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H.K. Electronics Fair Autumn 2006
2007/10/23
 | | At the opening ceremony: (from left) Klaus Dittrich, managing director of Munich International Trade Fairs; Fred Lam, executive director of TDC; Hon. Joseph Wong, secretary for the HKSAR; and Dr. Roy Chung, chairman of TDC`s Electronics/Electrical appliance Industry Advisory Committee. |
A total of over 2,480 exhibitors from 29 nations and regions around the world showcased quality and innovative products during the Hong Kong Electronics Fair (Autumn Edition) 2006 held at the Hong Kong Convention and Exhibition Centre (HKCEC) from October 13 to 16, making it the largest consumer-electronics fair in Asia and No. 2 in the world.
Organized by the Hong Kong Trade Development Council (HKTDC), the Hong Kong Electronics Fair may grow further to be the world`s largest event of its kind when the expansion of the HKCEC is completed in 2009, which will add around 1,000 booths.
Held simultaneously was the electronicAsia 2006, a professional trade fair for components, assemblies and electronic production and display technologies, that attracted 540 exhibitors from 14 countries and regions, with the show being jointly organized by the TDC and MMI-Munich International Trade Fairs Pte Ltd.
 | | Global buyers crowd into the Hong Kong Electronics Fair (Autumn Edition) 2006, spilling out the entrance. |
 | | The seminar on RoHS and WEEE drew a large audience. |
The two fairs together occupied over 4,400 booths.
The final numbers show that a total of 57,791 visitors went to this year`s fair, up 7.06% from last year`s, including 24,843 local visitors and 32,948 foreign buyers. The top-10 foreign visitor countries included mainland China (9,264, up 7.91% from last year), the United States (2,575, up 9.53%), Taiwan (2,441, up 14.39%), South Korea (1,664, down 8.42%), Japan (1,126, down 2.34%), Germany (984, up 2.82%), the U.K. (979, up 11.63%), Australia (942, up 9.79%), India (737, up 9.51%), and Italy (726, down 11.57%).
The major categories at the Hong Kong Electronics Autumn included Audio/Visual (a/v) Products, Digital World, Electronic Accessories, Home Appliances, Home Tech, Multimedia and Electronic Gaming, Office Automation and Equipment, Personal Electronics and Multimedia Products, Security Products, Telecommunications Products, and Trade Services
The fair featured a marketing platform to showcase the latest developments in the industry, with four special zones spread out over the venue.
1.Digital World (New)--The Expo Drive Hall is a newly-modified parking lot that accommodates more booths and has been organized to showcase a new zone featuring digital entertainment, digital imaging, digital communications, digital gadgets, digital multimedia products offered by 190 exhibitors.
2.Home Tech (New)--Also located in the Expo Drive Hall, this new zone featured intelligent home appliance/home automation, home security, and healthcare electronics products from 148 exhibitors.
3.Technology Exchange Zone-Taking brilliant concepts to the market, universities and incubators displayed new research projects and prototypes for tomorrow`s applications and production. Among the participating institutions were newcomers Hong Kong University of Science & Technology and incubators from Hong Kong Science & Technology Parks.
4.Hall of Fame--Introduced in 2003, the Hall of Fame highlighted globally-renowned brands of electronics, including complete items and parts and components. Some 158 exhibitors showcased their products in this section, including big names from Hong Kong, mainland China, Taiwan, South Korea, Turkey, Italy, the U.S., Switzerland, Hungary, Japan and Spain.
Choosing this fair as their marketing platform, a number of notable brands showcased premium electronic products and components, including Haier, Midea, Changhong, TCL, Hisense, GIEC, Galanz, Mobicool, OTO Bodycare, Duracell, Panda, VTech, Skyworth, Alco, Ngai Lik, Star Light, Fujikon and Goodway.
"Both the Hong Kong Electronics Fair (the 26th in 2006) and the electronicAsia (the 10th) have been seeing consistent growths, with many exhibitors still on the waiting list," points out Rebecca Tse, manager of HKTDC marketing communication.
Tse attributed the high growth rates of the two shows to the advantages inherent to Hong Kong, including the rapid-rising number of exhibitors from mainland China, Hong Kong`s superior infrastructure in terms of degree of internationalization, proximity to the huge Chinese market, convenient international access, and high efficiency.
"According to our surveys," she stressed, "a high rate of 85.29% of Hong Kong-based exhibitors come to the show every year, which is a key indication of its effectiveness."
 | | The Hall of Fame housed big-name brands under one roof. |
 | | The two annual fairs have become sourcing hubs for high-quality, competitively-priced products. |
Practical Seminars
In addition, a series of richly-contented seminars were held throughout the show by key industry experts who shared views on market trends, business opportunities and challenges of electronic products. A sample of the topics included "Latest RoHS & WEEE Policies & Enforcement;" "Latest Regulations of ITE and AV Products in China/International Market;" "Electronics and Appliance Safety Symposium--Accessing the U.S. Market;" and "Development and Future of Bluetooth Wireless Technology and its Applications."
According to HKTDC, electronics is the biggest export earner for Hong Kong, garnering a 48% share of the city`s total exports. In the first eight months of 2006, Hong Kong electronics exports reached US$96.9 billion, an increase of 14% over the same period of last year.
"Hong Kong`s electronics industry is escalating up the value chain by investing heavily in R&D, production engineering and branding," said Chairman Roy Chung of HKTDC`s Electronics/ Electrical Appliances Industry Advisory Committee. Incidentally, nearly half of Hong Kong`s exports to the world are now classified as high technology products, according to the Organization for Economic Co-operation and Development (OECD).
Survey Findings
An industry survey found that electronics buyers are on the hunt for home-entertainment and A/V products like LCD TV sets and personal electronics for 2007.
Other hot items included the all-in-one multimedia devices like third-generation (3G) telecom products, PDAs, MP4 players, multimedia players, air purifiers and car navigators.
The HKTDC commissioned an independent market research company, Oracle Addedvalue, to conduct a survey at the fair, with a total of 712 buyers and 423 exhibitors being interviewed.
On the market outlook, over 60% of respondents expect 2007 to be better or slightly better than 2006. Exhibitors and buyers from the mainland China are the most optimistic respondents, believing that the overall market growth will reach 11%-13%.
A group of 62% of the interviewed buyers said they had placed more orders and increased their purchase quantity of each order this year. Close to 70% of the surveyed exhibitors said markets that have the highest growth potential include China, India, South East Asia, Russia, Eastern Europe and Central European countries, with the average estimated growth rate for these markets next year to be 17%, slightly higher than that of the U.S. and Western European markets.
About 30% of the responding buyers said they would source from OBM suppliers. Over 80% said they were willing to pay an average 11% premium for a Hong Kong branded item over a Hong Kong OEM item. Such a trend is a reflection of the rationale behind setting up the "Hall of Fame" at the show, HKTDC claims.
In the face of increasing "green" regulations, 80% of exhibitors showed their readiness to comply with product standards. On the other hand, 48% of surveyed buyers intended to source more "green` products". Buyers said they were willing to pay an extra 9% in average unit price as a result of compliance to "green" regulations.
 | | K.B. Chan (middle) publicized his carefully-culled observations of market and product trends to the media. |
Other Surveyed Tidbits
1.About 60% of interviewed buyers said Hong Kong/Southern China is the preferred region for new suppliers, followed by Shanghai/Yangtze River Delta.
2.Of the exhibitors, though preferring the U.S., Canada and Western Europe for new buyers, 21% showed interest to find new buyers from Russia, Central and Eastern Europe.
3.A group of 67% of interviewed buyers plan to source more from Hong Kong-based companies for their quality workmanship, design, reliability, price competitiveness and good business practice.
4. Some 30% of buyers tended to source more branded products, with brand reputation being important for electronic products. Some 81% of buyers were willing to pay a premium for Hong Kong-branded items.
5.Traders find new buyers/suppliers primarily via Hong Kong trade fairs, and secondarily through websites and trade publications.
6.Over 40% of the buyers are facing difficulties in sourcing "green-compliant" products, with both price and dedicated suppliers being problematic issues.
Hong Kong Electronics Fair (Autumn) Exhibitors | Year | Hong Kong | Growth | Foreign | Growth | Total | Growth | 1998 | 922 | 66.4% | -- | 466 | 33.6% | -- | 1,388 | -- | 1999 | 906 | 61.8% | -1.7% | 561 | 38.2% | 20.4% | 1,467 | 5.7% | 2000 | 950 | 61.8% | 4.9% | 588 | 38.2% | 4.8% | 1,538 | 4.8% | 2001 | 1,052 | 64.5% | 10.7% | 580 | 35.5% | -1.4% | 1,632 | 6.1% | 2002 | 1,127 | 64.7% | 7.1% | 616 | 35.3% | 6.2% | 1,743 | 6.8% | 2003 | 1,264 | 64.8% | 12.2% | 686 | 35.2% | 11.4% | 1,950 | 11.9% | 2004 | 1,311 | 64.6% | 3.7% | 718 | 35.4% | 4.7% | 2,029 | 4.1% | 2005 | 1,360 | 64.2% | 3.7% | 760 | 35.8% | 5.8% | 2,120 | 4.5% | 2006 | 1,509 | 60.8% | 11% | 973 | 39.2% | 28.0% | 2,482 | 17.1% | Source: TDC. |
Market Trends
Such survey findings show clear directions in the market and product trends, which are also borne by the observations made by Professor K.B. Chan, chairman of Hong Kong Electronic Industries Association (HKEIA) and managing director of Surface Mount Technology (Holdings) Ltd.
According to Oracle Addedvalue, the 2006 electronics fair revealed some new product and market trends, such as the home-entertainment, A/V, personal electronics, and home-appliance products are regarded as the highest growth categories in 2007. Second, among home-entertainment and A/V products, LCD TVs are expected to undergo the biggest growth. Third, in the personal electronics category, all-in-one multimedia devices are the stars. Fourth, air purifiers, air conditioners and induction ovens are believed to have the highest growth potential in the home-appliance category. Fifth, both exhibitors and buyers want to deal in global positioning system (GPS) products (30% of exhibitors and 38% of buyers), and products using radio frequency identification (RFID) technology (26% of exhibitors and 31% of buyers).
Regarding the product categories having the fastest growth and of 1,135 exhibitors and buyers, 305 voted home-entertainment and A/V products as No. 1; 294 voted personal electronics as No. 2; and 260 said home appliances is No. 3.
Of the fastest-growing products in the home-entertainment and A/V product categories, 49% said LCD TVs is No. 1; 9% voted home theater entertainment units as No. 2; and 9% said HD TVs are third; and 8% voted PDP TVs as No. 4. For personal electronics, the top-three are all-in-one multimedia devices (39%); MP4/multimedia player (18%); and digital cameras (15%). Of home appliances, they are air purifiers (20%), air conditioners (19%), and induction cookers (11%). Among information technology (IT) and multimedia products, the fastest sellers are networking equipment (29%); laptop and notebook PCs (23%); handheld computers/PDAs (23%); and multimedia production and writing tools (16%).
In terms of electronic accessories, the top-three are cable and cable accessories (40%); batteries (18%); and transformers (13%). Of car electronics, the leading sellers are car navigators (45%); car audio items (28%); and mobile video items (8%). The best selling telecom products are 3G products (25%); PDA phones (23%); and voice-over-Internet protocol (VoIP) phones (15%).
Hong Kong Electronics Fair 2006 (Autumn Edition) Visitors Summary | | | 2006 | 2005 | Growth | Total Overseas | 32,948 | 30,649 | 7.50% | Total Local | 24,843 | 23,331 | 6.48% | Total | 57,791 | 53,980 | 7.06% | Top-10 Visiting Foreign Countries | Mainland China | 9,246 | 8,568 | 7.91% | U.S. | 2,575 | 2,351 | 9.53% | Taiwan | 2,441 | 2,134 | 14.39% | South Korea | 1,664 | 1,817 | -8.42% | Japan | 1,126 | 1,153 | -2.34% | Germany | 984 | 957 | 2.82% | U.K. | 979 | 877 | 11.63% | Australia | 942 | 858 | 9.79% | India | 737 | 673 | 9.51% | Italy | 726 | 821 | -11.57% | Source: HKTDC |
Turning Green
Regarding "green manufacturing", the surveys also revealed some trends. First, a vast majority of exhibitors (86%) were ready to comply with environmental protection requirements, for which they would go green in terms of packaging, product design, labeling, supplier selection and management, and production processes.
Second, around half of the buyers will source more environmentally-friendly products.
Third, traders generally agreed that unit prices would increase, a price paid for being green compliant.
HKEIA`s Dr. Chan offered insights related to market trends based on his long industry and business expertise. First, Chan thinks LCD TVs will be the star product, especially soon after China defines its strategies for high-definition, or HD, TVs. Second, the set-top-box (STB) is also expected to be in big demand about the time when the market shifts to digital TV programs. Third, the demand for plasma display panel (PDP) TVs will also jump in the digital-TV era. Fourth, the prices of electronics products will not necessarily drop when the "green sourcing" and material-advancements have been realized. He also predicts that the "green-sourcing" difficulties currently seen are expected to dissipate in 2007. Fifth, Hong Kong is likely to be a so-called "platform of convergence" that integrates all the R&D, design, manufacturing, and international marketing know-how to enhance its overall global competitiveness in the electronics sector.
(by Quincy Liang)
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