13 June 2019
Robo-Vacs Clean Up at Shanghai Home Appliances and Electronics Show
Robot vacuum cleaners proved to be the hero product at this year's Appliance and Electronics World Expo, with the wider application of automation and the increased integration of Artificial Intelligence said to have rejuvenated the sector.
The consensus among exhibitors at this year's Appliance and Electronics World Expo (AWE) was that artificial intelligence, robotics and the rapid growth of online sales have pretty much breathed new life into the sector. It's a sentiment official statistics seems to bear out.
China's home-appliance sector reported year-on-year growth of 17.5% in 2018 to RMB576.5 billion (US$86 billion) in value terms. With regard to the best-performing sub-categories, small gadgets enjoyed particularly explosive growth, with sales of such products as hand-held and robot vacuum cleaners surging by 50%, while demand for electric toothbrushes soared by more than 80%.
Confidence is high, judging by the lavish expo displays put on by the major domestic players, including Qingdao-headquartered Haier and Guangdong's Midea as well as a number of international companies – most notably Sony and Panasonic, two of Japan's most high-profile electronics brands. The event, which this year took AI and Smart Life as its headline theme, extended across 10 halls and attracted a truly global array of exhibitors.
While many of them had made their way to Shanghai to showcase innovative takes on traditional appliances, such as televisions or washing machines, others were looking to promote wholly new products and concepts, all of them said to make home life more convenient and more comfortable. In addition to the obligatory array of high-profile B2C companies that dominate the sector, there were also many smaller firms, with the component manufacturers that keep the industry's supply chain from grinding to a halt particularly well-represented.
One such exhibiting supplier was Wisechip Semiconductor, a 14-year-old Taiwanese manufacturer of OLED-type screens and accompanying driver chips. Outlining his hopes of finding an expanded range of applications for his products, company Vice-president Bert Hsia said: "We are here to get new customers for our transparent and curved displays. We're finding that new uses for them are now emerging from certain cutting-edge innovations, such as the heads-up displays now incorporated into many cars.
"We're old hands at this show and this is our third year here. This time around, as well as meeting up with many of our existing customers, we've also been in talks with several potential new ones."
Another component exhibitor had travelled a little further to attend the event, with Embraco having undertaken a 38,000-km roundtrip from southern Brazil to participate. Founded in 1971, the company is said to be a world leader in refrigeration compressor technology, with its newly launched VESG9C the focal point of its stand this year.
Despite not selling directly to consumers, the company had made its way to Shanghai, partly at least, to build public awareness of its brand. Explaining the thinking behind this strategy, a Sales Representative on the company's stand said: "As this show is more focused on the end-user market than on manufacturers, one of the reasons we are here is to nurture a 'pull' effect from consumers by making them aware of how the use of Embraco technology could enhance any domestically produced fridge they might buy."
In contrast to the subtle approach favoured by Embraco, many exhibitors were targeting consumers more directly, with a substantial number also seeking to communicate exactly the same proposition – "Our products will make your life a little easier and a lot more convenient." A prime example of this approach came courtesy of Guangzhou's Fitcooker.
Founded nine years ago, the company started work on developing a new dual-pot rice cooker in 2015 and was now finally ready to bring it to market. Artfully testifying to its desirability, Sales Manager Maya Chang said: "I have two of these at home and I use them to prepare the lunch my children take to school every day. I simply put them on and then go out for a run. When I return, 30 minutes later, the food is ready."
Historically, the company has focused on exporting its rice cookers on an OEM basis, restricting itself to just one customer in each individual national market and ensuring its technology was patented in every country possible. In 2017, it changed direction somewhat and began selling directly into the mainland market under its proprietary Fitcooker brand.
One of its most successful lines has been the Fitcooker dual pot range. Available in a variety of sizes, the top-of-the-range model features two 2.5-litre bowls and has a power output of 1,300W. Its multiple programming facility is said to provide a wide choice of cooking options, including slow cooking, braising and steaming.
While the dual-pot cooker had clearly found a ready market, in popularity terms it probably couldn't compete with a robot vacuum cleaner, with these autonomous household aids – on offer from a sizable contingent of smaller manufacturers – arguably the event's breakout product.
One company looking to take a lead in this product category was Shenzhen-based Minsu, a seven-year-old business that manufactures on an OEM basis as well as selling under its own brand. This time around its hero product was a drop-resistant robovac capable of working on raised surfaces and surviving the occasional fall.
Outlining the company's current sales strategy, Marketing Manager Maggie Ma said: "This market for robovacs is expanding very quickly, particularly in Europe, which is our core market. Now, though, we are also keen to boost our share of the domestic market. In line with that, one of the reasons we are attending this event is to sign-up more mainland-based distributors and agents."
On a very similar arc in terms of looking to build its brand in the domestic market was Timzuu Electrical Appliances, a Dongguan-based steam-oven manufacturer of 30 years standing. Historically, it has operated primarily as an OEM / ODM supplier, but is now also going to market under its own Timzuu branding.
Outlining the company's ubiquity and the innovative nature of its products, a spokesman said: "Our ovens have a removable water tray and the heat can come not only from the bottom, but also from the top and back, which is a real help when you're cooking fish. If you look and ask around, you will see that most of steam ovens on offer from nearly all of the Chinese brands were actually made by us.
"We come to this show every year as many of our long-standing customers also attend and are keen to check out our new products. We find it hugely reassuring when they buy into our new models and admire our latest designs."
In the case of China Best, a Guangdong-based manufacturer of cookers, dishwashers and water heaters, the quality of its products has been endorsed by a far loftier source than just its own client base – in the run-up to the 2008 Beijing Olympic Games, the Chinese government awarded it the official contract to produce the event's highly symbolic torches.
When not working on such high-profile state projects, the company primarily manufactures on an OEM / ODM basis for several overseas clients. It also sells on its own behalf under two proprietary brands – China Best and the slightly more upmarket Vatti.
Addressing both the company's reasons for attending the event and the currently adverse trading conditions, Sales Manager Jennifer Zhang said: "We now sell in 126 countries and have 340 partners. One of our strongest lines is our range of gas products. At this event, we are focusing more on promoting an overall lifestyle concept to consumers, while, at many of the overseas shows, we tend to be more direct and just zero in on getting orders.
"Overall, sales this year have not been so good, largely on account of the repercussions of the US-China trade war. Currently, about 55% of our output goes for export, so we're a little vulnerable in that regard."
The 2019 Appliance and Electronics World Expo took place from 14-17 March at the Shanghai New International Expo Centre.
Chen Rong, Special Correspondent, Shanghai