Auxiliary equipment maker Conair Group Inc. plans to open a plant in China in late 2006.
Leo Su, general manager of Conair East Asia, said in an interview at Taipei Plas 2006 that the project is in the planning stages.
Pittsburgh-based Conair already has a Chinese facility offering sales and after-sales service. ``Conair has now worked up to No. 1 or 2 in the [Chinese] market,'' Su said.
Conair has a long history in Asia. The company began exporting products to Taiwan more than 20 years ago and established an office in Taipei in 1998. In addition to Taipei and Shanghai offices, Conair has subsidiaries in Singapore and the Philippines. The company also has sales and service locations in Malaysia, Indonesia and India.
Christopher Keller, Conair's president and chief operating officer, outlined the international moves during a Feb. 24 interview at company headquarters in Pittsburgh. ``Global is a huge piece of our strategy,'' he said.
``We're saying, if you've been a Conair customer for 10 years, and you're going to do something in China, or in Europe, or in South America or in Mexico - wherever - we want to be there for you.
``But, for those customers to have the same faith in Conair outside the U.S. as they do inside the U.S., we've got to be there with them. So having a local presence is absolutely critical,'' Keller said.
Sales, sales, sales
At Taipei Plas, held March 24-27, Su said the Taiwan market now is very stable for the company. Conair supplies machinery to domestic companies in the chemicals, automobile parts, fibers and consumer electronics industries in Taiwan. One of Conair's largest Taiwanese customers is injection molder Green Point Enterprises Co. Ltd. Conair supplies 90 percent of Green Point's plants, with dryers, conveyer systems and blenders.
In China, Conair supplies multinational and domestic enterprises. One customer, Master Kung Holdings Co. Ltd., Greater China's largest maker of instant noodles and bottled tea, uses Conair central conveyer systems in its 12 PET bottling factories.
``Multinationals are more familiar with Conair's products,'' said Taiwan sales manager Jack Chen. ``But many [original equipment manufacturers] for multinationals use Conair products as well.''
Multinationals often select machinery and materials suppliers on behalf of their China-based OEMs. Motorola, for example, has a bevy of suppliers, and many of them use Conair auxiliary machines, according to Su and Chen.
Other customers in China include Shenzhen-based BYD Co. Ltd. and Singapore injection molder Hi-P International Ltd.
BYD, a cell phone battery manufacturer with plans to become one of China's largest technology-oriented manufacturers, uses Conair dryers in its Shenzhen optical electronics factory. BYD also has entered the automotive parts industry, which should provide more sales for Conair. Hi-P does OEM manufacturing for Motorola, Siemens, Nokia and Braun.
In addition to selling Conair machines, the Shanghai office acts as distributor and agent for Sweden's Rapid Granulator AB.
Final plans for the Chinese facility remain under discussion among Conair top management. However, the company likes Songjiang or Jiading, two Shanghai suburbs, as possible plant locations, according to Keller and Su. Songjiang has a good environment for electronics makers, and Jiading boasts lots of automotive component suppliers, Su said.
A final decision on the location is expected soon, company officials said.
After applying for licenses and getting a factory running, Su said the company plans to produce dryers first, and expand the production line to a full range over three years. Conair declined to reveal the total investment, but Su said the company expects the plant to reap $20 million to $30 million in sales within a few years of opening.
North America remains Conair's biggest market. Some auxiliary equipment suppliers have imported equipment - notably grinders - from China. Keller said Conair does not plan to follow that strategy and will continue to assemble its equipment for the North American market in Franklin, Pa.
Conair custom-configures its auxiliary equipment to meet specific customer requirements. Keller said delivery times and quality are important.
``Our strategy will not be to import low-cost finished product from overseas,'' he said in the Pittsburgh interview. ``We don't feel we can meet the delivery time on a made-to-order product that the customers expect. It can't sit on a boat for four to six weeks.''
In China, Keller said, Conair faces the same issue: Not having a local assembly plant is limiting the company's growth.