Kingston Responds to Price Rise: Loss of Control over Channels is the Scourge

The earthquake in Japan has caused Kingston dealers to issue a “accidental financial loss”. The Kingston official who is an American multinational company has not been responding to and guiding the price increase in the product market. The public opinion criticizes that it "disregards public interest and lacks social responsibility."

More than a month ago, "China Enterprise News" published an article entitled "Businesses' Hype Acknowledged by Kingston for Accelerating Price Increases", and conducted the Kingston-led memory bar and U disk price increase action in the Chinese market after the earthquake in Japan. After investigation, it was discovered that only Kingston in China had a price increase of up to 30% in a matter of weeks in the global market, and Kingston officials did not respond positively to the fact that their distributors “borrowed the earthquake speculation price”.

Recently, at the participation in the Beijing International Photographic Equipment Exhibition, Kingston Greater China Business Marketing General Manager Guo Meifen received an interview with the “China Enterprise News” and other media on issues such as the price of memory and other products after the earthquake, and for the first time responded to “Kingston’s rise. Price door."

Enterprise: The commercial owner Guo Meifen said: “The price increase behavior in the previous period was only the behavior of individual dealers. There was no regular price increase in Kingston’s regular sales channels.”

For many retailers on the market from Kingston to dealers to pick up the goods, suffered "price increases, the number of control" and other circumstances, Guo Meifen analysis pointed out that "after the earthquake, Kingston and Japanese suppliers lost contact in a short period of time, Therefore, customers of the channel have questioned the manufacturer's ability to supply at the time, and at the same time, the mobility of mobile storage products is very easy to speculate on itself, and they are bought and sold as futures, so after the earthquake, because of some speculators Existence, product prices, reluctance to sell will follow."

However, the information previously reported by the “China Enterprise News” reporter in the interview was that when retail stores and individual industrial and commercial households were all picking up goods from Kingston authorized dealers, they encountered “price increase, reluctance to sell” and other situations.

"Actually, the earthquake in Japan basically did not affect Kingston," said Kwok Mei Fen. Kingston's safety inventory can absorb the impact of this sudden incident on sales. Kingston follows the market in terms of supply and sales. Order to operate.

However, Guo Meifen also admitted to the media, "After the earthquake, Kingston's product prices have a 10% amplitude."

Experts: It is reported that channel management needs to be strengthened. Kingston’s sales in the Chinese market are mainly covered by the four national agents. The wholesale and retail network developed by the agents distributes layers of goods. Finally, mutual competition is controlled by the competition between agents. The result of supervision, in order to ensure a reasonable price definition.

However, consumer electronics channel expert Hong Shibin pointed out that "for many years, foreign-funded enterprises have faced a chronic problem of channel control in the Chinese market. In particular, adopting the "National Generation" like Kingston (that is, choosing several agents? a href="http:/ /weibo.com/1689363804”target=”_blank” class=“akey”>Tan Zhi’s “sell” model, it is difficult to make more efforts for agents, distributors, and even retailers. Good supervision."

It is reported that after Nokia adopted the "national generation" model, the market control power and product pricing power were abducted by agents, triggering a series of market competition disorders such as "cross-province stocks, low-cost selling". In this regard, Hong Shibin pointed out that “from the national generation to the provincial generation, to the local level direct business is the only channel model for the healthy development of foreign-funded enterprises in China. At present, the channels of domestic consumer electronics companies have achieved county-level direct distribution of township-level businesses. Is to strengthen the control of the company's channels."

Feng Hongjiang, a visiting professor at Zhejiang Wanli University, pointed out: “It is difficult to guarantee that this round of price increase in Kingston in China is not a staged price hype by Kingston agents. Once businesses become bigger and stronger, it is easy to control upstream manufacturers. It will even create contradictions and conflicts with the manufacturers in terms of management methods and methods."

“Actually, price increase is a mutual benefit maximization for Kingston manufacturers. The reason why Kingston did not make a positive response to the price increase in the Chinese market some time ago may be the pressure on some agents. After all, Sometimes foreign-funded enterprises also have to look at the faces of businesses," said Hong Shibin.

It is urgent for Kingston to strengthen channel control and promote channel changes. At present, Kingston is promoting "reliable shop" certification, has formed more than 200 assured stores and more than 40 service centers in China. Guo Meifen stressed: "This certification is not a charge, it is to maintain the consistency of the Kingston brand at all levels of the market, to avoid the emergence of fake sales, wanton fare increase, reluctant sellers."