|
Computer case supply is booming in mainland China. More than 100 companies manufacture PC cases, with about 30 to 40 makers capable of filling customized, big-volume export orders. New makers continue to enter this line.
Leading suppliers are domestic-oriented companies with strong brand recognition, followed by export-oriented players whose only products are PC cases and who concentrate on OEM business. These two groups possess the manufacturing experience, maturity, marketing savvy and readiness to satisfy the sourcing requirements of global PC case buyers. A projected 32 million PC cases will be produced in mainland China in 2004, 60 percent of which are expected to be delivered to overseas buyers. Pitted against the mainland's homegrown suppliers are transplanted PC case manufacturers from Taiwan, who have clustered mainly in the Guangdong cities of Dongguan and Shenzhen, and in the provinces of Zhejiang, Jiangsu and Shanghai. These Taiwan-originated companies are among the global industry leaders with monthly production capacities exceeding 1 million units and whose OEM clients include Toshiba, NEC, Hewlett-Packard, Sanyo and Wal-Mart. Their business mode is high-volume and export-oriented. Backed by many years of manufacturing experience, Taiwan's PC case makers boast more sophisticated R&D capability and more reliable QC/QA systems than their counterparts from the mainland. Moving production to the mainland enabled Taiwan makers to cut off US$2 to US$3 from the costs of each finished unit. Competition, however, is not the only predicament of suppliers. A more acute issue is the high cost of steel and plastic, which account for 70 percent to 80 percent of a PC case's cost. Supply of steel and plastic began to tighten in 2003, and this situation is projected to last till 2005, possibly even longer. Most makers' responses have been to absorb the added costs and to settle for lower profit margins. Some have adopted cost-cutting measures such as the use of thinner steel sheets for housing. Other suppliers have negotiated with long-time customers to share the extra expense. For 2005, however, many interviewed companies revealed they will be forced to pass on the cost increase to buyers. On the average, FOB prices are forecast to rise 6 percent to 10 percent before the end of 2004, and by at least another 5 percent in 2005. Nevertheless, the severe competition brought about by a crowded supplier base is creating a wealth of sourcing options for PC case buyers. An abundance of case designs has emerged, as makers try to outdo each other in releasing PC cases that will appeal to most buyers. Differentiation is not limited to the layout and front-panel finish, but includes experimentation with transparent and three-dimensional side panels, and the use of aluminum or aluminum-alloy housings for high-end models.
Get the complete version of this report.
 All information contained in China Sourcing Reports is the result of exclusive, ground-level and definitive research conducted by Global Sources' analysts. Companies featured in these reports may or may not be clients of Global Sources.
|
