Steady rise in demand for products
Looking at the general cable collection of mobile in recent years, we can find that the demand for general cable collection is steadily increasing. Benefiting from the construction of fixed-line broadband, anti-dumping and other benefits, the domestic optical fiber and cable industry is still in the boom development cycle of the volume and price increase before the second half of 2018. 2018 second half to date, due to overcapacity, price competition and other reasons make the industry development slow down.
From this year's tender documents can be found, mobile this general cable collection compared to 2019 demand rose by more than 36%, compared to 2020 more than 20%. This is inextricably linked to the mobile and even the three major operators' development plans for 2021 - 5G construction, "double gigabit" network infrastructure construction, FTTR and other developments make the operators' demand for fiber optic cable further enhance.
价格盼重获新“升”
In the past two years, operators every fiber optic cable collection can not be separated from the "price" of this topic, compared to the obvious increase in demand for general cable, can be found in this general cable bidding unit price and the previous year almost flat; and from the maximum price, compared with last year, the highest bid limit price is the same as the purchase scale growth, an increase of 20%. Although the price is basically the same, this bidding document still reveals different information. From the table, we can find that the share distribution of this collection still continues in the past, with the top five occupying more than 70% of the share. However, compared to previous years, this year's vendor share gradient tends to level off, moderating the price competition between vendors to a certain extent。
It is worth noting that last year, price scoring accounted for 50%, while this year it is 40%. At the same time, the scoring method uses the "downward guided median price method", compared to last year's "conditional inverse ratio method", the downward guided median price method can reduce the impact of irrational competition to a certain extent, the bid price in the abnormal range scores lower, while in the normal The difference between bids in the abnormal range and those in the normal range is not significant, thus guiding vendors to make rational bids。
In addition to this, the terms of this tender have added a price linkage scheme for mobile, where the raw material triggers a product price linkage mechanism when the arithmetic average of the raw material exceeds 10% of the base price of the raw material in the previous quarter. To put the scheme in a nutshell, if the price of raw materials increases by more than the 10% threshold set by the operator during the bidding exercise and production by the winning enterprise, the enterprise may increase the price of the product according to the specified percentage. The price linkage scheme reduces the risk of raw material price increases that the successful bidders may encounter in their production.
From this information, it can be found that the adjustment of this tender document has to a certain extent weakened the possibility of irrational competition, enabling manufacturers to treat this tender more rationally and promoting orderly competition in the industry.
The unveiling of tender documents and the fine-tuning of China Mobile's bidding rules have released a "benign" signal, providing certain conditions for price increases. But the adverse effects of the industry's "irrational competition" in recent years are still fresh in our minds, so how can we not reflect on this? The lessons are not far away. After the baptism brought about by the sluggish development of the market, the fiber optic cable industry is in dire need of a price increase to "save the market". From this tender document to see the operator to make a series of adjustments, but the final tender results will have to wait for the actual bids of major manufacturers.
The entire fiber optic cable industry can be said to be "one glory, one loss, one loss." The "price increase" is not only for the general cable bidding adjustment and the conclusion, but also for the whole industry chain of healthy competition appeal. Operators each tender price, not only affect the fiber optic cable manufacturers, but also on materials, equipment companies and other upstream and downstream enterprises in the industry chain, so healthy industrial competition can promote the sustainable and healthy development of the entire fiber optic cable industry. The adjustment of the tender, for the "price" provides the possibility of fiber optic cable manufacturers to seize this opportunity to discretionary quotes, or to change the status quo of the industry.
Overall, the price increase or the domestic fiber optic cable market recovery must be the road, and the price increase, can bring a series of changes - operators bidding price increase, improve the profits of manufacturers, which can lead to the benign development of the entire industry chain, thus promoting the fiber optic cable industry back to a healthy development track, which is also all the industry eagerly awaited.