3 May 2006
Patently Profitable(HKTDC Enterprise, Vol 05,2006)
Golden Peak Plastic Works Ltd
The path to success is often hard to find and sometimes even harder to quantify, yet Golden Peak Plastic Works Ltd happily discovered its road to riches in the form of patented design ideas and products.
"We started our business in 1975, with the main focus on seasonal gifts," recalls export sales manager John Leung. "We had a line of water bowls featuring various figurines and several knick-knacks for household display shelves and sideboards."
Leung says that while these items provided good sales right up to the mid-1980s, competition from ever-increasing numbers of suppliers gradually eroded profit margins. "We tried new approaches, such as manufacturing gift items associated with popular books," he says. "We had a figurine of the main character packaged with the book, in cooperation with the publishers. But that proved just a stop-gap measure, and we felt driven to find new markets and new products."
By 1997, with the local market in a state of uncertainty, sales in the home decoration sector were falling drastically. "This was the catalyst for change, and we knew that we had to do something different that also incorporated our work ethic and commitment to good quality," says Leung. "We had always had a bit of the pioneering spirit and, following some heavy brainstorming sessions and a lot of R&D, we decided to offer patented products that we believed would be universally popular."
That was about five years ago, and in the interim the firm has prospered with a most unlikely hero: the ubiquitous suction cup found in bathrooms and kitchens worldwide.
"We took a long, hard look at the existing, common suction cup designed to adhere to walls. The weaknesses were easy to spot, so we formulated a design that really worked and a suction cup that would stick anywhere, hold fast yet be released in a jiffy," Leung says.
"We decided to make a high-quality product using top grade plastics, and even added a small feature that proved a boon for the marketing people. This is our exclusive and patented Redicator system, which is a red warning line that indicates if a cup is losing its suction power. In effect, we created the Super Hook home accessory."
Leung claims that today the firm's suction hooks are found around the world. "They come in various sizes and categories from light to heavy duty and even extra heavy duty," he says. "They are great as DIY items, and they are perfect for bathrooms, kitchens and general household use. They also come in sets, and we even have a series that fits into corners as the suction cups can swivel."
While the sales results have been excellent, responses from buyers visiting the company's booths at the Hong Kong Houseware Fair in April 2005, the Asian Expo in Las Vegas in August 2005 and at the Tokyo International Gifts Fair in September 2005 have been overwhelming.
"The purchasing agreements signed at those important events indicated that buyers realised that patented products could command better prices and enjoy a longer product cycle without unfair competition from illegal infringements. Everyone benefits," exclaims Leung.
"As a result, we have decided to gradually phase out our seasonal gifts lines, in favour of more patented household products, and give more resources to the R&D team to come up with more new products. In addition, new marketing strategies will include attending more overseas exhibitions, as well as print advertising and TV commercials."
The firm's patents are taken out in Hong Kong, on the Chinese mainland and in the countries where products are sold, mostly the US and Japan. "We also have OEM orders from Walt Disney, Warner Brothers, Sanrio, SEGA, Saban's, Gibson's and more," says Leung.
Production takes place at the firm's 10,000-square-metre plant in Shenzhen on the Chinese mainland that employs 500 workers.
To ensure consistent quality, Golden Peak uses high-grade PS and ABS sourced from Japan, Taiwan and Singapore. "We will always maintain our reputation as a provider of quality household products that meet materials safety data sheets (MSDS) specifications to confirm the content of our products is not harmful in any way," says Leung. The plant was ISO 9002-certified in October 1998.
Leung says that Golden Peak will continue to service existing clients and buyers of its range of souvenir items, but will not develop new products in that sector. "The best way to avoid cut-throat competition among fellow manufacturers is to be adventurous enough to invent new products or renovate old ones with fresh approaches," says Leung.
This approach by Golden Peak clearly pays dividends, wins friends and firms up a successful future for yet another innovating Hong Kong manufacturer.
WRITTEN BY TONY HENDERSON
Golden Peak Plastic Works Ltd