Gaming firms have eye on overseas markets

Zhongshan charts ambitious plan to become a global design and manufacturing hub

Entertainment equipment manufacturing companies from Zhongshan are looking to make inroads in overseas markets, even as the city strives to be the global design and manufacturing hub for the entertainment industry.

"We have been making aggressive strides in the global markets recently. As part of this, we plan to participate in at least five to six international exhibitions every year, mainly to promote our products and explore new business opportunities," says Deng Zhiyi, president of the Zhongshan Game & Amusement Association.

Deng says that he expects more gaming companies from Zhongshan to participate in international exhibitions and trade fairs.

Ye Weitang, president of Golden Dragon Amusement Equipment Co Ltd, a Zhongshan-based games and amusement equipment maker, says that though the global market is estimated at around $100 billion yuan, Chinese companies account for just $6.4 billion of the total pie, thereby giving ample opportunities for further growth, he says.

Part of the reason why Chinese companies are still lagging others in the global market lies in the quality and R&D advantage enjoyed by countries like the US and Japan. But with Chinese companies gathering output pace and putting more focus on quality, it is only a matter of time before they catch up with competition, Ye says.

Golden Dragon has already made rapid strides in markets like the Middle East, East Europe and the US and overseas business accounts for more than 40 percent of the total business. "Overseas business has been clocking annual growth rates of 20 percent to 30 percent and going forward I expect it to be around 60 percent."

Ye says that he expects companies from Zhongshan to be the key players in the global market over the next five to 10 years.

Similar sentiments are echoed by Deng, who believes that Chinese companies can now make products that are as good or even superior to the ones made by their Western counterparts. He feels that manufacturing costs for Chinese companies are less costly than others due to the lower labor and raw material costs. "The price of products made in Europe can be three to five times more expensive than those made in China."

Liang Guoqiang, general manager of Zhongshan G-Look Amusement Machine Co Ltd says that his company's long-term plan is to integrate more Chinese cultural elements into its products and export these to the overseas markets.

Liang, however, says that though Chinese companies are fast catching up in production techniques, they still have a lot to learn from their Western counterparts, especially on aspects like business operations.

"After several years of development, many of the developed countries are now capable of producing gaming equipment with better quality and in large scale. The biggest advantage they enjoy over Chinese companies is their understanding of the business, gained largely from their advanced manufacturing techniques for equipment manufacture.

"Though several China-made products have achieved similar production levels, they still lag in safety aspects. We should learn from their techniques and make the necessary changes," Liang says.

Though he agrees that Chinese companies need to add more cultural elements to their products, the process also calls for improving the levels of innovation and R&D.

Part of the answer to that puzzle may come when companies in Zhongshan decide to pool their resources and form a cohesive group to tap global markets, experts say.