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Mainland Outdoor Sporting Goods Sector Posts 31% Growth for 2013

With massive growth in the sector, according to new government figures, The 15th Guangdong International Sporting Goods Fair and 11th Guangdong/Hong Kong/Macau International Sporting Goods Fair, proved a dynamic showcase.

Photo: Multi-terrain transport: For those with amphibious ambitions.
Multi-terrain transport: For those with amphibious ambitions.
Photo: Multi-terrain transport: For those with amphibious ambitions.
Multi-terrain transport: For those with amphibious ambitions.

The 15th Guangdong International Sporting Goods Fair and 11th Guangdong/Hong Kong/Macau International Sporting Goods Fair saw a vast array of leisure products on display, with notable highlights including amphibious all-terrain vehicles, wearable sports video cameras and cooling sports towels. According to the event's organisers, this was the largest sporting goods expo in southern China, with its exhibition floor space of 30,000 sqm attracting buyers and exhibitors from all over the world.

The increased size of the expo was very much in line with the overall growth of the sector. In 2013, the mainland outdoor products market recorded sales of Rmb9.68 billion, up 30.99% on the previous year, according to statistics in the central government's 2013 Development White Paper on the China Sporting Goods Industry. Excess production capacity in the mainland's traditional sporting goods sector, however, has meant that manufacturers have shifted their focus to the outdoor market. The result is increasing segmentation, with individual manufacturers specialising in sectors such as mountaineering, hiking, camping, rock climbing, cycling, cross-country running, skiing, fishing or driving. At the same time, manufacturers are also increasing their investment into product innovation and added services as they try to expand their brand footprint.

Lifestyle changes

According to many exhibitors at the event, with living standards continuing to rise across China, this has had a direct knock-on to lifestyle choices. This has seen more people opting to participate in outdoor recreational activities, while also encouraging others to do so. Inevitably, this has boosted the market, with spending on purchasing outdoor products showing a distinct year-on-year increase.

Photo: Bike buying: A boom sector.
Bike buying: A boom sector.
Photo: Bike buying: A boom sector.
Bike buying: A boom sector.
Photo: Pedalling bikes at the Guangdong Expo.
Pedalling bikes at the Guangdong Expo.
Photo: Pedalling bikes at the Guangdong Expo.
Pedalling bikes at the Guangdong Expo.

One beneficiary of this new emphasis on outdoor health has been Dongguan's Tiwata Electronics Co Ltd, manufacturer of outdoor lighting equipment, including multi-functional LED camping lights. Its camping and emergency light product series has obtained various patents and incorporates a number of innovative features, including strong and weak light settings, a strobe mode, SOS signalling and a charging port. Its attractive design has helped it gain considerable traction in the market, with it now being sold throughout Southeast Asia, the Americas and Europe.

Tiwata has also achieved positive sales on the mainland, with Deng Jinabo, the company's General Manager, optimistic that further gains are afoot. According to Deng, the number of middle-income earners in Chinese cities was around 230 million in 2009, accounting for approximately 37% of the urban population. This demographic, he said, was likely to spend much of its leisure time engaged in outdoor activities and travel, resulting in a surge for outdoor equipment. Looking at it from his own company's perspective, Deng said: "Lights are a must for outdoor activities."

Another company citing lifestyle changes as the spur to its growth was the Shenzhen Meihang Magnesium Alloy Technology Co Ltd. Zeng Xiangyun, the company's Business Manager, said: "As living standards rise, people like to get back to nature." With this philosophy in mind, back in 2011 the company switched from making wheel hubs for electric vehicles to producing bicycle wheel sets.

Explaining the move, Zeng said: "The company did a lot of research before making the change. We realised that, at the time, the outdoor wheel set market was growing at a rate of 20% per annum." Since that time, he said, the company's own titanium-magnesium alloy cycle wheel sets have enjoyed a similar growth.

It is the sheer scope of the sector that has attracted a number of other players. Zhang Jiahua, President of Shenzhen's Good Family Enterprise Co Ltd, said: "The 'outdoors' concept is a broad one, covering a wide range of products and presenting boundless business opportunities."

Photo: On trend: Titanium-magnesium wheels.
On trend: Titanium-magnesium wheels.
Photo: On trend: Titanium-magnesium wheels.
On trend: Titanium-magnesium wheels.
Photo: Checking out outdoor chess.
Checking out outdoor chess.
Photo: Checking out outdoor chess.
Checking out outdoor chess.

Over recent years, Good Family has found considerable success with its outdoor chessboard, said to be suitable for Chinese chess, military chess and Gomoku (aka Gobang or Five in a Row). Made of reinforced glass, it retains its form and colour despite adverse weather conditions. To facilitate this, the chess pieces are attached to the board by steel wires, with rain allowed to drain away through tracks on the board.

The product has now been installed in parks and fitness trails in many mainland cities and provinces. According to Zhang, the board has also been purchased for use in schools, public squares and residential communities. He said: "Beijing's Haidian district, for instance, has purchased more than 1,000 sets. Currently, the sales of our outdoor products are maintaining double-digit growth every year."

Another company quick to adapt its product base to changes in market demand was Shenzhen U2 Communication Equipment Co Ltd. The company has been in the walkie-talkie business for more than 10 years, but only launched its first outdoors bicycle helmet walkie-talkie set in April. Yang Shanxiang, the company's General Manager, said there has been a cultural shift, with cycling now widely embraced as a social and leisure activity. The company's new walkie-talkies are said to be safe, attachable to bike helmets and easily controlled via a touchpad. The product comes with ear buds and is, apparently, only one-third of the weight of a traditional walkie-talkie. According to Yang, even though the product has a distinct competitive edge, he still needs to attend exhibitions and fairs to maintain its prominence in the outdoor market.

Quality and novelty

According to both exhibitors and buyers at the Fair, the quality level of outdoor equipment has noticeably risen in line with growing safety awareness. This has obliged suppliers to ensure the quality of their goods in order to establish the goodwill necessary to expand their market share.

One company that has taken this on board is the Shenzhen Xinyouda Plastic Electronics Co Ltd, a specialist in outdoor audio-visual equipment. Its colourful water bottle/MP3 player has a bright light that can serve as a safety alarm for outdoor activities conducted at night. Luo Tao, the company's Operations Director, said as segmentation of the mainland outdoor products market is now the norm, his company is focussing on developing particularly-innovative products.

Photo: Tee time at the Fair.
Tee time at the Fair.
Photo: Tee time at the Fair.
Tee time at the Fair.
Photo: Heading for safer cycling.
Heading for safer cycling.
Photo: Heading for safer cycling.
Heading for safer cycling.

The Shunde Moon Helmet Co Ltd has adopted a similar approach. The official helmet supplier for the 2013 Tour of Qinghai Lake International Road Cycling Race, Moon Helmet focussed on OEM manufacturing for the first 10 years following its launch. More recently, in a bid to ensure its long-term development, the company established its own brand range of helmets. It now produces a series of original designs, including celadon green China, volcanic lava, Iron Man and Transformers products. Zhu Zongming, Moon Helmet's Sales Manager, believes the increased market segmentation is a sign that the industry is maturing, obliging the company to properly define its market positioning. As a result, over the past two years, its sales have grown more than 200% per annum.

According to Zhu, however, there is still no unified standard in China for outdoor products. As such the company adapts standards from other industries as reference points. He believes that any future industry standards should be segmented in line with the various product classifications and grades, ensuring consumers have adequate reference points when they buy outdoor products.

Functional and fashionable

It was evident at the Fair that high-end outdoors equipment had an appeal well beyond professionals, with many of the general public keen to make purchases. A number of exhibitors highlighted their products' personalised and fashionable concepts, innovations designed to widen their consumer appeal. One such exhibitor was Qile, a Zhongshan-based sporting goods company, specialising in custom-made outdoor clothing for cycling, rollerblading, ball games and beach activities.

Cai Xiaolin, the company's Business Manager, said it had now signed significant orders with buyers from the Middle East, the United Kingdom, France and South Africa. At present, it lists sports clubs, manufacturers and distributors among its customers. Despite the diversity of its customer base, Cai believes they all have one thing in common, saying: "Everyone wants to stand out from the crowd and have something unique."

Acknowledging this shift, Meihang's Zeng said: "People's consumption patterns have changed. In the past, when someone bought a bicycle, he looked for sturdiness and durability. Now they go for something fashionable, high performance and compact."

According to Zeng, the price of titanium-magnesium alloy wheel sets is 50% higher than those composed of aluminium alloy, but the weight is one-third less. For DIY customers, who assemble their own bikes, one or two grammes can make a big difference. For this reason, titanium-magnesium alloy is now widely used to make pedals, wheel sets, fork structures and bicycle frames.

Photo: High-visibility cycling gear.
High-visibility cycling gear.
Photo: High-visibility cycling gear.
High-visibility cycling gear.
Photo: Wearable Wi-Fi cameras
Wearable Wi-Fi cameras
Photo: Wearable Wi-Fi cameras
Wearable Wi-Fi cameras

Taking a slightly more high-tech approach was Guangzhou China-Shine Electronic S&T Co Ltd, manufacturer of wearable sports video cameras. It was at the Fair to showcase its latest range of Wi-Fi product. Resembling stylish sunglasses, the cameras come with replaceable colour lenses. On the upper right corner of the spectacle frame is a 1080P high-definition camera, capable of capturing still images and video. This is connected to the user's mobile phone via Wi-Fi. The camera's 140 degree wide-angle lens is said to have the same visual field as the human eye.

Zheng Mo, the company's Development Department Assistant Manager, said many overseas outdoor sports fans like to record images while they are skiing, rock climbing or biking, with this preferences now becoming popular on the mainland.

The 15th Guangdong International Sporting Goods Fair and 11th Guangdong/Hong Kong/Macau International Sporting Goods Fair was held at the China Import and Export Fair Pazhou Complex in Guangzhou from 15-17 August, 2014.

Xing Fang, Special Correspondent, Guangzhou

Content provided by Picture: HKTDC Research
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