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Manufacturers show they have what it takes to drive their own brand concepts and original product lines, and this can only benefit China firms

HONG KONG IS uniquely positioned to benefit from China's economic transformation.

Hong Kong's role will be critical in helping Chinese companies move up the value chain through design services that add value to products.

Many manufacturing companies in Hong Kong have gone from being an original equipment manufacturer (OEM), to an original design manufacturer (ODM).

Factories have been moved to the mainland to save on costs, but head offices remain in Hong Kong, where new product ideas and marketing strategies are generated. Nova International is one such company.

Even though it is one of the top five OEM electronic appliance manufacturers in the world, Nova decided to strike out as an ODM with its own brand concept and an original product line.

Instead of making conventional electronic appliances, the company ventured into making products for pets under the brand name Just Pet.

General manager Wylie Lai said the move was possible partly because the company, which has more than 1,000 employees, had relatively young people in the management ranks and they had a lot of creative energy. The average age of staff is less than 40 years.

'We were ready to think outside the box and try new ideas,' she said. 'This led us to start Just Pet, after we noticed that consumers were spending an increasing amount on their pets.'

Ms Lai said pets were often treated like family by their owners, and therefore deserved a lifestyle of the same quality enjoyed by the family.

'We have a line of pet furniture, but unlike conventional pet furniture on the market, which you can identify instantly as pet furniture, our products are based on trendy designs and are made of leather. They look like real [high-quality] furniture.

'We aim to appeal to people's liking for novelty. We also have a pet washer that produces bubbles in the water, and a pet nail trimming machine.

'Consumers see the fun side of these products and are willing to give them a try.'

Nova has been targeting the European and United States markets in the past two years with considerable success.

Ms Lai said Just Pet products distributed in high-end department stores in Europe sold really well. Now the company was bringing the brand back to Asia.

'In a consumer environment such as Hong Kong, branding and marketing are the keys to success.

'We have spent a lot on hiring one of the 4A advertising firms to create a marketing strategy and help us build our brand.'

Another company that switched from OEM to ODM is Ascent Accessories.

The company has been designing its own products, including metal ashtrays and other metal products, since 2000, and recently started a wine accessories collection.

The company often competes for international design awards.

Assistant marketing manager Isaac Tsang said people were no longer satisfied with traditional and basic designs.

'The younger generation of consumer is willing to spend more on functional, well-designed and good-quality products.

'Our ashtrays in no way follow traditional designs. They are made of coloured metal and precision components.

'The wholesale price is more than $25 each and the retail price is more than $100. But consumers think that they are worth the price and are willing to pay.'

Advance Bright marketing manager Simon Lee said it was just as important to find a balance between quality and cost.

'As a leader in the plug-and-play TV games industry, we are more competitive because of good research and development work and our innovations, and also because of our low price.

'It is not possible for us to make the highest quality products. It is always about balance. What's the point of making high-quality but expensive products that people appreciate but can't afford?'

Mr Lee said innovation came from designing quality products while keeping them cost effective.

'Our new Papagame has no language barrier. The players just have to react to the colours.

'That saved us a lot of translation and production money, and made it easier for us to distribute the game to other countries,' Mr Lee said.



Creative Hong Kong has designs on market