SZ hub in­no­vates to sur­vive

Huaqiang North rides out e-com­merce chal­lenge by in­te­grat­ing re­sources

China Daily (Hong Kong) - - BUSINESS - By ZHOU MO in Shen­zhen sally@chi­nadai­

Wang Laobao is a sur­vivor who thrived. Once a ven­dor sell­ing elec­tronic prod­ucts in Shen­zhen’s Huaqiang North, he be­came chair­man of e-com­merce plat­form

He suc­ceeded, though, at a time when many other busi­ness­men in the area were strug­gling to find a niche.

“From in­ter­na­tion­al­iza­tion to dig­i­tal­iza­tion, I al­ways made changes quickly ac­cord­ing to the mar­ket,” he said.

Known as the coun­try’s big­gest trad­ing hub for elec­tronic com­po­nents and de­vices, Huaqiang North has seen rapid growth over the past decades.

Ac­cord­ing to lo­cal me­dia re­ports, it ranked as the coun­try’s top mar­ket in scale and sales of elec­tronic prod­ucts in 2008. The de­vel­op­ment has largely been based on sell­ing low-price copy­cat prod­ucts — re­gard­less of in­tel­lec­tual property rights.

How­ever, the emer­gence of e-com­merce in re­cent years has dealt a heavy blow to traders in the area, where hun­dreds or thou­sands of bricks-and-mor­tar busi­nesses are lo­cated. It is now striv­ing to trans­form and up­grade through in­no­va­tion.

Ex­perts and busi­ness lead­ers say there are large gaps in the in­ter­na­tional mar­ket for busi­nesses in Huaqiang North to ex­plore, but they need to in­no­vate in a way that can give full play to their ad­van­tages.

In­stead of fol­low­ing the US and Europe’s steps to de­velop high-end prod­ucts, they can in­te­grate ex­ist­ing re­sources to sat­isfy the de­mand of cus­tomers from de­vel­op­ing coun­tries, said Qu Jian, vice-pres­i­dent of the China De­vel­op­ment In­sti­tute, a Shen­zhen-based think tank.

... up­grad­ing of Huaqiang North not only re­quires busi­nesses to ‘go out’, but also ... ‘ bring in’ in­ter­na­tional re­sources.” Li Shucheng, pres­i­dent of Shen­zhen Huaqiang Hold­ings Ltd

“In­te­gra­tion of re­sources is a form of in­no­va­tion. En­ter­prises in Huaqiang North can make great achieve­ments in In­dian or African mar­kets through this way. The key is to de­velop prod­ucts that meet true de­mand from those coun­tries and re­gions,” he told Huaqiang North Trans­for­ma­tion and Up­grad­ing In­ter­na­tional Sum­mit Fo­rum held in Shen­zhen in Novem­ber.

In re­cent years, many en­ter­prises in Huaqiang North have tried to in­crease their pres­ence in over­seas mar­kets. Now, they are also striv­ing to bring in­ter­na­tional el­e­ments to the area as a way of pro­mot­ing in­no­va­tion.

Shen­zhen Huaqiang Hold­ings Ltd is an ex­am­ple.

“We have been de­vel­op­ing in­ter­na­tional mar­kets in a wide range of fields,” com­pany pres­i­dent Li Shucheng said. For ex­am­ple, a theme park built by the com­pany has al­ready started op­er­a­tions in Iran. It has also ex­ported its car­toon prod­ucts to over 100 coun­tries and re­gions.

A startup in­cu­ba­tor — the Huaqiang North In­ter­na­tional Maker Cen­ter — was set up by the com­pany with the aim of help­ing star­tups and in­no­va­tors from across the world to turn their in­no­va­tive ideas into re­al­ity.

“Suc­cess­ful trans­for­ma­tion and up­grad­ing of Huaqiang North not only re­quires busi­nesses to ‘go out’, but also re­quires them to ‘bring in’ in­ter­na­tional re­sources,” Li said.


A cell­phone ven­dor at a store in Huaqiang North in Shen­zhen, Guang­dong prov­ince.

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