CHINA's COUNTERFEIT CAPITOL NOW MAIN HUB FOR CONSUMABLES ?
CHINA's COUNTERFEIT CAPITOL NOW MAIN HUB FOR CONSUMABLES ?
2011-02-23 at 9:25:47 am #24632
CHINA’s COUNTERFEIT CAPITOL NOW MAIN HUB FOR CONSUMABLES ?
Guangdong fortifies position as main hub for printer consumables
Government support fuels R&D and marketing, and helps makers reduce costs.
Leveraging a comprehensive supply chain for electronic devices, Guangdong province remains the leading sourcing hub for printer consumables in mainland China. Home to three of the country’s four economic zones, it gathers various raw material providers and has a sales network for finished products. Heavy trade influx from Hong Kong and Taiwan has created a bandwagon effect, drawing in investment from foreign enterprises.
Several known distributors of printer consumable parts and components have set up logistics and distribution centers there, including Hong Kong-based Static Control Components. Local makers promoting their own brands such as Print-Rite, Zhuhai Ninestar and Zhuhai Gree Magneto-Electric Co. Ltd are likewise based in the area.
Guangdong currently plays host to about 300 suppliers in the line, representing more than 70 percent of the country’s total. To maintain position, it is directing efforts toward improving the major sourcing center Zhuhai, which has approximately 150 manufacturers and another 120 enterprises providing support services. The city’s denizens hold over 1,000 patents, according to the Zhuhai Printer Consumable Industry Association or ZPCIA.
The provincial government has set up a production and research base in Zhuhai. The latter cooperates with the State Key Laboratory of Fine Chemicals in developing weather-resistant dye-based ink, for which four patents have been applied. In addition, it works with Dalian University of Technology to create chemical carbon and special pigment ink.
The city likewise maintains the International Patent Database of ZPCIA, which was approved by the China Computer Industry Association, and the State and Provincial Intellectual Property Offices in 2008. Two years after, the National Quality Inspection Center of Consumable Materials also passed acceptance check. It is the only state-level body for such products in the country. One phase consists of a laboratory equipped with test devices valued at $2.2 million. The other is a 16,000sqm inspection base in Nanping Technology Park with an allocation of about $7.4 million.
Construction is still in progress, but manufacturers are already optimistic this will reduce verification costs dramatically. At present, suppliers send their products overseas for the checks, and the fee for each unit is at least $30,000. When the center starts operating, they project charges will drop 15 to 20 times.
Zhuhai is also directing efforts toward the promotion of printer consumables. The RemaxAsia Expo has been held there four times beginning 2007, and has become the largest professional trade fair for the line worldwide. The city likewise hosted the Global Remanufacturing Industry General Assembly last year, which is the first joint meeting among majorglobal industry associations.
The other production hubs in Guangdong are Shenzhen, Dongguan, Foshan, Guangzhou and ZhongshanMakers in Guangdong focus on toner cartridges because of healthier margins but continue to offer inkjet cartridges and refills, and continuous ink supply systems. The first accounts for more than half of total output, with black configurations dominating yield. Color models, however, have been rising in number in recent years as prices go down and technology matures. In the last 12 months alone, quotes for the latter have decreased by 25 to 35 percent.
Midsize and small players continue to emphasize the former. At Eagle Flag Supply Ltd, for instance, black versions represent 90 percent of production. Large operations such as Zhuhai Shengmei Electronic Co. Ltd, meanwhile, dedicate about one-third of output to color variants.
Nonremanufactured toner cartridges are expected to gain more steam. In 2010, only about 15 percent of the maker pool rolled out remanufactured ones due to the unstable supply of recycled empty containers.
This year, however, several will develop or expand capacity for the latter because of growing demand from main markets Europe and the US. The type is considered more environment-friendly and helps promote development of the recycling industry. Zhuhai Shengmei said it will start turning out remanufactured units in 1H11, and estimates yield of such products to account for 15 percent of the total by year-end. Zhuhai Gree, meanwhile, has increased the category’s share to 25 percent.
To address difficulty in acquiring a sufficient volume of empty cartridges and ensure quality, makers source from overseas providers, which have more experience in the recycling business.
There has not been much product development in the segment, but several suppliers are incorporating new features in latest releases to improve operability. Zhuhai Mingjia Electronics Co. Ltd, for example, has introduced a model with a hole where users can add carbon powder directly when the lid is opened.
Currently, HP, Canon and Samsung dominate the worldwide market of laser printers. Compatible toner cartridges for these brands therefore rule output in China with a 70 percent share. Brother, Dell, Lexmark, Xerox and other providers account for the rest.
To meet rising demand, especially in emerging markets such as Brazil, Russia and India, more toner cartridges are being rolled out. Makers estimate China’s output rose by 20 percent YoY in 2010, and forecast the trend will persist this year. Ourway Image Co. Ltd, which sends products mainly to the local market, Brazil, Russia and India, said yield in 2010 doubled from two years ago. It expects a 20 percent gain in the next 12 months.
Local suppliers are keeping quotes stable or even reducing them to attract orders. This is despite the rising production costs brought about by the appreciation of the yuan. To bring down outlay, companies are improving manufacturing processes and cooperating with material providers.
Planning to decrease prices by up to 5 percent in 1H11, Zhuhai Shengmei is enhancing efficiency. Zhuhai Mingjia conducts mold making and plastic injection in-house to manage expenses better and shorten design turnaround time. Retech Technology International Ltd, meanwhile, has set up an international procurement department in charge of monitoring the supply of main components.