warm comfortable home system, Beijing Anheng Xinda (hereinafter referred to as "Anheng Xinda") successfully won the bid for the phase II central fresh air system project of K2 Real Estate in Beijing in 2010 after three years of effort, setting a precedent for northern floor heating construction enterprises winning such projects. This also provided a reference for floor heating construction enterprises to horizontally expand the market and vertically explore related product areas. The company's general manager Zhang Yanchao introduced that since 2008, Beijing Anheng Xinda has conducted extensive research and development work on central fresh air systems, central vacuum cleaning systems, heat pumps, etc., apart from floor heating systems. Due to the company's early involvement in the integrated quiet home system, it has gained more attention from consumers and developers, laying a good foundation for them to choose its systems and products. In the first half of 2011, while the sales performance of some floor heating construction companies in Beijing declined compared to the same period last year, the company's sales performance showed a continuous growth trend.

Like Anheng Xinda, Beijing Yate Weida Cold and Warm Energy-Saving Engineering Technology Co., Ltd. (hereinafter referred to as "Yate Weida") and Beijing Wanganjia Intelligent Floor Heating Co., Ltd. (hereinafter referred to as "Wanganjia") also embarked on the path of system integration. Qin Xiaoming, vice general manager of Yate Weida, revealed that currently, floor heating terminal construction is only a part of the company's entire business. In addition to this, the company has also ventured into the installation of equipment such as geothermal heat pumps, air source heat pumps, central fresh air systems, and central vacuum cleaning systems. The company has successfully transformed from a mainly floor heating terminal construction enterprise to a comprehensive solutions provider covering everything from geothermal heat pumps, wall-hung boilers, and boilers to floor heating terminal construction.

Qin Xiaoming stated that the reason for the company to develop towards system integration is that the price of floor heating construction has gradually decreased, while the prices of raw materials and labor have increased, leading to diminishing profits for floor heating construction enterprises. To survive, companies need to increase their profit points. By going down the path of system integration, not only does the construction scope expand, but also the range of products operated by the enterprise expands, thus increasing the company's profit points.

While Sifang Ruixing, Anheng Xinda, Yate Weida, and Wanganjia extend the application of floor heating technology into new fields or go towards system integration, there are also a few floor heating construction companies choosing to advance upstream into the industry, transitioning from agency of floor heating products to R&D and production of floor heating products.

Beijing Sanheng Kemaite Co., Ltd. (hereinafter referred to as "Sanheng Kemaite") is such a company. Since 2008, the company has invested millions of yuan in researching and producing several series of HVAC self-control products, entering the floor heating material production industry. Currently, the products developed and produced by the company already include thermostats, manifold collectors, multi-functional thin-type dedicated floor heating floors, and other floor heating-related products.

Why did Sanheng Kemaite choose to develop upstream in the industry when other floor heating construction companies were either extending the application of floor heating technology into agriculture, horticulture, or going towards systemization? In response to this, the company's general manager Feng Lishan said that developing upstream in the industry facilitates mutual complementation between industries, leveraging strengths to enhance the deep-level diversified development capabilities of floor heating construction enterprises.

In addition to Sanheng Kemaite, Beijing Tianhe Likang Water Heating Engineering Co., Ltd. also chose the path of developing upstream in the floor heating industry. The company's engineer Zhu Yinze expressed that similar to Sanheng Kemaite, the company not only acts as an agent for some upstream floor heating material enterprises' products but also independently produces some branded products. Regarding the current operating status of his own company, Zhu Yinze frankly admitted: "It's pretty good."

Regarding the different development paths chosen by floor heating construction enterprises, responsible persons of floor heating enterprises such as Yu Hong, Feng Lishan, and Zhu Yinze expressed that there is no best path, only the most suitable one. As long as the path suits the development of your own enterprise, it is a good path.

Although the new house decoration will not start until after the "National Day" holiday, the selection of floor heating has already begun. On the afternoon of the 25th, after a thorough comparison, Ms. Ma determined a model of floor heating equipment at a store on the Ring Road, which she plans to use for her future house decoration. "Many friends around me have already used this kind of floor heating equipment, and they all feel very satisfied, so I decided to include it in my decoration plan before the new house renovation," Ms. Ma introduced.

"Since the beginning of last year, consumers coming to select floor heating equipment have significantly increased, and since entering this autumn, the number of consumers coming for inquiries has been non-stop, and some models of equipment have even been sold out," said a brand floor heating equipment retailer in the city area. As consumption continues to rise, the number of merchants choosing to join this sales category has also increased significantly compared to before.

"Even though there are no specialized floor heating equipment retailers in the market yet, judging from the popularity of floor heating-specific flooring, it is not difficult to see the enormous consumer potential of this market," Vice General Manager Xia Dongsheng of Zhengda Decoration Mall introduced. Especially among young people, whether or not to install floor heating equipment during new house renovation is seen as a fashion of consumption.

After determining the plan for the floor heating equipment for your new house, when selecting accompanying building materials, is solid wood flooring better or tile more suitable?

"As for which type of product is appropriate, it still depends on individual cases. Materials used for floor heating should have good thermal conductivity, stability, environmental friendliness, and anti-deformation properties," a senior designer from Modern Home Decoration Company introduced. And due to these advantages, tiles are an ideal choice for ground materials of radiant heating systems.

"Suzhou residents prefer using solid wood boards in rooms rather than the cool feeling of tiles. When choosing solid wood flooring, it is essential to select professional floor heating flooring instead of regular ones," the person in charge simultaneously indicated. The primary reason is that ordinary flooring accelerates formaldehyde volatilization once heated, affecting the indoor environment quality. Therefore, it is necessary to differentiate during selection.

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