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How a county seized global lead in home appliances

By Wang Songsong| chinadaily.com.cn| Updated: October 16, 2023 L M S

After decades of development, Cixi county in Ningbo, Zhejiang province, has become a home appliance giant that produces 60 percent of all appliances globally.

Starting from the mid-1980s, the small household appliance industry in Cixi began by supporting the production of companies from other regions. Yu Xuehui, general manager of a local home appliance company, told the paper Securities Times that Cixi mainly took overflow orders from the main industry in Shanghai at that time. The manufacture of certain appliances, such as electric fans, which were not receiving much attention in Shanghai, gradually spilled over into neighboring cities.

"Many people in Shanghai have relatives or friends from Ningbo, and they saw them doing this type of business, so they started as well," Yu said.

To solve technical problems, Cixi invited engineers from Shanghai — known as the Shanghai Sunday Engineers — to guide product development. And the small household appliance industry in Cixi took off.

After the 1990s, and especially since 2000, Cixi's household appliance companies entered a second wave of rapid development. They evolved from supporting other regions into a complete manufacturing base.

Yu Xuehui said that during this stage, Cixi obtained samples and orders from Guangdong and other places. The business model also shifted from a focus on the domestic market to prioritizing foreign trade exports with government encouragement.

Based on these two waves of development, Cixi has gradually become one of China's three major household appliance manufacturing bases (the other two are Qingdao in Shandong province and the Shunde district of Foshan, Guangdong). It has formed a mature industrial chain.

The household appliance industry is currently the largest pillar industry in Cixi. There are more than 2,000 household appliance manufacturers and nearly 10,000 supporting enterprises, with products covering more than 20 series and thousands of varieties.

In the small household appliance industry, there are several national "single champions" in areas such as electric irons, heaters and hair dryers. The county's annual output of electric irons exceeds 60 million units, accounting for over 60 percent of the national export volume; the annual output of heaters exceeds 25 million units, accounting for over 30 percent of the national total.

The success of Cixi' is closely associated with its developed private economy.

"It is not only an economic advantage of Zhejiang but also an advantage for Cixi's home appliance companies," said Lu Ping, chief financial officer of Zhejiang Yueli Electrical Co. "Virtually all home appliance companies in Cixi are private enterprises. They are sensitive to market needs and have a short product development cycle, high management efficiency and strict control over manufacturing costs."

In this economic development context, Cixi's small home appliances have a low cost, high performance ratio and a wide range of product categories. Except for a few Chinese small home appliance products (televisions, microwave ovens, induction cookers, rice cookers and electric pressure cookers), Cixi produces almost all other products, making the product categories relatively diverse.

"In Cixi, if you want to manufacture a small home appliance, within half an hour, you can find at least 99 percent of the components. Only chip companies may not be available. Within half an hour, you can still find multiple manufacturers for each component, ensuring complete supporting facilities and creating an agglomeration effect," Yu said.

In the first quarter of 2023, local customs data show that the export value of washing machines reached 210 million yuan ($28.74million), an increase of 51.3 percent year-on-year. And the export value of refrigerators and freezers was 480 million yuan, an increase of 3.4 percent year-on-year, China Central Television reported in May.