7 March 2019
Surprisingly Light Attendance at Shanghai Illumination Showcase
Although the mainland lighting industry is seen as being in robust health, with its turnover expected to top US$24 billion by 2024, buyers were said to be relatively thin on the ground at the recently-held Shanghai International Lighting Fair.
The fifth edition of the Shanghai International Lighting Fair (SILF) was focused mainly on urban and industrial lighting. At the previous iteration of the event, there were more than 12,000 visitors and 238 exhibitors. This time around, though, there was something of a dip – a surprising state of affairs given the robust nature of the mainland lighting sector.
Essentially, China is not only one of the leading producers of lighting products, but also a primary consumer. In recent years, government policy has given a considerable push towards the use of more energy-efficient light bulbs. In line with this, in 2012, it banned the import and sale of all incandescent bulbs above 100W. In 2016, the scope of this ban was extended to cover any incandescent bulbs above 15W, effectively phasing them out altogether.
The current focus is very much on the widespread adoption of light emitting diodes (LEDs), a lighting option that outperforms both traditional incandescent bulbs and compact florescent bulbs (CFLs) when it comes to lower energy consumption and longevity. The use of LEDs, however, incurs higher initial costs, something both the National Development and Reform Commission (NDRC) and the Ministry of Finance (MOF) have been looking to take the sting out of via a range of compensatory packages. As a consequence, China's LED lighting market is exhibiting strong growth and is now expected to be worth about US$24 billion by 2024.
Despite this, a substantial number of exhibitors were less than impressed with the footfall at the 2018 event. Voicing the concerns of many, Iyed Slama, Sales Director of Dongguan-based Sense Tech Light, said: "Each year there are fewer and fewer people coming to this show. Next year, maybe we won't attend either."
The company specialises in LED lighting for outdoor and industrial use and has been attending the show since it launched five years ago. At this particular iteration, though, Slama was concerned that not only were there fewer attendees overall, but that the number of overseas buyers, in particular, had dropped noticeably.
Expanding upon the reasons for his dissatisfaction, he said: "Basically, this show no longer seems to attract the support of the major brands. From our point of view, it's far less useful to us than the equivalent events in Hong Kong or Guangzhou.
"We are also increasingly concerned about the US-China trade war. Along with the EU and the Middle East, the US is one of our key markets and we're already having to contend with fluctuations to the dollar exchange rate, quite apart from the additional import levies."
Similar concerns were shared by Guanke Technologies, a Shenzhen-based business that has been producing outdoor, urban LED systems for about eight years. Selling under its own proprietary brand, while also offering an OEM service, the US is, again, its biggest market.
Outlining the company's current predicament, Sales Manager Evan Diao said: "Our prices are too high for the Chinese market. This is largely because in order to meet the requirements of our US customers, we have to use high-quality components, which put our costs up to a point where we can't compete for local sales against lower-cost, lower-quality items."
Another exhibitor that focused almost exclusively on the export market was YND, a Zhongshan-based business with a speciality in producing liner lights for the supermarket sector. Detailing the company's USP, Sales Manager Summer Liu said: "Basically, our selling point is that our products can be used across a range of up to 200 metres without the need for additional wiring, while we also offer a five-year warranty.
"For our part, we've been coming to this show since 2016, but it's not so good this year. We are mainly exporters and there are very few overseas buyers here. In the past, we've done well out of one particular German event, but it's now difficult to secure a stand."
Aixuan, another export-oriented Zhongshan business, was similarly unimpressed with the level of attendance. Spelling out the reasons for her particular concerns, Sales Manager Katrina Yu said: "We export about 95% of our production – mainly to Europe and to South America – and there's very few non-mainland buyers in attendance this time around. For our purposes, we've found that both the Guangzhou and Hong Kong shows are more suitable for us.
"We specialise in solar-powered street lighting, as well as heavy lights and floodlights. Our solar-powered lights can run for up to six hours and are ideal for use in towns, as their motion-detection capabilities automatically dim the illumination levels when there's no traffic present."
Although again from Zhongshan, Eika distinguished itself from its two predecessors by specialising in household lighting (one of the comparatively few at the event that did) and by being generally satisfied with the attendance demographic. Detailing its own reception, Sales Manager Shen Yangin said: "We've been established 15 years now and solely target the domestic market with our range of residential LED light bulbs. Maybe because, this year, we have a lot of new designs on offer, we have had a considerable level of interest from a variety of buyers."
Similarly happy – and for similar reasons – was SunyeTech. Again operating out of Zhongshan, the three-year-old business specialises in the manufacture of smart LED bulbs. Controllable either via a smartphone app or by voice command, the colour and intensity of its bulbs can be altered as required.
Clearly satisfied with the response from the buyers at the show, Sales Director Levi Li said: "We mainly export our products, either under our own branding or on an OEM basis. As it's a relatively new range, we have received a lot of interest and really have no complaints in that regard."
Apart from businesses selling bulbs and lighting systems, there was a comparatively small number of exhibitors selling either components or offering testing / quality-control services to both manufacturers and buyers. In the latter category was Ningbo-based Standard Tech Testing Services, while looking to take a lead in the former was Dongguan Chuanghui Electronics.
Established in 2004, Chuanghui produces the aluminium electrolyte capacitors used as the drivers of LED lights. The company's primary market is other mainland manufacturers, although many of these, in turn, often export their components to other countries where the finished lighting systems are actually assembled.
Explaining its approach to securing business, Sales Manager Carol Zhang said: "Our capacitors are actually very price-competitive. Although other types of capacitors, such as the many ceramic ranges, tend to be smaller, by using aluminium we can produce to exactly the same spec, but remain considerably cheaper."
It was the expanding interest in the export markets, rather than price concerns, however, that was keeping Standard Tech in business. At present, the company offers testing and certification services that ensure compliance with a variety of different international standards, though its primary focus is on North American regulatory requirements.
Providing an insight into its overall strategy, Vice-General Manager Johnson Sun said: "Our selling point is that by testing in China, manufacturers can reduce their testing and certification lead times, allowing for quicker launches onto the international market. We're finding that our customer base is continuing to expand, with more and more mainland manufacturers now keen to crack the export markets."
The 2018 Shanghai International Lighting Fair took place from 3-5 September at the Shanghai New International Expo Centre.
Chen Rong, Special Correspondent, Shanghai