A simple plastic watch strap may not at first glance seem to have much in common with a complicated tool, precision engineered from nylon 6/6, polyurethane and polycarbonate, that's used by doctors to remove the gallbladder during surgery.
But for one Hong Kong injection molding firm, Yu Hing Mfg. Co., molding those watch straps quite naturally, if not directly, led to the operating table. How it did offers a look at how a small Chinese firm hopes it can use new markets and a focus on adapting technology to survive the implosion of manufacturing in China's Pearl River Delta manufacturing corridor.
Yu Hing began as a watch-strap maker in 1976, but a company focus on adapting technology — and a project helping a charity deliver cataract surgery to poor communities in China — helped launch its medical division, MediConcepts Ltd.
Benjamin Chan, MediConcepts director, said in an interview at his Hong Kong offices that his father, company founder C.C. Chan, was an engineer who liked to tinker. Yu Hing was an early adapter of standardized tools in the 1980s, and was one of the first to use electroforming technology to make molds for PVC straps for Timex and other international firms when watch makers sought a cheaper alternative to leather straps.
The initial molding operation grew into embedding antennas into the straps to make combination pager-watches, a 1980s trend. From there, Yu Hing made forays into heart-monitoring watches and other health care products.
But it was a 1990s project helping an Australian charity, the Fred Hollows Foundation, provide cataract surgery in mainland China that helped galvanize the firm's interest in medical work, Benjamin Chan said. Yu Hing introduced the foundation to Chinese officials and helped it set up operations in several Chinese provinces, while the company made simple plastic lens cases and other peripherals for the charity.
More importantly, Chan said, Yu Hing began exploring how to use its electroforming technology in making the lenses. That research was never commercialized, but it was crucial in helping the firm see that it could branch into medical markets, said Chan, who is also vice chairman at the Hong Kong Medical and Health Care Device Manufacturers Association.
Yu Hing's work with charity groups and funding of medical research at universities in Hong Kong helps it stay in touch with the medical community and keep in front of doctors who might be looking to develop their own products, Chan said.
``Because we do business with charity groups, we know a lot of surgeons in the market who have innovative designs,'' Chan said. ``They come and look for us and ask if we want to develop with them.
Chan said Yu Hing doesn't wait for medical device makers to give them medical business. ``We work with the surgeons. We work with the inventors,'' he said.
The company has helped develop a surgical tool for removing gallbladders and other organs, and is sponsoring a clinical trial using Nitinol shape memory metals to make a device used in spinal-implant surgery, said David Wong, Yu Hing's business development president.
Medical remains a small part of the company's business. It has seven molding machines for medical projects in a clean room at its Shenzhen plant among more than 70 injection presses, including 13 Arburg machines and one Sodick magnesium injection press. Yu Hing is looking for its medical device division to help push growth at the factory, which employs 500, even as other firms in southern China shed workers.
Chan said while its margins are getting tighter across its businesses, the company expects it may pick up work in the watch industry, as the economic downturn pushes competitors to close.
He said the company actually has kept tooling workers in its factory, delaying their plans to return home for the Chinese new year, because Yu Hing is seeing more work as other firms shut down.
Chan said he expects the company's medical staff to grow, from about 50 now to 100 or 150 in a year, and that the firm will add three presses. Much of the medical expansion will focus on adding quality-control staff, he said.
``If I double my [medical] workforce, I'll triple or quadruple my [quality-control] team,'' he said. ``That is your guard dog, you have to have that. You want manufacturing to be a low-risk, low-return business. You have to be more conservative in running a manufacturing business.''
Still, Yu Hing is getting more aggressive in medical markets. It's exhibiting at trade shows and getting involved with a government project in the United Kingdom to encourage doctors and nurses to develop their ideas into medical products, Wong said.
For Chan, it's part of a strategy to get through what he thinks will be a two-year economic down cycle, and then being positioned for the next pick up.
``We think this will be a two-year cycle,'' he said. ``We have enough bullets and the mental quotient to sit through it as a company and wait for another big time to come.''