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Veritable Vision(HKTDC Gifts, Premium & Stationery, Vol 04,2007)


GPS & Digital Video


Megaluck Enterprises Ltd is moving up the value chain, switching focus to GPS and Digital Video Broadcasting - Terrestrial (DVB-T) devices
The big picture is clear to photo and imaging product manufacturer Megaluck Enterprises Ltd - the market is moving up the value chain.

So the company is switching focus from single-use cameras to GPS and Digital Video Broadcasting - Terrestrial (DVB-T) devices.

"We have decided on a change of direction because we do not see very good prospects for our current staple - the single-use camera," says Managing Director Leonard Wong.

He points out diversification into conventional or digital cameras, a strategy common with peers, would provide no long-term solution given the increasing number of electronic gadgets equipped with photo-taking functions.

"Meanwhile, we notice that the gifts and premiums market is trending towards higher-end and higher-value products," he observes.

"Just look at the credit card market - many are offering mobile phones, digital cameras and other expensive electronic products as welcome gifts to attract customers."

Therefore, Mr Wong explains, 1995-established Megaluck is venturing into niche electronic products that are higher up the price spectrum.

Not surprisingly, its GPS Navigators and DVB-T devices met with an encouraging response when launched at the Hong Kong Gifts and Premium Fair as well as the Summer Sourcing Show for Gifts, Houseware and Toys this year.

"Some buyers had never thought of using them as gifts or premiums, so they were really interested - we received a lot of enquiries and some orders are under negotiation," enthuses Mr Wong.

He notes that the GPS Navigators are compact and easy to use, with a multimedia player, touch-screen operation, automatic route calculation and turn-by-turn, voice-prompted directions available in 19 languages. There is also a Secure Digital (SD) card slot for both map and movie SD cards.

"We use high-quality components, including the Samsung 400 MHz processor for the CPU and the SiRF III high-sensitivity receiver, which promises position accuracy of up to three metres," Mr Wong elaborates.

He reveals that the major challenge of venturing into the GPS market is to find buyers of considerable size as they will have to provide value-added services for consumers.

"For instance, buyers have to provide support services like running a website for map updating or they may need the bargaining power to negotiate prices with their local government for using Traffic Management Control services with our GPS Navigators," explains Mr Wong.

Operating an ISO 9001- and ISO 14001-certified, 5,000-square-metre, 1,000-worker factory in Shenzhen on the Chinese mainland for production of its photo and imaging products, Megaluck is adopting a new business model for the GPS and DVB-T lines.

"We are partnering with some IT companies for product design and development as well as outsourcing our production, while we focus on marketing and sourcing materials - the areas we excel in," notes Mr Wong.

He adds that the price competitiveness of electronics manufacturers often depends on their ability to secure raw materials in large quantities and therefore at low costs.

"Our strength is that we have connections with some big supply chain companies which buy electronic parts in bulk and resell to us at economic prices, enabling us to pass on the benefits to our buyers," says Mr Wong.

Megaluck's OEM production partner is also located in Shenzhen. "It is a very big and reliable plant which is manufacturing for many reputable brands, including Acer, TCL and Lenovo," adds Mr Wong. "It is also ISO 9001-certified and meets TUV standards."

Minimum order is usually 500 units, for delivery 30-45 days after order confirmation. Photo and imaging products currently account for about 70% of Megaluck's turnover, but the figure is expected to fall to 20%-35% in the coming year with the introduction of new product ranges.

Meanwhile, Megaluck is refreshing its GPS and DVB-T models with new features. For example, an upcoming GPS Navigator will be equipped with Bluetooth capability, allowing it to double as a hands-free mobile phone.

Another will come with an extra antenna jack, which enables it to function as a DVB-T device. "Some lower-end models with more affordable prices will also be designed for the premiums market," Mr Wong adds.

With such strategic vision, Megaluck looks certain to strike it lucky in its new ventures.


Megaluck Enterprises Ltd

3/F, 88 Lockhart Rd,
Wanchai, Hong Kong
Tel: 852-2575-0160
Fax: 852-3413-8777
Web: www.nr-tech.b2s.com