Guangdong Kexin expands ‘green’ products

	Ke Yan Dong, CEO of Guangdong Kexin

The maker is broadening its LED light selection while boosting production capacity for main line SMD components.

Guangdong Kexin Industrial Co. Ltd specializes in SMD components such as diodes, triodes, ICs and capacitors. It also makes halogen- and lead-free “green” products. Thanks to a strong R&D background, the supplier has developed up-to-date blocked LED lighting technology and released a new series of diode-based models. It boasts a number of local patents.

Here are excerpts of Global Sources’ interview with CEO Ke Yan Dong about the company’s product launches, capacity expansion and current challenges.

We will launch high-power LED lights for engineering applications in the next six months. We now use diodes with a wider viewing angle of 360 degrees than the 270 previously adopted. The feature enhances our products’ energy-saving and environment-friendly qualities because it spreads out illumination and covers a larger area.

With the recovering economy and our market expansion in Southeast Asia, our exports increased by 25 percent in 1H10, hitting a new record in the company’s history. This will grow further in the next six months. In fact, we are eyeing a 10 percent share of production capacity for our overseas business.

So far, we have doubled annual capacity to 10 billion SMDs this year to match the rising requirements of our customers. We continue to boost this, now focusing offshore such as in our OEM factory in the Philippines. Its production capability has reached 4.2 percent of the total for the whole group and accounted for 55 percent of overall exports.

Demand has picked up with the improving global economy, but this has also led to rising material costs. To keep prices stable, we try our best to reduce outlay.

We continue to streamline the production process further while ensuring output quality. As a result, the qualification rate of our products has increased to 98.2 percent from 96.7 percent.

We have also adjusted some departments and adopted an electronic ordering system to lessen operational expenses.

We believe price is not the only way to get ahead. Guangdong Kexin always considers the quality of products, related services and technical support the most important strategy to boost competitiveness. Our pricing is market-oriented. Now, we ship under our in-house Kexin brand to nearly 1,000 electronic terminal products manufacturers worldwide.

We have expanded our production capacity precisely to meet our customers’ needs. As demand increases locally and abroad, suppliers of electronic components should adapt to market changes and keep pace by reducing costs in order to boost manufacturing levels.

We should look at this issue on a case by case basis. Some suppliers consider labor costs for the move, while others may simply be looking for a better factory site. Whatever the reasons, we believe they are founded on the need for self-development based on the company situation and outside developments affecting operations. So, not all enterprises will follow this migration blindly. If the inland shift will bring great opportunity, then we should support their decision.

Take our company as an example. Guangdong Kexin targets destinations where foreign terminal products makers are based, not places with a growing demand for their products. Africa and the Middle East are such destinations, with a broadening consumer base. There are, however, no new OEM factories of international brands there. At present, we just watch for further developments in those regions. But once industries form there, we will spare no effort to gain entry.

I think there is no denying the revaluation of the yuan will definitely impact the export of China’s products. It will increase prices in their foreign currency equivalents, reducing local suppliers’ advantage and competitiveness overseas. This is unfavorable to the steady growth of the country’s economy.

When China entered the global market, we did not rely on the exchange rate but on the country’s low production costs, thanks to the availability of inexpensive material and labor resources. Now, we realize that a country’s currency exchange system should be part of the whole strategy in an open economy. In other words, it should be consistent with the national plan instead of serving exports only.

Established in 1987, Guangdong Kexin is a producer and exporter of a range of electronic components. A national high-tech enterprise, its operations include three manufacturing groups and eight wholly owned local subsidiaries. The company also has offices in the US, France and Singapore to serve global buyers effectively.

The supplier has developed its own brand but continues to nurture established partnerships with major players such as Panasonic, Mitsumi and Motorola.

The supplier has 28 fully automatic production lines, which have an annual output of more 5 billion units of SMD components.

For more details about Guangdong Kexin, visit www.globalsources.com/kexin.co