Facing All Kinds of Challenges! How Can the Hand Tool Industry Break Through?
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Facing All Kinds of Challenges! How Can the Hand Tool Industry Break Through?

Taiwan's hand tool industry is well-known in the world and once created the title of the screw kingdom. At present, the hand tool industry is faced with the challenges of the international situation, lack of manpower, exchange rate and other factors, coupled with the rise of emerging countries and the same industry in mainland China, what should they do to deal with the chaotic situation?
Published: Oct 11, 2022
Facing All Kinds of Challenges! How Can the Hand Tool Industry Break Through?

Hand Tools Face Challenges

2021 is coming to an end, and it will be another challenging year for the tool industry. There is a shortage of materials, cabinets, and labor. At the same time, the cost of steel and plastic raw materials has risen sharply. In addition to exchange losses, there are many foreign migrant workers in the short term. The inability to enter Taiwan and the lack of human resources have also exacerbated the plight of the industry, and these conditions may continue until 2022. Excessive price increases may affect the cooperative relationship of traders. Taking too many orders may be affected by raw materials or exchange rate prices. It is not easy to solve in the short term.

Data Integration Is a Key Step for Hand Tool Manufacturers

Since the production of hand tools and metal products relies on a large number of processing processes, they used to be highly labor-intensive industries. 95% of Taiwan's hand tool manufacturers are small and medium-sized enterprises. In recent years, facing the challenges of low birthrate, low-volume and diversified production, high-quality precision manufacturing, and even competition from emerging countries, the industry has really thought about a way to transform, using digital tools to improve the response speed of the industry, and combining digital machinery and automation equipment to improve work efficiency and decision quality.

For example, as far as socket wrench manufacturers are concerned, due to the variety of socket wrenches, the long processing procedures, and the high proportion of industry outsourcing, most of the processing procedures are manually input to make documents. The station data, which can be improved through analysis software, is mostly helpful for the industry to improve the operational efficiency.

Alliance Collaboration Is a Must

At present, there are more than 700 hand tool manufacturers in Taiwan, and if you add third-party manufacturers, there are more than 2,000. It is a typical division of labor and settlement. The issues of fragmented supply chain and regional manufacturing also bring considerable challenges to the industry, and let’s not mention the number first. The lack of talents and IT talents also casts a shadow over the transformation of the owners. Therefore, the way of alliance fighting should be possible for hand tool manufacturers. Faced with the challenges of emerging countries and mainland China, Taiwanese hand tool manufacturers can combine government resources and service providers to jointly deal with it, so that the annual output value of more than 100 billion is created, which is the world's first. The industries of the two largest exporters continued to ride the waves.

Taiwan is a major hand tool manufacturing country in the world. More than 70% of the manufacturers gather in the middle area of Taiwan. It is the only and most complete industrial settlement in the world, allowing international buyers to buy all at once. These rarely exposed hand tool “companies” will rush to the third place in the world in terms of export value in 2020. The special processing system has laid the cornerstone of the "undefeated" hand tool industry, cultivated many low-key invisible champions, and made Taiwan famous in the world.

Taiwan has a complete local industrial chain and overseas channels, as well as upstream steel products such as Sinosteel and Fengxing, as well as forging, heat treatment and electroplating, etc., allowing Taiwan to manufacture medium and high-end hand tools and sell them all over the world.

Taiwan climbed to the roof of the global hand tools in 1998, winning the championship in export value for five consecutive years. However, in 2003, with the advantage of low wage cost, mainland China surpassed Taiwan and became the world's largest exporter of hand tools.

In fact, hand tools are almost an industry that will never disappear. 99% of products made of parts are assembled by screws. Where there are screws, hand tools are needed. Taiwan's output value is expected to reach 140 billion yuan in 2021. As long as we continue to innovate and develop, there are still more than ten years of advantages.

Published by Oct 11, 2022 Source :ivendor, Source :gvm

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