Research On Product Line Integration In Tiantai Welding Material Company

Chinese manufacturing Purchasing Managers’ Index(PMI) continues to below Withered flourish line about 50%; Chinese entrepreneurs on the economic outlook could not help and produced some worries; but just six months after the recently announced in February 2016 that the index for the first time 50.7, but the new orders index was ten months since, for the first time fell below the 48.5 line ups and downs. To some extent, China’s economy has not completely come out from the shadow of the crisis in the past, "structural adjustment" economic imperative. From a variety of materials directly related to enterprise point of view, in recent years, labor, land, environment, energy and other factor costs rising rapidly, China’s manufacturing development difficult, increasingly slim profit margins. Made in China in a globalized competition has been increasingly difficult, the intensity of competition also allow entrepreneurs are increasingly choking.Tientai(Kunshan) Co., Ltd.(hereinafter referred to as "day Thai company") is mainly producing all kinds of welding materials, more than 400 customers worldwide, about 900 kinds of products. As enterprises continue to develop and grow, orders increased year by year, product variety, within the limited scope of supply of resources, looting productive resources, rob funds used a variety of internal strife and other key customers could not pay for the goods, high value-added the goods could not pay. Faced with new and old customers and old products superimposed on the existing facilities and capacity basis, if you want to meet all the needs of all orders, you need to add more equipment, personnel, funds and so on. In the face of opportunity, especially in the highly uncertain economic environment when it is defensive or offensive? Or, are there better options?Enterprise and product life cycle characteristics are present, so going concern of its development product structure also has its different stages, and each stage of the mission and direction is not the same. In the development process of going concern, on the one specific point in time, there will be a certain product profitability, growth potential, etc. are each different state. Some products have been developed for a long time sales, competition in the market has been quite intense, sustained profitability even turning point; while some products just developed, is on the rise, the needs of enterprises with more resources to take care of it is possible some of these products in the future will grow into a rising star enterprise, the future profit growth point and so on.Through detailed analysis of Tiantai Company’s products, combined with the Boston matrix, as well as the 80/20 rule, re-integration of the product line, and encounter, survival of the fittest, to protect both the profit contribution of key products, while supporting good stars of tomorrow. The main focus needs to break down integration are summarized as follows: 1 screening key products, provide the basis for the allocation of resources focused on the inclination of existing products require the full support of the star; 2 tap potential products, increase the potential for future resources into products. and grasp the future growth, long-term development for enterprises to prepare; 3. elimination of low growth, low-contribution product, release of production capacity.Only through product sales and profitability of the change analysis, portfolio segmentation, to clarify and further analysis of potential product-specific differences in the stage, sustainability and future development, provide more quantitative data to support, become one of the key means of enterprise product line restructuring. Only through systematic analysis to enable enterprises to focus on select product lines with abandon in the survival process, so that the election has its reason, also abandoned hearts to understand. Also apply analytical methods normalized, establish long-term track response mechanism, timely adjustment of model parameters and to respond to market changes, avoid excessive overkill cited law emerged.Finally Again, the product line is not to make a judgment for the Integration of room for future growth products, so we are now based on the structure, with emphasis on product differentiation within the existing factory resource allocation priority level, the allocation of resources to focus on contribution tilted, eliminated low contribution products.