From small household appliances to big business
The people of Cixi often say, "Manufacturing a small household appliance takes less than an hour to find all the components and complete assembly in Cixi."
There are over 2000 home appliance manufacturers and nearly 10000 supporting enterprises in Cixi, Zhejiang, with products covering over 20 series and thousands of varieties. In terms of production, Cixi produces and manufactures about 60% of the world's small household appliances, with a market size of 100 billion yuan. The production of multiple sub varieties such as electric irons, hair dryers, and electric heaters ranks first in the world.
How was Cixi, the world-class "capital of small household appliances" refined? How can the people of Cixi turn inconspicuous small household appliances into big businesses with a value of billions of yuan? Let's come to Cixi to explore the truth.
Although the small household appliance industry in Cixi is so prosperous today, before the reform and opening up, the local area was still mainly focused on agricultural production, and the economic and trade development was far from that of neighboring counties and cities.
In the 1980s, the government introduced policies to encourage rural areas to actively adjust their industrial structure. With this opportunity, a large number of township enterprises have sprung up like mushrooms all over the country. During this period, some Cixi people who ventured abroad returned to their hometowns to start businesses, and also brought back advanced skills from factories and workshops in other places. "At that time, we gathered many skilled personnel in accessory processing here, who could run businesses and do work. They established many workshops and factories in towns such as Zhouxiang to undertake the production and processing of home appliance plastics and hardware spare parts for large enterprises in Northeast China, Qingdao, Shanghai, and other places." said Xiong Guoquan, Secretary of the Yuncheng Village Party Branch in Zhouxiang Town, Cixi City.
After entering the 1990s, the number of small home appliance enterprises and practitioners in Cixi increased significantly. "Driven by the older generation of entrepreneurs, many newcomers have joined the small home appliance industry. Everyone gathered together to discuss how to make money and manufacture products, and 'starting a factory and starting a business' has become a trend," said Xiong Guoquan.
With the continuous expansion of business, the traditional family small workshop model of "front store and back factory" can no longer meet production needs. In order to seek long-term development, many spare parts enterprises have begun to expand and transform their business. Larger and more complex home appliance and machine enterprises are blooming everywhere in Cixi, operating product categories covering various fields such as household appliances, kitchen utensils, beauty and hairdressing appliances, etc. During this period, world "singles champions" such as Yueli and Zhuoli in the current small home appliance sub industry established and emerged.
Small home appliance practitioners in Cixi actively expand their business outward, and various international exhibitions such as the Canton Fair are important occasions for them to meet foreign businesses. With excellent product quality, Cixi small household appliances have received a wide range of "foreign orders" at the exhibition, becoming a production and processing company for many international brands. As local enterprises continue to expand their overseas markets, Cixi has gradually grown into an important base for small home appliance procurement in the international market, and the world-class "Small Home Appliance Capital" has begun to take shape.
After more than 40 years of development, small household appliances have become a beautiful business card of Cixi and formed a sound industrial chain. Taking Yuncheng Village under the jurisdiction of Zhouxiang Town in Cixi City as an example, there are more than 200 enterprises engaged in the production and manufacturing of small household appliances in this village level administrative unit covering an area of 3.68 square kilometers, with an annual output value exceeding 2.5 billion yuan. The entire process of small home appliance manufacturing, from mold design and manufacturing to injection molding and spraying, from key component production to complete assembly and delivery, can be completed in Yuncheng Village in a one-stop manner.
"The location advantage of Cixi's small home appliance industry is obvious, which gives us local enterprises full competitiveness," said Li Lizhong, Director of the Marketing Center of Yueli Group Co., Ltd.
Whether the brand management is good or not depends on the data. Within one year of its launch, Xiaoshi's sales exceeded 100 million yuan, with year-on-year growth rates of 100% and 50% in 2021 and 2022, respectively.
The government of Cixi City is adopting various measures such as the "Brand Strong City" strategy to encourage local enterprises to create independent trademark brands, promote both domestic and international sales in the industry, and promote high-quality development in industries such as home appliances. Under the guidance of relevant policies, the transition from "OEM" to "OEM" has become a consensus for the development of small home appliance practitioners in Cixi.