Consumers watch the operation of a window-cleaning robot at the 2018 World Robot Conference in Beijing in August. (Photo provided to China Daily)
Ecovacs evolves from OEM to smart appliance stalwart at home and overseas
Chinese manufacturers are outgrowing the phase when they were mere OEMs or original equipment manufacturers, or contract suppliers, for foreign companies; they are evolving into global-scale manufacturers in their own right by investing more in research and development.
Suzhou-based Ecovacs Robotics Co, China's largest in-home robotic products manufacturer by market share, exemplifies this trend.
It is all set to export its smart vacuum cleaners to markets related to the Belt and Road Initiative, having established a strong presence in developed economies such as the United States, Germany, Italy and Japan.
David Qian, vice-chairman of Ecovacs, said many opportunities come from consumers' growing income, and rapid development of modern infrastructure and internet facilities in certain economies. This is particularly true for the Middle East and Southeast Asia, especially in countries such as Thailand, Singapore and Malaysia. Growth opportunities are arising from both online platforms and retail channels.
Thanks to people's growing demand for robots that can perform tasks like cleaning the house, and free up some time, the company saw its revenue from service robot sales grow by 52 percent year-on-year to 2.87 billion yuan ($420 million) in 2017. Over 20 percent of its revenue came from exports. Qian plans to increase exports so they can generate 30 percent of its total revenue by 2020.
"We use customized products in different markets. For instance, the smart robot vacuum cleaners we sold to the US have to be equipped with large-capacity batteries as American homes are relatively larger than those in many other markets," said Qian. "Because of space limitation, we also found that low-noise robot vacuums are fairly popular in East Asian countries."
Qian, who majored in sociology and graduated from the University of British Columbia in Vancouver, said the company will continue to find competitive advantage in product diversity. Lower-noise, high-end battery-powered products, sensor applications, affordable prices and longer warranty are what will make the company competitive against established global rivals such as iRobot and Neato.
Unlike its main competitors that outsource or contract out manufacturing, Ecovacs is a vertically-integrated company. It does it all: research and design, manufacturing, marketing, sales and support. The company spends nearly 4 percent of its revenue annually on research and development, and operates two research facilities in Nanjing (which is focused on artificial intelligence and robots) and Suzhou.
