Optical-products manufacturer Auto-Winner aims to realign its marketing and manufacturing strategy towards branded eyewear as mainland competition is forcing the company out of low-end, price-sensitive products. Manager Kerry Chan Ka-wai says Auto-Winner is also moving away from third-party manufacturing, often called original equipment manufacturing (OEM), because growing competition has hurt already slim margins in the contract business. Manufacturing output is to move from the present 80 per cent OEM and 20 per cent house-branded products to 65 per cent OEM and 35 per cent house brands. 'Because of growing competition in China, particularly Wenzhou, in Zhejiang province, they [mainland firms] can make very good quality products at really low prices,' Mr Chan says. 'To be competitive, we are looking at more opportunities to develop more brands, because, when using brands, we have our name telling people we are capable of making world-class glasses.' Auto-Winner was one of the first eyewear manufacturers in Hong Kong to produce frames under its own label. Today the company produces and markets eyewear in-house under five brands - Volgari, Maniac, Simon Yam, Me-2 and Louis Koo. The firm also does makes eyewear for Katherine Hamnett. 'The success of our house brands in the European market, such as in Britain, Spain and France, shows that our brand is being noticed and recognised worldwide,' Mr Chan says. 'As a result, we will launch new style products and distribute them globally in the near future. Our goal is to position our brand on a global basis. Of course, we will keep original design [manufacturing] and consolidate our customers' confidence.' Last year the company made more than 2.5 million pieces of eyewear. To broaden buyer awareness of its branded product line, Auto-Winner has taken seven booths at this year's Optical Fair. 'When we see someone who is interested in selling our brands in their countries, we have to see that they are really serious about it,' Mr Chan says of the screening process that all potential distributors must submit to. 'Sometimes they just want to take our products and copy them. We also have to look at their marketing plan for our brand. Our products are in the US$100 range, so they really have to promote in that product category.' Auto-Winner's design team produces between 10 and 20 design prototypes each week, of which about 10 per cent are likely to make it into production. New products can be viewed at the firm's showroom in Hong Kong or at its factory in Dongguan. Auto-Winner is a privately held company employing more than 1,000 people at its main optical manufacturing facility in Dongguan. Annual production is expected to jump to between three million and 3.5 million pairs of glasses this year, thanks in part to a second manufacturing facility that came into operation in the fourth quarter of last year. The company was awarded ISO 9001 certification for its quality management systems in September 2001. Mr Chan expects metal frames such as titanium to remain popular in the prescription eyewear category. Aluminium frames in a range of new colours are also expected to be popular. The company will continue to build its plastic sunglass frames from imported Italian materials. Research initiatives include the use of a new class of 'memory metals' from Japan. Frames constructed of these materials are light, flexible, and tend to spring back into shape when distorted.