Many people will find an interesting phenomenon when they go shopping: milk tea shops and Internet celebrity restaurants have been replaced one after another, while the hardware store at the entrance of the community is always crowded, but it has been able to take root steadily for more than ten years and can be called an evergreen tree on the street.
Few people know that these seemingly inconspicuous businesses of screws, water pipes, and small tools have been turned into a 100-billion-dollar industry by a group of Zhejiang businessmen. They have also made Yongkang, known as “China’s Little Dubai,” popular, making it the most low-key place to hide wealth in Zhejiang.
It looks like there is no customer flow, but it is the most stable business on the street
Many people subjectively feel that the hardware store has no customers and cannot make money, but in fact it is completely misled by the visual illusion.
Ordinary people don’t just visit hardware stores for free. Most of the people who come into the store are those who just need to make purchases, and the transaction rate is far higher than that of clothing stores and restaurants.
Retail retail accounts for only 10 to 20% of total revenue.
Residents usually buy trivial businesses such as light bulbs, glue, and faucets as supplementary income.
What really supports store profits are long-term B-end customers such as decoration foremans, property companies, small processing plants, and engineering construction teams. Such orders can account for more than 80% of the hardware store’s total revenue.
Bulk purchases of wires and pipes for decoration, daily maintenance and stocking of properties, and long-term consumption of screw accessories in factories. The amount of an order can range from a few thousand to tens of thousands. Stable cooperation and continuous payment collection are a stable source of cash flow for the hardware store.
In emergencies and urgent needs, it is difficult for e-commerce companies to steal business.
In the middle of the night at home, water pipes burst, circuits tripped, and door locks were damaged. Accessories purchased online would arrive as soon as the next day, and water from a distance could not quench the thirst of those near and far.
The advantage of hardware stores is that they can get the goods immediately and use them when needed. This kind of immediacy is the core advantage that online e-commerce cannot replace, and it is also the key reason why hardware stores have strong risk resistance.
Included value-added maintenance can quietly increase overall profits.
Most hardware store owners know how to repair water and electricity, and disassemble and assemble doors and windows. They sell accessories and carry out on-site construction work. The profit from labor costs is much higher than the price difference of the goods.
Many stores do not make money by selling goods. Maintenance and installation services are the main hidden profit sources. It is difficult to close down if the business continues.
The total number of retail hardware stores in the country is close to one million, and the store survival rate is much higher than that of popular formats such as Internet celebrity catering and boutique retail. The collection of scattered small stores across the country is a huge hardware consumer market, and it also lays the foundation for Zhejiang merchants to lay out the entire industrial chain.
Yongkang, Zhejiang: A small town without minerals, relying on hardware to create an industry worth hundreds of billions
Outsiders only see scattered hardware shops on the streets. Zhejiang merchants have already opened up a complete chain from production, wholesale, foreign trade to terminal retail. Yongkang, Zhejiang, is the core base of the entire domestic hardware industry and the source of this business worth hundreds of billions.
This county-level city with a permanent population of less than one million has no local mineral resources such as iron ore or copper. Instead, it relied on generations of Zhejiang merchants to cultivate the craft of blacksmithing and became a globally recognized hardware capital of China.
Official public data shows that in 2024, Yongkang’s total industrial output value above designated size will reach 104.8 billion yuan, and the annual output value of the hardware industry will officially exceed 100 billion yuan, accounting for more than 90% of the city’s total industrial output value and contributing more than 80% to local GDP.
How hard-core the industrial strength is, several sets of data make it clear at a glance:
- One out of every three thermos cups in the world is produced in Yongkang, with annual output exceeding 600 million pieces;
- 80% of fascial guns and nearly 70% of security doors on the market come from here;
- Electricity
The production capacity of power tools ranks first in the country, and it is one of the top three power tools in the world with Germany and Japan. The annual export volume of power tools exceeds 3 billion US dollars, accounting for one-third of the country’s total exports; - The city has gathered more than 30,000 hardware-related companies. Almost one out of ten Yongkang locals is engaged in hardware-related industries, truly “all employees are hardware workers.”
The complete industrial chain is Yongkang’s greatest confidence. From a small screw and nut to a complete set of security doors and a complete set of power tools, the entire process of raw material processing, parts matching, finished product assembly, packaging and delivery can be completed locally. The upstream and downstream supporting facilities are complete, and the production cost and delivery speed are full of advantages. Most hardware wholesalers across the country purchase goods from Yongkang all year round.
“China’s Little Dubai”, Zhejiang businessmen go overseas to make global money
The reason why Yongkang is called “Zhejiang’s number one rich county” and “China’s Little Dubai” is not only the local production capacity of 100 billion, but also the fact that Zhejiang businessmen have gone abroad early and spread the hardware business to the global market. The wealth is low-key and solid.
The density of luxury cars is high, and the property of private wealth is prominent.
Yongkang has a mediocre urban appearance and looks like an ordinary small town, but its private purchasing power is astonishing. It has long been ranked first in the country in terms of density of luxury cars at the county level, and its per capita disposable income has consistently led the counties in central Zhejiang.
Many bosses look plainly dressed, holding factories and foreign trade orders in their hands. There are many hardware practitioners with net worth of tens or even hundreds of millions. Getting rich in a low-key manner is a typical characteristic of Zhejiang businessmen.
There are 12 local enterprises with tax payment of more than 100 million yuan, and as many as 60 enterprises with tax payment of more than 20 million yuan. Most of the revenue comes from the hardware industry chain, and the wealth foundation is solid and stable.
The factory is in Yongkang, stores are open all over the world, and cross-border layout is everywhere.
As early as many years ago, Yongkang Zhejiang merchants no longer limited themselves to domestic inroads, but concentrated on Southeast Asia, the Middle East, Central Asia, Europe and the United States, forming a model of “headquarters in Yongkang and spreading overseas channels”.
Many street hardware stores in Vietnam, Thailand, and Malaysia are run by local people. More than 90% of the goods on the shelves come from Yongkang factories. Overseas dealers purchase goods in batches, redistribute and retail them, and continuously deliver foreign trade orders to Yongkang.
Yongkang’s foreign trade performance in 2025 is very impressive: the total import and export volume in the first half of the year was 25.997 billion yuan, a year-on-year increase of 6.51%; the overseas investment volume for the whole year reached 510 million US dollars, a year-on-year increase of 511.38%, and more than 60% of overseas funds were invested in the Southeast Asian market, relying on RCEP dividends to continue to expand global market share.
Many leading hardware companies have directly built factories overseas to avoid trade barriers and get closer to the end market. For example, the overseas base revenue of Hals thermos cups has exceeded 90%, becoming the core engine of corporate growth; local magnetic materials companies have invested one billion baht in building smart chemical factories in Thailand, further stabilizing their voice in overseas supply chains.
With both online and offline efforts, the domestic sales market has steadily expanded.
In addition to foreign trade, Yongkang Hardware has simultaneously reaped the benefits of domestic e-commerce. The number of Taobao villages ranks among the top counties in the country. A large number of Zhejiang merchants have transformed into cross-border e-commerce businesses such as Pinduoduo, Douyin, and Amazon, directly connecting consumers from factories and cutting out the price differences between middlemen.
Relying on Yiwu’s business flow radiation and Ningbo-Zhoushan Port’s overseas advantages, domestic wholesale sales, retail e-commerce, and cross-border exports are simultaneously developed. The 100-billion-dollar industry is getting bigger and bigger. Even if the market fluctuates, the ability to resist risks is still far better than that of a single industry.
An inconspicuous small business hides the great wisdom of Zhejiang merchants in long-term business operations
Many young people are obsessed with chasing Internet celebrities and huge profit projects, and dislike the cumbersome and trivial hardware business with meager profits. On the other hand, Zhejiang merchants have devoted themselves to traditional industries for decades and turned small hardware into a world-class industrial cluster. The business thinking behind it is worthy of careful consideration.
Don’t chase short-term trends, but delve deeply into the long-term track that is just needed.
Milk tea, catering, and Internet celebrity products are iterating very fast, and the trend has faded away, and a large number of practitioners have left the market at a loss; hardware is in urgent need of society, and decoration, infrastructure, maintenance, and manufacturing can never be separated from related accessories. The demand is stable all year round and will not be easily eliminated by the times. Slow business is easier to maintain for a long time.
Build an industrial chain as a team rather than go it alone.
Zhejiang merchants are best at developing together. In Yongkang, there are no merchants who maliciously lower prices and get involved. There is a clear division of labor between upstream and downstream. Some people make raw materials, some make parts, some make finished products, and some do wholesale foreign trade. Everyone works together to expand the scale of the entire industry and collectively seize the right to speak in the global market to achieve a win-win situation.
You can lower your profile, earn a little money and build long-term reputation.
Whether they are the owner of a small hardware store on the street or the owner of a multi-million-scale factory, Zhejiang businessmen are generally able to endure hardships and are willing to work hard. They do not mind the meager profit of a single product. They are willing to make a difference of a few cents per order. By accumulating customers and reputation over a long period of time, they can slowly turn a small business into a big business.
Be prepared for danger in times of peace and proactively seek changes to avoid involution.
At present, the competition in the traditional manufacturing industry is fierce. Yongkang does not stick to the old path of low-end processing. It continues to upgrade to intelligence and high-end, and develops high-end power tools, high-end stainless steel utensils, and smart door products. At the same time, it takes the initiative to go overseas to open up new markets. It does not rely on low prices to compete with others. It uses product iteration to stabilize profit margins, which is in line with the high-quality development direction of the real economy.
Big opportunities often lie hidden in small industries.
We always pursue the glamorous and popular industries, and subconsciously despise the humble traditional small businesses. The story of Yongkang’s 100 billion hardware industry just proves: there is no low-end industry, only impetuous work mentality.
A screw, a water pipe, and a small tool are enough for generations of Zhejiang businessmen to work hard for half a lifetime, from a small street shop to a global business; on the other hand, many entrepreneurs who follow the trend and chase the trend, have been struggling back and forth, but it is difficult to accumulate results.
Being pragmatic and plowing into the market that is just in demand, cultivating the industrial chain, and pursuing long-term management steadily are reliable and feasible ways to get rich no matter what the era.
If you pass by a deserted hardware store in the future, you might as well look at it from a different perspective: it is not just an inconspicuous small store, but also the smallest microcosm of the hundreds of billions of hardware industry extending into the market. It is also the most intuitive embodiment of the down-to-earth, low-key and pragmatic business spirit of Zhejiang merchants.
