20 March 2006
Time Tested(HKTDC Watch & Clock, Vol 01,2008)
|Trade Mix Co Ltd specialises in sporty watches, which make up 60%-70% of total output|
It often takes time to make good - just ask watch manufacturer Trade Mix Co Ltd, which has emerged a winner after weathering some rough patches since its establishment 27 years ago.
"We focused initially on LCD watches with alloy cases," recalls Chairman Stephen Cheung. "But it wasn't long before the plethora of competitors in that niche took its toll on our profit margins."
With a surfeit of product choices and fast-changing watch trends, even customers who had placed orders would readily abort deals while relinquishing the deposits paid, he relates.
"As a result, we had a lot of stock on hand and we simply couldn't go on like that," Mr Cheung says. "I had to stop and think what was going wrong, and how I could put things right."
So Trade Mix changed direction in the mid-1990s in the light of research findings that only 10% of local watchmakers were producing stainless steel watches - which were then rather expensive new items.
"After much thought, I decided to switch to stainless steel quartz and automatic models, which we now mass-produce, to concentrate on the sporty watch market and recruit talented designers," Mr Cheung recounts.
The firm also took the bold step of sub-contracting production to a watchmaking factory in Shenzhen on the Chinese mainland instead of operating its own manufacturing facility. "This was another turning point because it allowed us to cut production costs to very low levels," the Chairman explains.
"At that time, when the ex-factory price of stainless steel watches produced by rival companies with own factories was about US$8, we shocked the industry by selling at only US$3.99."
However, this pricing backfired initially because buyers suspected the company had compromised quality. "But within a couple of years they were knocking on our door with their order books," Mr Cheung smiles, citing one memorable order from the UK for 400,000 stainless steel watches.
Trade Mix has since embarked on the path to success, and today it's going strong - and big. "The latest trend is for bigger sporty watches - so big that they make a real fashion statement," observes Mr Cheung. "In response, we've created an attractive sporty range that's possibly just a few centimetres short of being oversized."
Most items in this stainless steel collection feature link bracelets, he advises. "And their big, bold look projects a sort of in-your-face machismo."
Sporty varieties account for 60%-70% of about 100,000 watches produced monthly by the company, which is optimistic about its business outlook.
"I am positive the global market for watches will never reach saturation point," Mr Cheung reckons, maintaining that fashions change so significantly every 2-3 years that most consumers, especially young people, get tired of wearing the same watch any longer than that.
"Once they see their friends wearing eye-catching new watches and realise theirs has become out of date, they go shopping for an even newer and more daring model than the type their friends are wearing."
Mr Cheung notes that such style-consciousness pervades all Trade Mix's major markets, namely Europe, North and South America, and Asia.
"To keep pace with this demand, every year our R&D teams in Hong Kong and the mainland come up with at least 120 different new designs for sporty-style watches," he reveals.
Trade Mix cherry-picks the best of these and makes samples so the firm always has a range of exciting new designs to show to overseas customers. "Some of them have been with us from the beginning, so they're more like old friends - and they always look forward to seeing our latest innovations."
Mr Cheung sees Eastern Europe as the market with the highest growth potential. "This is followed by the US with its high consumption and purchasing power," Mr Cheung concludes.
Priding itself on "good quality, good products and good prices", time-tested Trade Mix certainly looks destined for even better times.
TEXT BY GEOFF SOMERS
|Trade Mix Co Ltd
5/F, Blk J, Phase 4
Kwun Tong Ind Centre,
435-446 Kwun Tong Rd
Major Product Categories: stainless steel watches with quartz, chronograph, automatic, digital, ana-digit & retrograde movements
Brands & Certificates: Go Go Sport
Minimum Order: 300 pieces
Monthly Production Capacity: -
Delivery Time: 65-75 days
Factory Size & Location: 1,500 square metres; Shenzhen