Hi-Link has been a reputed supplier of Wi-Fi, Zigbee, GPS, Bluetooth and other wireless modules for years. In conversation with Electronics Bazaar, the company’s CEO, Jacky Gong, talks about the importance of the Indian market for the future growth of the company.
EB: What are the major sectors that are driving growth in China’s electronics industry?
Currently, China’s economic growth has slowed down while labour costs have increased substantially. In the Tier-1 cities in China, some labour-intensive manufacturing enterprises are gradually moving to the Tier-2 or Tier-3 cities. The cost is high in the smaller cities too, which in turn is forcing them to switch to intelligent production lines like using robotic arms to replace manual labour. These kinds of industrial electronics enterprises have been gradually growing in China, and the government is also actively promoting them.
EB: How important is India in the electronics industry value chain/supply chain of China?
India is an emerging market and has great prospects. First of all, India is a populous country; second, India’s software is quite advanced compared to China. Its software development skills are close to the world’s most advanced levels.
In the industrial electronics industry chain, India can keep pace with China in various sectors like software design, hardware development, etc, and can occupy a considerable part of the chain.
EB: What is more important for you—domestic sales in China or exports? What percentage of your overall revenue last year did exports account for?
We mainly provide embedded Wi-Fi modules and solutions for the Internet of Things and the intelligent household industries. Our modules are mainly used in some smart single products. Sixty per cent of our sales come from domestic sources, but from that customer base, 60 per cent of the companies are export-oriented. So, in that sense, almost all of our products are used in exports. The concept of the Internet of Things in China has become very hot in recent years, but there have not been too many breakthrough products, as yet, in this domain. The market is still in the trial and error stage at the moment. But the Internet of Things trend is on the rise.
EB: What are the top countries that you export to?
We mainly export to countries like the United States, Europe, India and Vietnam. America has always been an important consumer, so the proportion of our exports there is relatively large. For us, India is an emerging market with exports increasing each year, so we eagerly look forward to increasing our business in this market. We want more enterprises to know about us and use our products.
EB: How important do you think India is for the future growth of your business?
India’s GDP is growing rapidly each year. The market demand is very strong, and the people of India are full of wisdom, a lot of energy and creativity. We believe India will be a very important market for our overseas sales. We will also increase our investments in the Indian market in the future.
EB: Are you already doing any business with India?
Yes, our product is already used by some companies in India. Our UART Wi-Fi module and tiny power module are very popular in the Indian market.
EB: Do you have distributors/agents in India or are you supplying directly?
We tend to find domestic Indian agents, because they are more aware of the Indian market conditions and know how to promote the products. Our agent in India at present is Rajguru Electronics, which does the marketing with us.
EB: What are the biggest challenges for you when growing your business in India?
For us, the Indian market is very challenging. The biggest difficulty for us is how to quickly open and spread our sales channels. We need to be familiar with the channels and means of production. There are a number of Indian companies offering products that are on par with our products. To compete with them is a relatively big challenge.
EB: For your products or services, who is more important—the technical decision-maker or the commercial decision-maker?
Our company is positioned as an IoT Wi-Fi industry leader, mainly based on our technology. So the role of technology within our company is relatively large. Given that, it’s probably the technical decision-maker who will play a bigger role. It has been our philosophy to make our products more convenient and easy-to-use for our customers so that they can quickly build the new products that they aim to.
EB: How do you promote your products? What is your marketing strategy?
At present we mostly use online promotion as well as offline agents. For some particularly important market, we may set up branches. However, later, we will increase our R&D investments to ensure we are technically ahead of the competition and wait for the market to recognise our products’ advanced capabilities.
