M.C. Cheng, president of Honiton Industries Inc. was elected chairman of the Taiwan Hand Tool Manufacturers` Association (THTHA) at a regular trade meeting held in early November this year, making him the 11th man to head the association, which represents over 370 Taiwanese hand-tool manufacturers.



After taking over the official seal from the former chairman, Charlie Hsieh, Cheng made a brief statement on what he will do during his three-year term. He said he will continue to promote Taiwan hand-tool brands in global market and set up a dedicated hand-tool industries on the island, which is under plan now.



As part of the association`s effort to help members promote brand names, he said the association will open a shop on the planned industrial zone to showcase members` latest tools. The zone will be built on a 110-hectare site appropriated by landowner Taiwan Sugar Corp., a state-run enterprise. According to the association, the state-run Taiwan Sugar Corp. in late July this year agreed to put aside nearly 100 hectares of land for the park construction.

"Most Taiwan-made tools are going to global markets generically although they are of good quality and good designs. The shop will help strengthen the image of Taiwan-made tools and offer international buyers a one-stop shopping window," he noted.



Cheng, whose company specializes in sock wrenches, stressed that Taiwanese hand-tool makers need a dedicated industrial park in light that the underselling threat from mainland Chinese rivals, as well as high land costs at certain locations on the island.

The association plans to limit the land price in the zone within NT$17,000 (US$515 at US$1:NT$33) per ping, or 36 square feet, by developing the zone on its own. Currently, average land prices at industrial parks elsewhere on the island are about NT$50,000 (US$1,515).

The association estimates that the island`s hand-tool revenue will likely surge past NT$300 billion (US$9 billion) in 2015 when the dedicated industrial zone is completed. Also, it projects the Taiwan industry will keep growing steadily at an annual rate of at least 10% over the next few years thanks to the rollouts of high value-added products like digital tools and medical tools.

Last year, Taiwan exported US$2.5 billion of tools, up 4% from a year earlier. In the first five months of this year, the export value of the Taiwan industry totaled NT$36.1 billion (US$1.09 billion), surging 8% year over year.

The outgoing Hsieh said that he had achieved his mission during his tenure and it was about time to hand over the reins. Hsieh is noted for his efforts in promoting digital technologies integrated into tools and expanding overseas trade promotions during his three-year term that began Sept. 2004.

Hsieh also emphasized Taiwanese tool manufacturers need to build brand names on global markets since quality Taiwan-made products are wining popularity worldwide. "That`s why we began to open a Taiwan pavilion last year at major trade shows globally. Promotion collectively can more effectively catch global attention than can individually in terms of building brand profile," he said.

The need to build brands resonated the voice of the invited Cynthia Kiang, director of Department of Trade Development of the Bureau of Foreign Trade under the Ministry of Economic Affairs. "Contract manufacturing can only generate one fifty-seventh the profit that brand operation produces," she said, citing a study by Business Week.

Kiang noted that the government will spend some NT$1 billion (US$31.2 million) in seven years ending in 2014 to help Taiwanese manufacturers, including those in the hand-tool segment to promote brand names globally. "Besides, the government has set aside NT$30 billion [US$937 million] to help domestic manufacturers to promote brand names," she added.



Also an invited VIP at the conference, Ching-tsong Kou, vice president and general manager of China Economic News Agency of Taiwan, pointed out that quality and design are becoming the core values of hand tools and one of the major factors driving such value is eco-friendliness. "The European Union has imposed RoHS on power tools and many global economies have made similar moves to protect the environment. In addition, an increasing number of American consumers have ditched gasoline-powered mowers to switch to manually operated mowers," he said.

Citing a Home Channel News piece, Kou noted that the "BRICS" markets are emerging as promising markets for hand tools and British retailer Kingfisher will increase its stores in Russia alone to 50 in five years. "Kingfisher estimates that the Russian DIY market to be worth about US$23 billion a year," he said.


(by Ken Liu)