What are the sales models of LED displays? Currently, LED display companies typically fall into two main categories: engineering channels and wholesale channels. The engineering model targets projects directly, offering higher profit margins but with fewer opportunities and greater risks. On the other hand, the wholesale model involves dealers or agents, which is often preferred by smaller to medium-sized manufacturers. However, as the industry becomes more concentrated, larger companies are increasingly entering this space, making competition fiercer. While the volume is high in the wholesale model, the profit margins tend to be thinner.
The sales structure of the display industry mainly consists of two major approaches: engineering and wholesale. The engineering model focuses on direct project-based sales, where manufacturers either engage directly with customers or through bidding processes. This means that the product doesn't need to go through third parties. These channels are usually straightforward and make up a significant portion of the market. So far, the majority of LED display applications still rely on engineering channels, especially for full-color screens, where manufacturers bid for projects based on their industry relationships and influence.
LED display projects usually involve product design, installation, and after-sales support. Due to the limited number of such projects, along with high investment and long return periods, dealers play a smaller role. As a result, the channel structure in this sector remains relatively simple. In contrast, the wholesale model includes both agents and distributors. Manufacturers supply products that are then sold through a nationwide network of dealers. This approach helps companies quickly expand their market presence and reduce financial risk. To gain more market share, many display companies continue to grow their dealer networks, leading to rapid development in the wholesale segment.
However, financial risks remain a major challenge for the LED display industry. Profit margins are often low, and companies face pressure from multiple layers of collateral. Many businesses are forced to adopt the wholesale model due to these constraints. Overall, both engineering and wholesale models have their own advantages and challenges, and the choice between them depends on the company’s size, resources, and strategic goals.
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