In European and American homes, a whole wall of neatly stacked tools such as wrenches, pliers, screwdrivers, tool boxes, etc. is often hung in the garage.
Repairing things by yourself and doing carpentry work are a common way of life for Europeans and Americans.
Many of these tools are produced in Chinese factories, among which Hangzhou’s Superstar Technology is particularly prominent.
The tool business is huge in the European and American markets. The DIY lifestyle makes every household and professional workers inseparable from tools. North America and Europe are the main regions for global tool consumption.
However, in the past, the brands and channels of the tool industry were firmly controlled by European and American manufacturers, and Chinese tool factories could only engage in OEM business for a long time.
Take Superstar Technology as an example. It first takes OEM manufacturing to the extreme.
Relying on China’s mature hardware tool industry belt in the Yangtze River Delta, from steel, molds, heat treatment to electroplating, assembly and other links, Superstar can manufacture tools at a cost and speed that European and American manufacturers cannot match, making European and American hypermarkets dependent on it.
This laid a solid foundation for its subsequent development.
More importantly, Superstar Technology has moved from “doing it for others” to “doing it yourself.”
While it is building its own overseas sales channels, it is also conducting large-scale mergers and acquisitions around the world, acquiring overseas tool brands with history and reputation, and adding its own cultivated brands to build its own brand matrix.
Today, its own brand revenue accounts for nearly half, and it has begun to directly face European and American consumers.
Superstar Technology’s M&A strategy is very wise. By acquiring old brands with decades or hundreds of years of history in Europe and the United States, it has overcome the long process of building a brand from scratch, and combined with the cost advantage of China’s supply chain has formed strong competitiveness.
At present, Superstar Technology has become the third largest hand tool industry in the world and the first in Asia. Its products have not only entered European and American hypermarkets, but also entered the garages of countless ordinary families.
Moreover, it is also expanding into the field of power tools with higher technical content and profit, and has won long-term purchase orders for power tools from thousands of stores in North America.
However, Superstar Technology still faces challenges.
Although it has become the third largest company in the world, compared with the industry leader Stanley Black & Decker of the United States, there is still a gap in scale, brand recognition, and channel foundation.
Although private brands account for nearly half, half of the business is OEM. From “half OEM” to “brand-oriented”, and for European and American consumers to truly recognize the brand, it will take time and the accumulation of word-of-mouth.
Looking at the broader context, Superstar Technology is not fighting alone. A group of Chinese tool companies are collectively marching towards European and American shelves, and gradually climbing upstream brands and channels through the cost advantage of China’s supply chain. This is called “the global replacement of Chinese brands” by research institutions.
Tool manufacturing is no longer a problem for Chinese factories, but it will take a long time for European and American consumers to actively choose Chinese brands.
The development history of Superstar Technology is the epitome of the upgrading of China’s manufacturing, from OEM for others to grabbing more valuable positions in the upstream of the industrial chain. Once it is successful, “Made in China” will truly become a “Chinese brand”.
