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After Underselling Splurge, Quality Consciousness Emerges in China's Lighting Market

Consumers turn away from low-quality, low-price retailer-assembled products

2014/05/08 | By Ken Liu

By CARMEN LO

Although products assembled by retailers still dominate mainland China's LED-lighting market, branded products supplied by lighting manufacturers are increasingly popular because of disappointment about the poor quality of retailer-assembled lamps.

In the LED age, the term "assembled lighting" has come to represent “Three Nos”: no production scale, no marketing system, and no branding awareness.

“Three Nos” assemblers have naturally relied on cutthroat pricing to sell their products, resulting in a chaotic market in which brand name suppliers have difficulty gaining access to retailers.

Usually, the assemblers cut corners in their products in order to quickly seize market share with low prices. Even though they shun after-sale service and lifespan warranties, assemblers still win significant orders using this strategy.

Even as they gain market share, however, assemblers are losing credibility with buyers because of problems that surface with their products. Now, an increasing number of project contractors that stress quality are shunning this sub-standard "assembled lighting."

Lighting distributors are reluctant to risk the marketing obstacles that might result from the promotion of pricey brand name products, and this gives assembled lighting a wedge into the vast and highly competitive Chinese market.

The Chinese National Development and Reform Commission has published a roadmap for ridding the Chinese market of incandescent bulbs, fueling a nationwide wildfire of investment in the production of energy-saving replacements, notably LEDs.

China currently has over 8,000 LED application manufacturers and more than 20,000 traditional-lighting manufacturers, but only around 10% of the LED-lighting suppliers use brand names, engage in R&D, and operate distribution channels. A large number of the traditional-lighting manufacturers are moving into LED manufacturing.

Uncontrolled investment has led to an oversupply of LED lighting and, consequently, the closure of many LED-lighting producers. Most of the shuttered manufacturers were capitalized below RMB1 million (US$160,000 at RMB6.25:US$1), suggesting a trend toward big players growing bigger while small ones face extinction.

Homegrown Lighting Brands

China's homegrown lighting brands, however, have mushroomed over the past few years, thanks to the erosion of consumer confidence in poor-quality assembled lighting. Among the big names are the Guangzhou BiEr Electronics Co., Fujian Minri Lighting Technology Co., and Zhuhai Ltech Electronic Technology Co.

Guangzhou BiEr develops, produces, and sells LED lighting fixtures. With an in-house R&D team and a thorough quality management system, the company has released a series of "Ba Bier"-branded batten light tubes, recessed lights, down lights, bulbs, track lights, reflector lamps, panel lights, T5/T8 light tubes, projection lights, wall washers, underwater lights, underground lights, and streetlights.

The company also provides total solutions for indoor-lighting replacement projects as well as outdoor-lighting and building-exterior lighting projects. It pursues the latest eco-friendly technologies for its LED-lighting products.

Founded in 2006, Fujian Minri makes, develops, and sells "Minri"-brand LED displays and lighting, and provides contract installation services.

The company has rich experience in manufacturing and developing LED billboards and touch screens, providing products and installation services to a wide range of sectors including manufacturing, education, electrical power, telecommunications, finance, and national defense.

The firm assures high quality through excellent optoelectronic engineering, remote control technology, display technology, and other brand-new technologies, thanks to its 20-plus R&D specialists, patented technologies, and advanced manufacturing equipment.

Fujian Minri has in-house R&D, production, and maintenance units staffed by experienced engineers and controlled by a logical management system. In addition to selling domestically, the company also ships its products to Southeast Asia.

Zhuhai Ltech is among the mainland's first manufacturers of LED-lighting control systems, having been involved in the field for around 10 years. Its products go to market carrying the brand name “LTECH”.

Operating in Zhuhai's Nanping Hitech Industrial Park, the company makes LED dimming system products including DALT dimming drivers, RGB controllers, DMX512 drivers, power repeaters, serial peripheral interface (SPI) controllers, and LED control systems.

Zhuhai Ltech has deployed the Pb-free manufacturing process and ERP management system, making its products compliant with RoHS regulations and giving them ISO9001 certification.

Diligent R&D and product upgrading efforts have won the company the China Lighting Award from the China Association of Lighting Industry as well as a Guzhen Lighting Fair award.