40 years of reform and opening up

Loyalty to China and cheap labour made Hong Kong toy tycoon Lam Leung-tim a mainland factory pioneer – with a yellow rubber duck

  • Company banked on joint ventures to bring in American toy lines and rode fame of its iconic yellow rubber duck
  • Son Jeffrey Lam recalls hardship days of hostels with hole-in-floor toilets on business trips to Dongguan, and factories with erratic electricity
PUBLISHED : Friday, 23 November, 2018, 1:34pm
UPDATED : Friday, 23 November, 2018, 3:47pm

Jeffrey Lam Kin-fung was in his 20s when his father, toymaker Lam Leung-tim, was among the first Hong Kong factory owners who moved to the mainland as China began opening up its economy in the late 1970s.

“There was no direct bus, no high-speed rail,” the younger Lam recalled. “After crossing the border in Lo Wu, we could only take trucks with wooden seats tied onto them.”

Dongguan, north of Shenzhen, was the place many Hong Kong manufacturers headed for to set up factories making everything from toys to electronic parts, clothes and watches.

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“There was no paved road outside Shenzhen city,” he said. “It took us three to four hours on the bumpy, sandy lane to Dongguan, which you can reach in just half an hour nowadays.”

Lam, now 67, never forgot the shabby hostel where the Hongkongers stayed on those trips, with its hole-in-the-floor toilet set right above a fish pond.

Forward Winsome Industries was founded by Lam Leung-tim in 1960 through a merger of two older toy firms – one of which he had worked for since 1947.

He made his name in 1948 by launching the yellow “Lamon Tea” rubber duck, which has endured and gained fame around the world. He made his fortune selling plastic toys to American companies Hasbro and Hallmark, including precursors to Barbie, G.I. Joe accessories and Transformers toys.

He became known as Hong Kong’s toy tycoon.

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Even before Deng Xiaoping began opening up the Chinese economy in the late 1970s, Lam visited the mainland in 1976 to explore business opportunities. It was his first trip back since the 1950s.

“The conditions in the factories I saw were so poor that I felt I should help,” he said in an interview last year.

The toy tycoon, now 94, said he felt a deep loyalty to China and wanted it to have a toy manufacturing industry to rival Japan’s position in the market.

Jeffrey Lam, who was 23 when he joined the family business in 1974, believes his father’s patriotism and the cheap labour available on the mainland were behind their decision to set up the Dongguan factory.

The conditions in the factories I saw were so poor that I felt I should help
Lam Leung-tim, toy tycoon

He recalled that they had no trouble getting workers because there were long lines of mainlanders queuing for jobs on offer at the new Hong Kong factories.

But, given the harsh living conditions, the company had to offer a “hardship allowance” to persuade Hong Kong managers to come over and run the operations.

Even after assembling its team of workers and managers, keeping the factory lines humming was a challenge because of the erratic electricity supply.

“Blackouts happened all the time, like three days in a week. Many factory owners had to bring their own power generators from Hong Kong to ensure stable operations,” Lam said.

Their Dongguan factory opened in 1979 with 20 workers engaged mainly in painting figurines and assembling toy robots.

By 1982, the company had opened two more factories in Guangdong province, and by the end of the 1980s, its mainland workforce had swelled to 18,000.

In 1988, the company crossed a milestone with a joint venture involving a mainland company to import Transformers toys from the United States.

Blackouts happened all the time, like three days in a week. Many factory owners had to bring their own power generators from Hong Kong
Jeffrey Lam, Forward Winsome Industries

“We saw the growing market and gave it a try,” Jeffrey Lam said, explaining that toys could not be imported to the mainland at the time except by joint venture partners.

“They really were a hit all over the country,” he said, recalling how desperate customers broke a display window in a Shanghai mall in their eagerness to get their hands on the shape-shifting robot figurines.

In the 40 years since his first trips to the mainland, he has seen Shenzhen transform into a metropolis of shining high-rise shopping malls and large hotels no different from those in Hong Kong.

These days, Jeffrey Lam is focused on his political commitments as a policy adviser in Hong Kong leader Carrie Lam Cheng Yuet-ngor’s Executive Council, as well as being a representative of the business sector in the Legislative Council.

He remains managing director of Forward Winsome Industries, and his only son, Victor Lam Hoi-cheung, a graduate of Cornell University, is general manager. Patriarch Lam Leung-tim is the chairman of the company and still active, enthusiastically promoting the yellow rubber ducks that helped him make his fortune.

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The company still runs three factories in Guangdong province – two in the Lams’ ancestral hometown of Nanhai, Foshan, and one in Qingyuan.  

“Our company is still manufacturing toys and gifts, and our markets are all over the world – selling to the US, the EU and Japan, among others” Jeffrey Lam said.

He believes China’s policy of reforming its economy and opening up has been beneficial to the mainland and Hong Kong as well.

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He said: “Shenzhen’s Gross Domestic Product has surpassed Hong Kong’s now. But some mainland officials still tell me today, ‘We wouldn’t be the same if you Hong Kong factory owners had not come to the mainland early.’”

Lam is convinced China’s next big thing lies in the “Greater Bay Area” – the plan to link Hong Kong, Macau and nine mainland cities in the region to create an innovation hub to rival Silicon Valley.

“With the improvement of living conditions among mainlanders, I think education and medical services are set to enjoy a boost,” he predicted.

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