Competitive Maker of Small Home Appliances

(Yicai) Oct. 13 -- China is still the most competitive production hub for small home appliances despite the frequent changes in US tariffs in the past six months prompting some small- and medium-sized exporters to explore building factories abroad, according to industry insiders.

Luckyway Home Appliances was planning to set up a plant overseas in Cambodia or Malaysia six months ago, but after on-site inspections, related plans were scrapped, General Manager Li Mingyang told Yicai yesterday. A large proportion of Luckyway's electric fans is exported to the United States, and the company still entirely produces at its factory in Zhongshan in southern Guangdong province.

The monthly salaries of Malaysian workers have risen 7 percent to 8 percent compared to six months ago, and factory rental costs have also increased, Li said, adding that manufacturing costs and supply chain capabilities of the Chinese small home appliance industry remain the most competitive globally. The inadequate supply chain support is another challenge Chinese small home appliance companies face when planning overseas expansion.

Only about 15 percent to 20 percent of the small appliances made in Cixi, known as China's small home appliance hub, are exported to the US, Yu Xuehui, founder of Cixi Home Appliances Store, told Yicai. Cixi has formed a highly efficient supply chain cluster where any component can be delivered within an hour, and there are multiple suppliers for each part, Yu explained. This kind of complete industrial ecosystem is hard to replicate elsewhere, which is a key advantage for Chinese manufacturers.

Many Chinese small home appliance companies have shifted their focus to other markets such as Southeast Asia, Europe, and the Middle East to offset the impact of US tariff adjustments. Some enterprises have also accelerated technological innovation and product upgrading to enhance their added value and competitiveness. For example, more and more products are integrating smart functions and energy-saving technologies to meet the diverse needs of global consumers.

In addition, industry experts pointed out that while the US tariff policies have brought short-term pressure, they also provide an opportunity for the transformation and upgrading of China's small home appliance industry. Enterprises that can adapt to the changes and enhance their core competitiveness will be able to gain a firm foothold in the global market in the long run.