May 25, 2009
Packaging Machinery Makers in Taiwan Tap Years of Experience to Cope
With over half a decade of development, Taiwan`s packaging machinery industry has come a long way, during which it has built a variety of innovative products to meet global trends; while years of evolution enable Taiwan suppliers to work with foreign customers to develop customized machines that are multi-functional.
While theoretically packaging machinery makers in Taiwan believe upgrading mechanical sophistication is the way to be more competitive, but such efforts also pave an easy way for rivals from developing nations to copy and produce similar machinery at lower prices, with such underselling embroiling Taiwan makers in hardship for some years. Undeterred and unwilling to regress, Taiwan makers have been focusing on developing high-end precision machines adaptable for green packaging materials.
Besides having to cut cost to stay competitive due to surging raw material costs, Taiwan makers claim they can`t justify passing on added costs to customers amid harsh competition and the global downturn, which has slashed output and exports from Japan, China, India, Malaysia and other developing nations.
K.H. Lin, chairman of the China (Taipei) Packaging Association, says as the world demand for fragile packaging increases, Taiwan manufacturers of packaging machinery have to meet such need by enhancing sophistication, automation and multi-functionality. "In addition, manufacturers have to improve operating means and elevate core manufacturing skills to stay ahead in the highly-competitive world market," Lin notes.
Local Market Waning
An industry insider says the Taiwan market for packaging machinery has been on the wane, which may worsen in light that exports will continue to fall in the near term amid the global downturn, and manufacturers are keeping an eye on emerging markets in Vietnam and China. Two issues make tapping the China market difficult currently: numerous export-dependent factories in China have gone under due to the recession, hence compromising demand for packaging machinery; while mainland Chinese makers have been succeeding to beef up their own strength over the past several years.
Besides, the generally lower costs in China pare margins to paper-thin levels: For instance, a single-function sealing and packaging machine in China is quoted at less than 1,000 renminbi (RMB), which is close to its cost.
To help Taiwan manufacturers of packaging machinery survive the global marketplace, especially the current recession, the China (Taipei) Packaging Association suggests resource integration or mergers, calling for larger makers to work with smaller ones-pooling operating resources-to better their chances of survival. For example, a small order may be more efficiently filled by a modest-sized operator for its lower fixed cost.
While the chilly economic winds buffet global markets, Taiwan makers of packaging machinery are still figuring out ways to innovate to survive. The following highlights a few Taiwan makers who are coping with market volatilities to find niches, perhaps not prospering but definitely showing ingenuity to achieve sustainability.
Source:CENS