Strategic relocation of the lighting industry chain
Published Time:
2021-08-03
The Pearl River Delta was once a prime location for business survival and growth. However, after 30 years of economic reform, its advantages in land prices, taxation, labor, and logistics have been largely depleted. Businesses now carry a heavy burden; while output may appear high, profit margins are in reality extremely thin.
The Pearl River Delta's advantages are fading, and LED lighting companies are seeking new opportunities in Jiangxi
The Pearl River Delta has been a prime location for business survival and growth. However, after 30 years of economic reform, its advantages in land prices, taxes, labor, and logistics have been largely depleted. Businesses now carry heavy burdens; while output may seem high, profit margins are actually quite thin.
Some companies seeking relocation have also observed nearby provinces such as Hunan, Jiangxi, and Guangxi. They find Jiangxi's abundant resources, low comprehensive factor costs, and favorable investment environment conducive to large-scale industrial transfer.
Jiangxi currently benefits from preferential policies related to "Western Development," the "Poyang Lake Economic Zone," and the "Red Base Area." From a business perspective, the prices of labor, land, industrial electricity, and water are particularly attractive compared to the Pearl River Delta. In terms of taxation, in addition to the "three exemptions and two reductions," there are tax rebates and incentives, which are very appealing to businesses. For a company paying 50 million yuan in taxes annually in the Pearl River Delta, these tax exemptions, reductions, and rebates can translate into significant profits. In terms of logistics, Jiangxi has a comprehensive land, sea, and air transportation network, as well as inland waterways connected to the Yangtze River. Cities like Ganzhou, Xingan, Wanzai, and Wuning in Jiangxi are building or have already built large lighting markets and production bases, providing sales channels for lighting companies that relocate there.
Shenzhen Eitong Automation Equipment Co., Ltd., a leading domestic surface mount machine company, has been closely cooperating with several large listed companies to develop a lighting industrial park in Jiangxi.
In addition to these "hardware advantages," Jiangxi's pragmatic government approach is another reason for companies to invest there. A company from Huizhou reported to the author that after multiple visits to Xingan and other areas in Jiangxi, they witnessed the government's pragmatic style and efficiency, which ultimately led to their investment decision.
In anticipation of the industrial transfer of lighting companies from the Pearl River Delta, Jiangxi has taken proactive measures. Many cities have established dedicated lighting industry offices to handle investment attraction and provide services to incoming companies. Some city leaders have even led delegations to Zhongshan Guzhen and Shenzhen to hold investment promotion meetings and introduced various preferential policies for relocating companies.
Shenzhen Eitong Automation Equipment Co., Ltd. has launched several models of flight identification general-purpose high-speed surface mount machines However, objectively speaking, although Jiangxi has significant advantages in receiving industrial transfers from the Pearl River Delta, many companies still only have a "wait-and-see" attitude, and remain concerned about the comprehensiveness of industrial support.
For Jiangxi to become the top choice for receiving lighting industry transfers from the Pearl River Delta, it needs to show companies how they can profit and address the issue of supporting industries. Since this is a transfer of an entire industry, not just individual companies, Jiangxi should actively support businesses in areas such as finance, logistics, industrial support, employment, and government services to successfully receive the lighting industry transfer from the Pearl River Delta.
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