Successful Idea for Business of the Future: LED Distribution

60329, Frankfurt am Main (Germany), March 31, 2016 (Newswire.com) - ​The main category that comes into our minds when we think about business ideas is the future demand for goods or services we are going to offer our clients. Essential commodities like food, water and light must be a total success. That’s why many businessmen go for LED lighting distribution, because it is a new generation of goods of first priority.

What do the electronic giants think?

Please, can you tell us the reason of rejection

Many global consumer electronics manufacturers such as GE and Philips were the first to react when the blue light-emitting diode was introduced. This invention made LED lamps more applicable for home use and represented the screw-in LEDs birth. And this business idea appeared to be something bigger than just a trend. LED’s popularity grows annually along with manufacturers and distributors profits. Philips CEO Frans van Houten announced that their LED lighting sales were up by 21 per cent in 2015 due to increase of LED’s share on 6 per cent.

But still there is a place for young LED producers whose approach is more personal. That is what electronics giants lack so much. Filling in the niches with what can be called “gourmand” lighting, they are satisfying the particular needs that have been neglected by others.

Lean model for success in LED business

It’s proved by practice that the manufacturers are not those who make big money with less expenses and risks involved. Stock-and-sell cycle is much longer for them, and their overheads are much higher. LED lighting Distributors can achieve greater profit margins as the trade margins exceed those of conventional lighting. It is easier for them to change the margins and react to market changes.

Despite having such advantages at the start, it is still important for distributor to choose product that will fit in targeted market. For example, European consumers crave for more sophisticated light bulbs with outstanding lighting characteristics. If this is what you want to offer clients you may be attracted by a new lighting manufacturer from Eastern Europe, Jooby. Their lamps show high quality and energy efficiency standards and the pricing is more reasonable. As a company is quite young it is only developing its distribution system, so you can be the lucky one to get the special conditions.

Is LED business so flawless?

Of course not. Among top drawbacks of this business is high competition due to fast market growth. The paper of Research&Marketing group states that the global LED market is due to show a CAGR of about 10.1% within next decade to reach approximately $61.2 billion by 2025. Such obstacles may push away some businessmen, but those who manage to find their niche will be able to cherish the profits soon.

Sustainable developments in our everyday life have created the excessive demand on LED lighting. Its penetration is expected to be as high as 70 per cent by 2019. LEDs’ popularity grows faster as their cost drops. And it is definitely worth plunging in at this precocious stage to “snag a couple of good seats”.

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