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Zhanchen's 30 years of report series (2): two curves extend at the same time

In his speech on the 30th anniversary of Zhanchen, Chen Bing, chairman of Zhanchen, still mentioned "Twenty Years of Zhanchen" published 10 years ago; The special chapter in the book describes the "20-year memorabilia" of Zhanchen, and the last record is the foundation stone of the R&D Center Building of Zhanchen Coating Group (today's Zhanchen Building) in 2014.

Zhanchen's 30 years of report series (2): two curves extend at the same time

Today's Zhanchen Building

As we said in the preface of the series of reports, "Twenty Years of Zhanchen" has made a faithful record of two-thirds of the history of Zhanchen to the present, and its restoration of all aspects of the development of the enterprise in the first 20 years has not left room for those who come after it to transcend. Therefore, in the 30th year of Zhanchen, we need to focus on the offensive performance of Zhanchen in the last 10 years.

In fact, from 2015 to 2024, it will be 10 years of pressure for Zhanchen - the transformation of environmental protection is still on the bow and has become the "responsibility" of the normalization of the enterprise; The furniture market has entered a period of adjustment, and the "inflection point theory" is very loud and spreads to the furniture paint market; The outbreak of uncertainties has made the entire coating industry and even the economic environment full of challenges - on the basis of adhering to the original development route, the search and laying of the "second development curve" has become the main line of this period.

Zhanchen's 30 years of report series (2): two curves extend at the same time

Memorabilia from 2011 to 2023 (picture taken from the official website of Zhanchen Group)

In the past 10 years, how has Zhanchen adjusted its pace, kept up with the pace of environmental changes, achieved a relatively stable transition and development of the enterprise, and set the tone in advance for the next 30 years of "looking back"?

Headquarters Factory Relocation:

"A new era of development"

Since the establishment of the first factory at the foot of Niushan Mountain in Shenzhen in 1994 (it was later moved to a place not far from Niushan, we collectively refer to it as the "Headquarters Factory"), Zhanchen began to implement and complete its national production layout in more than 10 years in the new millennium.

In 2001, the Shanghai plant was completed

In 2008, Qingdao factory was established

In 2010, the Chengdu factory was completed

In 2013, the Fuzhou plant was put into operation

Zhanchen's 30 years of report series (2): two curves extend at the same time

Today, Zhanchen has 6 factories in China

However, on the one hand, the national layout of the production base was drastically carried out, and on the other hand, the headquarters factory was under the pressure of relocation - this pressure was not only "exclusive" to Zhanchen, including the rise of Chinese private paint companies at the same time as Zhanchen (most of them were gathered in Shunde at that time), as well as those more traditional old paint companies, factory relocation is also a major issue.

It's just that it is at the forefront of China's reform and opening up, and the relocation of Zhanchen's headquarters factory is even more urgent——

On the one hand, more than 10 years ago, Shenzhen's districts accelerated industrial transformation and upgrading, restricted and gradually eliminated a number of low-end manufacturing industries, and the traditional economic strong zone Bao'an (where the Zhanchen headquarters factory was located originally belonged to Bao'an District, and now belongs to the newly established Guangming District separated from Bao'an District), Futian and other areas took the lead in starting industrial transformation; On the other hand, it is also the need for Zhanchen's own development and upgrading - due to the limited development of Shenzhen factory, many development plans are difficult to implement, and Zhanchen is also in urgent need of a greener and more intelligent factory to promote the further development of the enterprise.

This has become one of the backgrounds for Zhanchen to start the construction of the headquarters building. It has always been considered that the coating of hazardous chemicals, its production plant will inevitably be listed as a low-end manufacturing industry and become the object of Shenzhen's restriction and elimination, Zhanchen hopes that through the construction of the headquarters building, the corporate headquarters will be left in the initial departure of this land, and gradually realize the business model of separation of headquarters and headquarters factory.

On August 12, 2015, a loud bang in the dangerous goods warehouse of Tianjin Port Ruihai Company accelerated the pace of chemical plants across the country to move out of the main city. In Shenzhen, where every inch of land is at a premium, there is no room for chemical factories - for Zhanchen, the relocation of the headquarters factory is also imminent.

Zhanchen's 30 years of report series (2): two curves extend at the same time

Aerial view of Zhanchen New Material's Zhuhai factory

The Zhuhai factory came into being. It is a production base established by Zhanchen to comply with the requirements and trends of national environmental protection industry upgrading and undertake the relocation and transfer of production functions of Shenzhen factory. It started construction in March 2016 and started trial production in November 2018, marking the "opening of a new development period" for Zhanchen.

Industrial paint first:

Layout of "full line of coatings"

The process of relocation of the headquarters factory is also a process of Zhanchen's continuous thinking about the development direction and adjusting the development strategy.

As early as the beginning of its establishment, Zhanchen realized that the real market highland of the paint industry lies in the field of industrial paint, and made long-term preparations for this - although the traditional furniture paint is also regarded as a category of industrial paint, in the early stage of development, Zhanchen, like other Chinese private paint companies, was limited by various objective factors and failed to expand its business to the industrial paint market.

It was not until 2015 that the Zhuhai factory project gradually took shape from the idea that more development plans of Zhanchen were implemented in great strides, the focus of which was on the industrial paint business - this year, Zhanchen announced that it would enter the field of industrial paint, and officially launched the industrial paint to the market on July 7, 2016.

Zhanchen's 30 years of report series (2): two curves extend at the same time

On July 7, 2016, Zhanchen Industrial Paint held a product launch ceremony

In 2017, Zhanchen repositioned its own development and established the long-term goal of "being an international public company with a full product line of coatings". Obviously, the emergence of industrial paint business is an important part of Zhanchen's goal of "full product line of coatings", which has become an important part of Zhanchen's diversified business layout together with furniture paint and the architectural paint brand "Classic" that has been laid out for many years.

At that time, the development environment of China's coating industry was facing a new round of transformation and upgrading pressure. Traditional old paint companies lack innovation in the field of industrial paint, and it is difficult to compete with international giants in the open market; In the field of civil coatings (including architectural coatings and furniture paints that gradually take off industrial attributes) dominated by private coating enterprises, competition tends to mature and market space declines, which also forces enterprises with pursuits to find another way; And "civil industrial paint" has become a common "test site" for many paint companies, and Zhanchen is just one of them.

Zhanchen's 30 years of report series (2): two curves extend at the same time

The industrial paint business displayed in the exhibition hall of Zhanchen New Material's Zhuhai factory

Clarifying the direction of development, as well as relying on the trial production of the Zhuhai factory, Zhanchen has strengthened its confidence in the development of industrial paint - in December 2019, the smooth operation of the industrial paint production workshop of the Zhuhai factory announced the acceleration of the development of Zhanchen New Material's industrial paint business.

For Zhanchen, industrial paint is its "second growth curve" towards a new stage of development, in the domestic furniture paint market development into a period of steady growth, and even the emergence of "inflection point theory" background, the rapid growth of industrial paint business to Zhanchen's development potential to form a strong supplement. Relevant data show that in 2023, Zhanchen industrial paint will grow by 30%, and it will establish the goal of entering the first camp of domestic industrial coatings in the next 2-3 years, and at the same time become a leader in water-based and green coatings; In the next 8-10 years, Zhanchen will point to the first camp of industrial coatings and compete with international first-line brands.

Zhanchen's 30 years of report series (2): two curves extend at the same time

In March 2023, Zhanchen adhesive product series asked

In 2023, Zhanchen adhesive product series will be fully launched. For Zhanchen, this is another layout of business diversification, and at the same time provides assistance for the development of furniture paint business.

Go to sea to build factories for development:

The international route leads the industry

If the industrial paint business is the "second curve" of Zhanchen's layout outside the core business (furniture paint), then in the furniture paint field, it has created a "second route".

As mentioned above, in the past 10 years, the development of the domestic furniture paint market has once appeared "inflection point theory"; This "inflection point" first appeared in the furniture market, and then spread to the upstream furniture paint market.

When the "inflection point" is critical or comes, whether it is a furniture company or a furniture paint company on the supply side, it is necessary to have the courage and preparation to face it frankly - this is also one of the pressures on furniture paint companies such as Zhanchen, and it is also the driving force of its development of the "second curve".

However, developing a "second curve" is only one of the options, and the nurturing of any new business requires a process; For Zhanchen, who has been deeply involved in the furniture market for more than 20 years, sticking to the furniture paint position and seeking sustainable development is still the "best solution" at present.

Zhanchen's 30 years of report series (2): two curves extend at the same time

Zhanchen Viet Nam factory, which is also the first real overseas factory of a Chinese private paint company

In this context, the trend of furniture companies going overseas provides inspiration for Zhanchen. More than 10 years ago, some Chinese soft foam furniture manufacturers went to Southeast Asia, especially Viet Nam, to build factories, and brought relevant raw material suppliers to go together; Viet Nam is also actively undertaking industrial transfer from China, and since 2016, Viet Nam has continued to introduce preferential tax policies to encourage foreign investment.

After 2018, with the continuous deepening of international trade frictions, the phenomenon of furniture companies going overseas to build factories has become more common - including Markor Home, Gujia Home, Minhua Holdings, Qumei Home, Aili Home, Nature Home, Dream Lily and other furniture head companies have also successively built factories in Viet Nam, many of which are customers of Zhanchen.

Zhanchen has always pursued the "dedication to customer success", under the premise of maintaining the stable development of the "first curve" and maintaining the competitive attributes of "the first track", if you want to seek greater development, there is no reason not to follow customers to go to sea to find opportunities!

In August 2016, Zhanchen announced that it would establish an overseas business department and began to recruit overseas business leaders. In the same year, Viet Nam Zhanchen set up a project, launched market research and set up a Viet Nam office, and set up a Viet Nam team; In 2017, Viet Nam Zhanchen was registered and officially put into production in December; In 2018, the business in Viet Nam started.

In 2019, under the background of intensifying international trade frictions, most of the orders of furniture factories were transferred to Southeast Asia, and Viet Nam Zhanchen successfully undertook these orders, so as to move towards more rapid development. Up to now, Viet Nam's annual sales have exceeded 200 million yuan; After 2024, Viet Nam Zhanchen will start the production and sales of industrial paint.

Zhanchen's 30 years of report series (2): two curves extend at the same time

Thailand Zhanchen opening ceremony

With the success of Viet Nam Zhanchen and following furniture companies to expand their business to Thailand and other Southeast Asian countries, Zhanchen has once again laid out - Thailand Zhanchen was established in 2020, prepared in September 2022, and registered in December; It will be officially put into operation on July 7, 2023.

As Zhanchen's second production base in Southeast Asia, Zhanchen Thailand and Viet Nam Zhanchen unify resources and management to provide convenient services for the furniture market in Southeast Asia.

End

It is not difficult to find that compared with the development of the previous 20 years, Zhanchen has performed more mature in the last 10 years - despite the profound changes in the coating industry, the furniture industry and even the entire economic environment, and the continuous development pressure of the enterprise, Zhanchen still calmly copes.

In addition to the continuous "confidence investment" in the implementation of the core furniture paint business, we can regard the development of industrial paint and the construction of overseas factories as the most important route layout of Zhanchen in the past 10 years, and it is also the initial stage of Zhanchen's long-term goal of "being an international public company with a full product line of coatings".

Zhanchen's 30 years of report series (2): two curves extend at the same time

Or it can be said that whether it is the first 20 years or the recent 10 years, Zhanchen has stepped on the rhythm of industry development - which makes its future development more imaginable. In the paint industry and the furniture industry are showing a new development format in the background, Zhanchen relies on the extension of the two curves, will be stable and far-reaching, win in the present, and win one after another "30 years".

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