Zhongfu Industry Competitive Strategy

Henan zhongfu Industry Co., Ltd(Hereinafterrd to as "Zhongfu"),established in December1997, is a foreign investor holding company with main business of scientific research, industrial and commercial trade. Zhongfu,one of the seven aluminium companies greatly supported by Henan provincial government, takes aluminium production as it core industry and have entered into the list of The Top500Enterprise since2008.Aluminium industry of our county has sprung up and developed rapidly in recent years. Now its expansion has created a passive situation: production capacity is overflow,market is saturated, and importing reliance of related resources is increased year on year. This forced the county to convert its policy from encouraging development into taking control over new constructions. As the macro-control policies introduced continuously, the aluminium industry of china will be confronted with a situation more complicated. Zhongfu should make a compatible strategy to ensure the success of the aluminium industry in despite of the fierce market competition.This article based on thoroughly understanding of Zhongfu’s development history and current status, combined with macro environment of the national and worldwide trend of the aluminium industry, uses the analysis methods of PEST、 SWOT and The Porter Five Forces Model Analysis, and studies the threats,the opportunities, the strengths and weaknesses of Zhongfu. A conclusion is therefore arrived as below:Zhongfu has the strong comprehensive strength of strong R&D ability, high-level equipments, advanced production technology, strong financing platform. Meanwhile, but it also has disadvantages, such as high-dependence on resources, high environmental protection pressure, simple product mix and short industry chain; It is a good opportunity to the company in the respects such as macro-economic recovery, downstream demand and the policy support from the local government, but it also meeting threats from intense market competition,the pressure from energy conservation, increased raw material prices, the tightening energy policy, etc..After the study, the paper comes to the development solution as:Although the aluminium industry as a whole is facing a grim situation, Zhongfu is still very promising. We are confident that it will win the competition, as long as it grasps the opportunity, avoids risks and effectively implements a vertical integration competition strategy. I hope to that I can share valuable experiences with business partners.