At the beginning of China's reform and opening up, processing industries were the pillars of Shenzhen's economy, with more than 90 percent of the industrial companies in the city being original equipment manufacturers, or OEMs. These companies didn't need their own designs and, with the advantage of low wages and low land prices, they could easily secure high profits. However, with the development of the market and changing demands for products, the seller's market became a buyer's market and competition in the manufacturing industry has been heating up. Meanwhile, Shenzhen no longer enjoys so many preferential policies, and operating costs have been rising accordingly resulting in the profit margins of OEM companies being reduced. Shenzhen faces the challenge of upgrading economic structures and seeking a more profitable production mode.
Against the backdrop of new changes and challenges, the industrial design industry emerged in Shenzhen. The number of industrial designers grew and, accordingly, many OEM companies converted to original design manufacturers, or ODMs, and original brand manufacturers, or OBMs. Some large companies in Shenzhen, such as Huawei, Konka and ZTE, realized the importance of industrial design. They set up industrial design departments in their companies and allocated research funds to industrial design and innovation every year. This has propelled the advancement of innovative design and raised the added value of products.
At the beginning, the development of Shenzhen industrial product design relied on the support of large manufacturers, such as Konka, Shenzhen Fiyta Group, China Vanke, ZTE Corp. and Huawei Technologies as they propelled the development of industrial design in Shenzhen. As a result, Shenzhen has grown into one of the leading industrial design cities in China. When large industrial companies were first established, independent industrial design companies were still unknown. A survey made by Shenzhen Economic Research Center shows that in 1995, there were only two registered industrial design companies in Shenzhen: Dragonfly Industrial Design Co. and Vanke Industrial Product Design Co.
With more companies establishing industrial design departments, the number of industrial designers in Shenzhen has been ever growing and many competent industrial designers from other cities were attracted here. Some entrepreneurs with profound foresight felt industrial design would be a profitable industry and established their own industrial design companies. Meanwhile, some outstanding industrial designers chose to be self-employed and established their own industrial design companies. The number of industrial design companies then increased rapidly.
At present, there are more than 200 industrial design companies in Shenzhen, and many companies, like Newplan Design, Artop Design, Xinlei Industrial Design, Toptone, Dingdian Design and Amber Design, have passed the primary difficult period and are building themselves into world famous large international design companies. Big companies like Konka, Huawei and ZTE have also established design departments in Japan, South Korea, Britain and the United States.
Design companies and design research departments of big companies not only intend to build themselves into big companies well-known in the Pearl River Delta region and on the Chinese market, but will also target high-end European and U.S. customers. Products designed by them are beginning to play a bigger role in the international market. Off-snow Rescue Devices designed by Newplan Design Co. and Konka mobile phone D163 and D363 won German IF design awards in 2006 and 2007. Multinational companies, including Canon, Siemens, Panasonic, Philips, Sanyo, Sharp and Motorola, have purchased more design projects made by Shenzhen companies in the past two years.
A batch of pioneering leaders in the industrial design industry appeared with the development of design companies. Sun Lei from Fiyta, Luo Cheng from Artop, and Wang Yongcai from Newplant were awarded as Top 10 Excellent Youth of China's design industry in 2005 and in 2006. Together with a group of innovative designers, they created designs that were well-received by overseas customers and propelled the development of the design industry. Under their leadership, design companies, willing to face the challenge from the international companies, expect more business and profits from the international market.
---Watch and clock design
Shenzhen, the biggest watch and clock manufacturing center in China, tops the world in the industry for its huge productivity. Shenzhen-made watches and clocks take up more than 60 percent of the market share in China. Shenzhen is also a leading exporter of watches and clocks with its products accounting for more than 50 percent of China's total exports. Among the nine "China Top Brands" for watches and clocks, four of them, Fiyta, Ebohr, Tianwang and Power, are Shenzhen brands.
Much of the credit of a growing market share should go to the innovation in manufacturing techniques and the establishment of brand-name products. The history of Shenzhen-made watches began in the 1980s with a quartz watch designed by Tianba. In the mid 1990s, Fiyta, Ebohr, Tianwang and Power established their names as China's top watch brands. Among the four, Ebohr and Fiyta were listed in China's top 500 valuable brands in 2004, with an estimated value of 581 million yuan and 500 million yuan each.
Now, 56 Shenzhen watch and clock companies are selling timepieces with highly-acknowledged brands in the domestic market, 140 companies own brand timepieces and 37 percent of companies in the industry own at least one patented product.
With manufacturing methods having been improved by new materials, new technology, new concept and new design, watch and clock manufacturers in Shenzhen have made impressive progress in terms of design and quality. For example, Fiyta designed and made the first space watch of China, making China the third country in the world that can make a space watch of its own, along with Switzerland and the former Soviet Union. The product is considered to have greatly enhanced China's status in the world timepiece industry. Another major player, Ebohr, boasts patented products like the scratch-proof nano-coating watches, 18 gold watches, multi-color ceramic watches and high-tech rechargeable watches. These designs have been granted "China's Enterprise New Records." Statistics show that more than 600 patented products are owned by Shenzhen watch and clock makers.
A watch design competition organized by Shenzhen Fiyta (Group) Corp. Ltd. and the Academy of Arts and Design of Qinghua University, the Fiyta Watch Design Competition, has been held three times. With the panel of judges being leading designers in the field and competitors from different parts of the world, the competition is imposing growing influence on the industry.
China Watch Jewelry & Gift Fair (CWJF), the largest timepiece show in China, has been held 18 times since its establishment in 1988. A UFI member, China Watch Jewelry & Gift Fair is one of the world's top three timepiece shows along with the World Watch, Clock and Jewelry Show in Basel and the Hong Kong Jewelry Watch Fair.
---Jewelry design
Shenzhen, known as the jewelry manufacturing center of China, is where jewelry brands Adeca, Gem, Millennium Star, Creation and Baijue are based. The prestige of the city as a jewelry center was given a boost after organizers of the Miss World competition chose a Shenzhen jewelry company to make the crowns for the quest.
Shenzhen is now home to more than 1,300 jewelry manufacturers and four wholesale jewelry markets. More than 130,000 people are involved in the industry which has an annual processing income of 80 billion yuan, contributing more than 70 percent the total income for China's jewelry industry. The trade volume of gold, platinum and diamonds in Shenzhen comprises 80 to 90 percent of the total volume of the Shanghai Gold Exchange. Their annual export volume totals US$1.2 billion. Twenty-two local brands are named "China Top Brand" and four have been named "China's Well-known Mark," almost half the total recognized jewelry brands in China. With a growing emphasis on design, Shenzhen's jewelry industry devoted much effort to making its own jewelry brands, expanding the industry to complete a chain that includes designing, processing, trading and marketing. Shenzhen's jewelry can now be found in European, U.S. and Southeastern Asian markets. In 2003, the Shuibei International Jewelry Trade Center was inaugurated, providing a market for international jewelry trade. In 2006, when the Shuibei International Jewelry Trade Center was accepted as a sub-venue of the China (Shenzhen) International Cultural Industry Fair, the jewelry industry was recognized as one of the cultural industries of Shenzhen.
The Creation Group was set up in 2000 and made its name by building the Shuibei International Jewelry Trade Center and Creation, and was awarded "China's famous brand" in 2003. The company built the Shuibei trade center into the largest of its kind in China over seven years with annual sales of more than 6 billion yuan a year. The trade center is now a hub for jewelry processing and trading, talent training and information exchange, as well as a travel destination. One of the focuses of the center is to build workshops for jewelry designers to attract top designers from home and abroad and to make the center a talent pool for the industry.
Eight international jewelry fairs have been held at Shuibei International Jewelry Trade Center recording an average trading volume of 300 million yuan each year.
---Toy design
Seventy percent of the world's toys are made in China, and Shenzhen has about 40 percent of the nation's total exports. In 2006, Shenzhen's toy exports totaled US$6.5 billion, accounting for 37 percent of the country's US$17.7-billion export total and 46 percent of Guangdong Province's US$14 billion. Shenzhen's toy exports have topped the country for several consecutive years.
As early as 1979, Shenzhen's toy manufacturing industry originated from processing given materials. By 1993, 90 percent of Hong Kong's toy manufacturers had moved to Shenzhen. By the end of the 1990s, Hong Kong toy-makers had transferred all toy manufacturing to Shenzhen, while keeping product development and sales departments in Hong Kong.
Under pressure from a lack of design and branding ability, the Shenzhen Toys Industry Association has committed to foster designing ability to improve the competitive edge. Up to now, there are more than 3,000 designers in the industry in Shenzhen.
