2020 has been a challenging year for China's Comfort Home industry, but it is projected to grow considerably.
Continuous Release of Market Potentials and More Opportunities for Companies in the Industry
According to Steve Li, GM of Rheem China, the epidemic has fueled the demand for a quality lifestyle, which will influence consumer decision-making and even reshape the lifestyle and consumption focuses of Chinese consumers in the long run.
Comfort Home represents new requirements for comfort and lifestyle. Consumers incline to spend on good reputed products and acclaimed brands. Therefore, the complexity and uncertainty in a market environment are also the best touchstones of the performance of a company and brand.
Rheem entered the Chinese market in 1994. Last year, Rheem Group announced China to be one of the most important regions to promote Globalization strategy, and invested in the construction of an R & D Center and an Innovative Learning Center in Chengdu headquarter. Rheem's products have been designed and built with consideration to all aspects of product performance, installation, maintenance, duration, reliability, and integration. The technologies have developed and functionality it has designed for the various products are almost all centered on the comfort of users and are intended to address the major concerns of consumers.
Focus on Core Competency and Persist in Sustainable Development
The key to capitalizing on the huge demand in the Chinese market and growing the business is an independent innovation and market expansion. Li emphasized that to survive the intense competition in the market, a brand must embody product quality, after-sales service, corporate management, and technological innovation. Rheem has become the first choice of many well-known Chinese brands such as Haidilao and Home Inn for premium central water heating services.
The mandatory national standards for energy efficiency in heating, ventilation, and water heating products implemented in China in 2020 and the Energy Efficiency Standards for the Design of Residential Buildings implemented on January 1, 2021, in Beijing pose higher requirements for an energy-saving design for heating, ventilation, and air-conditioning systems, and define the future trend as green, energy-saving, healthy, and livable.
Rheem has been at the forefront of sustainable development. It has developed a competitive edge in continuous green, energy-saving technological innovation for homeware, for example. In the field of heating products, Rheem will launch the Xclusive condensing combi boiler, which, compared with other condensing boilers, is equipped with a patent 2-in-1compound heat exchanger to realize a high-efficient rate both on water heating and central heating and groundbreaking condensing technology that doesn't require switching valve, three-way motor and secondary heat exchange to realize double condensation of heating water and domestic hot water. In the field of traditional water heaters, Rheem launched the EMAX instantaneous electric water heater, which features small size and high performance, and provides five-fold protection - the highest level of safety standard. In the field of air source heat pumps, Rheem's 1.5P integrated built-in 180L water tank achieves the first-level energy efficiency and fully meets the needs of apartment residents for convenient use of domestic hot water.
Rheem keeps optimizing the production system in the process of product innovation to minimize the impact on the environment and empower customers and employees to work and live sustainably. It's also part of its sustainability goal: Designing for Zero Waste.
Rheem will implement the following three strategies until 2025:
Degrees of Innovation: Launch a line of heating, cooling, and water heating products that boast a 50% reduction in greenhouse gas footprint.
Degrees of Efficiency: Reduce greenhouse gas emissions by 50% and achieve zero waste to landfill in global manufacturing
Degrees of Leadership: Rheem will train 250,000 plumbers, contractors, and key influencers on sustainable products
The consumption upgrade and consumers' increasing environmental protection awareness have further customized and segmented the needs for water heating and heating products for both residential and commercial use. In response, Rheem will keep consolidating the foundation, focus on the core businesses and product lines, and strive for quick breakthroughs.
Last year, Rheem has upgraded and transformed the R & D laboratory and assembled an R & D team. For the year ahead, Rheem will further improve product planning, expand the R & D system, and more importantly, deliver quality product solutions and services. Li emphasized that Rheem's R & D team will not only serve the Chinese market but also the global market. Meanwhile, Rheem will devote major efforts to four categories - gas combi boilers, domestic heat pumps, commercial water heating products, and commercial boilers, develop cutting-edge technologies, and make a profit from these core businesses.
Pursue Market Expansion and Robust, Innovation-driven Growth
The emergence of the huge mobile Internet community has given rise to a new channel in the Chinese market. The Comfort Home Industry is a traditionally offline industry, but offline sales were impeded during the COVID-19 pandemic in 2020 when many brands and distributors turned to e-commerce platforms and achieved good sales. In this context, Rheem will prioritize e-commerce channel development, accelerate digital transformation, leverage the Internet technology to build comprehensive online platforms and channels, strengthen innovative and coordinated development in marketing models and channel reforms, and strive for new business growth through new channels in 2021.
Li summarized the operational strategy of Rheem into three points: Invest to Grow, Innovate to Lead, and Deliver on Commitments. They encompass the focuses of the company in channels, products, operations, and team building.
Invest to Grow: Rheem invested the most in Rheem China over the past year than it has in the past decade and Rheem will continue to increase investment, further explore the online and offline channels, expand the customer base, and deepen market expansion in China in 2021
Innovate to Lead: Rheem was founded on the principles of innovation and today that continue to be its growth engine. R & D is the top priority of Rheem's innovation efforts. The establishment of the China R & D Center has created a platform for the company to enhance product R & D. This year, Rheem will continue to improve the local R & D capacity, and strengthen local product planning and design.
Deliver on Commitments: the core of integrity-based delivery lies in the Chengdu plant, which has evolved into a world-class factory for the production of tank-type products through continuous, repeated iteration, investment, and the launch of new production lines. Based on rich experience, a large number of loyal, senior employees, Rheem has developed a competitive advantage in products that can hardly be overtaken by competitors. Recently, Rheem has strengthened the supply chain function and prepared itself for new challenges through upgrades and reinforcement of both the internal and external supply chain.
Following the three guidelines, Rheem will continue to stabilize the operations, seize every opportunity to pursue robust, innovation-driven growth, and achieve healthy development through the creation of shared values with partners. 2021 will surely be a fruitful year for Rheem!
Rheem China 4008869119
SOURCE: Rheem China
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