Operating in the fast-growing Chinese tech sector
The production of high-tech products is slowly shifting towards China. Next week CES Shanghai is taking place, one of the largest consumer technology tradeshows in the eastern hemisphere. Many new high-tech solutions will be introduced to the public here.
The high-tech market is ever-changing and fast-growing, which makes it both challenging and rewarding. How do you cope and profit as a Dutch company? We spoke with Fabian Blake, General Manager at AMS, a Dutch company which has been active in the Chinese manufacturing industry since 2003.
Can you give a short introduction to AMS?
“We are a wholly Dutch owned company, with headquarters in Amsterdam and manufacturing facilities in Foshan, China. Our main focus is product manufacturing in clusters such as architectural hardware, building and retail safety, mobility solutions and so on. Besides this high-tech focus, we also fabricate molds and plastic parts for export.”
Why did you start branching out to China?
“Many founders or owners of companies want to produce in China but they are hesitant because of IPR risks. We decided to start in China so we could offer a manufacturing facility with IPR protection for Western clients in China. By looking at each and every product assembly project and spreading the information within our supply chain, we have been able to devise a special way to offer better protection. Every partner only gets the small piece of information they need to do their part."
“Besides this there are many other benefits. For instance, there is a large manufacturing capacity, extensive supply chain and we are located conveniently within the ‘Golden Triangle’ (Guangzhou-Hong Kong-Macao). The rise of labor and manufacturing costs in China is not impacting us too much, because of our focus on service: Our added value is the expertise we offer to clients rather than simply manufacturing products."
“Besides the interesting developments on the market, the nearby 'Chinese Silicone Valley’ Shenzhen is also a good opportunity for AMS to develop an additional and more local sales market. We discovered that our value proposition is interesting to both potential clients in the Western market and other prospects who are looking to access readily-available manufacturing capacity.”
What are the main challenges you are facing?
“We operate in a market niche within the vast and fast-growing Chinese tech-market. One of our challenges is to make the correct match between our value proposition and the numerous opportunities. Even if we are able to cover many different sectors, each project is unique in its own way. In addition to this, they are all at a different level of development and come with different expectations. This makes our business a very exciting challenge!”
“Another challenge is the speed at which our sector is modernizing and developing. In order to stay competitive we need to continuously evaluate. It is all about integrating the right resources and investing in our equipment, so we can live up to up the expectations of our clients.”
What is your advice for companies who want to enter the Chinese tech-market as well?
“I have two pieces of advice. First of all: Do not get lost and do not panic! Make sure you have a plan and stay in control, as situations can change quickly in China. Secondly: make sure to protect yourself. When you come to the market with an innovative idea, think about solid IPR protection. Hire lawyers, play by the rules and organize both your work and projects in a way that minimizes any risk of copyright disputes.”