February 22, 2025

Market Analysis: Hardware Industry Upgrades Are Imperative

“The oil price has risen again. For the hardware enterprises that apply refined oil to raw materials, it means that the production and operation costs will increase again. The high oil price will increase the cost pressure of hardware enterprises in the short term. From the relationship between crude oil price and value, the oil price is obvious. Higher than the marginal cost of hardware industry production. Due to fierce competition, the hardware industry has poor price performance to the downstream, but high oil prices directly lead to rising production costs, and the industry gross profit is quickly compressed by high oil prices. The continuous high oil price makes the hardware industry use oil costs. The continuous growth has a profound impact on the development of the hardware industry." Recently, Hu Mou, a seller of hardware tools in the hardware city, said.   It is reported that this rise in oil prices will directly lead to a rise in the cost of hardware companies by a few percentage points. For those high-energy hardware companies, the cost pressure will be even greater. The rise in oil prices will lead to a series of rising prices of raw materials, and the production costs of enterprises will increase without limit, which poses a severe test for the survival and competition of enterprises. With the step-by-step upward adjustment of refined oil prices, enterprises will be forced to adjust their industrial structure and save energy and reduce emissions. Promote industrial upgrading with the hands of the market and eliminate high-energy-consuming industries. In addition, the rise in oil prices has indirectly increased the logistics costs of hardware companies. It is understood that oil prices account for one-third of the logistics costs of hardware companies, and the cost of hardware enterprises to spend on logistics costs is not small. Therefore, the increase in oil prices has a great impact on the logistics and transportation of hardware companies. During the author's visit, many sellers have frankly stated that the rise in oil prices is not only the only factor that plagues the development of enterprises. In the face of rising energy prices and rising labor costs, RMB appreciation, and power shortages, traditional hardware processing companies are experiencing “pain” in product upgrades and structural adjustments. Li, a security door dealer, told the author: "Although the state has been taking various measures to stimulate domestic demand and stabilize external demand, it has also issued a series of measures such as raising export tax rebates, but the impact is limited, and not all hardware companies benefit. In the national policy. Therefore, if enterprises want long-term development, they must pay attention to their own development, promote the adjustment of industrial structure, and accelerate the upgrading and transformation of product structure by strengthening technology research and development and innovation. “Adjusting the economic structure of hardware industry and improving the market competition of hardware products. It is imperative to speed up the upgrade of the hardware industry.

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