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Mon, May 27, 2002 - Page 18 News List

Premier Image provides a snapshot look at making it in China

Cliff Liu, president of Premier Image Technology Corp, a company that typifies how the Taiwanese are doing business -- and succeeding at it -- in China, spoke with `Taipei Times' staff reporter Dan Nystedt about how his firm is moving from manufacturing traditional cameras to becoming a powerhouse in digital cameras


Premier Image Corp president Cliff Liu says his company's new 15,000-ping building is proof of its determination to keep its roots in Taiwan despite its growing success in the China market.


Taipei Times: Premier Image Technology Corp (普立爾科技) was included in Merrill Lynch's Asia-Pacific Technology Forum as a rising star. Could you say how much of your business is in digital cameras and how much in traditional?

Cliff Liu (劉燈桂): Last year, digital cameras made up around 32 percent (of sales) and compact cameras were 55 percent and we have some other products, around 2 or 3 percent. The digital camera this year, we believe, will be over 50 percent (of sales) and we still see the trend in the digital cameras continuing.

Last year, a lot of people said our digital camera sales this year would grow 15 percent, and if they were very aggressive, maybe 20 to 25 percent growth. Up to the first three months of this year, people have become more optimistic and revised up their growth. I am also more optimistic. I believe we will attain a growth rate of 25 percent or 30 percent in digital camera sales.

You can see the results from our first quarter calculations, over 30 percent growth over last year and in April, we had 70 percent growth over last year. We still see digital cameras becoming more popular in the market.

TT: Of the cameras you make, are they contract manufactured for other customers or are any marketed under the Premier brand name?

Liu: Actually, we do very good business on ODM, original design manufacturing (design and manufacture for customers). About 57 percent of our sales are ODM and around 20 percent are sold on an OEM (original equipment manufacturer) basis. Our own brand makes up over 20 percent of sales.

Actually, Premier strongly promotes Premier brand products in a lot of developing markets -- Taiwan, China, India, the Middle East, Russia and Latin America -- because in developing countries, most people buy a little bit more in the lower end (of the market) and the branded products concentrate much more on developed markets -- Japan, the United States, Europe -- and in those areas we will not promote any Premier brand at all.

But in China we are doing very well. In China we have set up over 29 branch offices and we have over 400 exclusive contracts to sell cameras in department stores in major cities and we have over 4,000 agents all over China selling Premier cameras. As we all saw, last year the Chinese computer market grew very quickly and a lot of people, including Taiwanese manufacturers and Chinese distributors, also bought digital cameras from us. So, we promoted our digital cameras mostly in Taiwan ,China and other developing countries. You can easily find Premier cameras in Taiwan's department stores and photo shops.

TT: What kinds of returns are you seeing in China? How much of your sales will China make up this year?

Liu: I cannot tell you that. But one thing I want to emphasize is that it is very easy to sell cameras in China -- many people want to buy cameras. The most difficult thing is collecting the money.

In China, most distributors look like they are willing to buy -- but they are not willing to pay. We have over 4,000 sales agents in China and a lot of sales managers from Taiwan, who will travel throughout China to determine if the distributor will pay. They look to see if the payments are on track or not. If it looks like they (the distributors) are unwilling to pay, without any other considerations we have to bring all those cameras back to our branch office. So maintaining control over accounts receivable is very important in China.

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