Overseas Sales Pressures Coming Up for Chinese Kitchen & Tableware Suppliers, According to Global Sources12 Jun 2012 • by Natalie Aster
Kitchen and tableware suppliers in China will have to prove their mettle as 2012 brings both internal and external pressures affecting overseas sales.
According to the report “Sourcing Report: Kitchen & Tableware” by Global Sources, the debt crisis in the US and Europe is putting a damper on demand. This is the main reason export growth is foreseen to slow down this year. Some product categories showed a minimal increase in the quantity of 2011 shipments. Others have begun to decline.
Sourcing Report: Kitchen & Tableware
Published: April, 2012
Price: US$ 350,00
Pricing is another key factor contributing to fewer orders. Most suppliers are raising quotes to offset higher manufacturing expenses and the appreciation of the yuan, but meeting resistance from buyers.
In response, companies are adjusting their business strategies to prop up sales and remain profitable. R&D initiatives will center on value-added models.
Cost reduction measures are also being introduced. With such efforts in place, makers are hopeful of moderate revenue gains in the next 12 months.
- Export prices will be augmented by as much as 10 percent due to rising production outlay. Adjustments in the yuan-US dollar exchange rate are also considered.
- Suppliers are developing upscale designs to justify higher quotes. They are using better inputs and improved structures. Some are taking advantage of the strong currency to purchase imported raw materials. A greater number of makers of glass tableware are utilizing tempered and borosilicate types for increased strength. Superwhite magnesian porcelain and durable cow-bone china are likewise employed more frequently.
- To enhance efficiency and reduce the number of employees, several teams are merged into one department to have fewer managers in the organization. Manufacturers are also acquiring automatic equipment, which has the added benefit of boosting product quality. Upgraded kilns, particularly, yield high-gloss ceramic and porcelain models without discoloration.
- The majority of featured suppliers are raising capital expenditure by more than 50 percent to support capability advancement efforts.
- Although the majority of businesses will still be targeting the US and the EU, many will be exploring alternative shipping destinations. These include Latin America, Africa, the Middle East and Southeast Asia. Several will cater to the domestic market.
- For differentiation in the OEM oriented industry, a number of companies will be focusing on OBM sales.
More information can be found in the report “Sourcing Report: Kitchen & Tableware” by Global Sources.
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