Taiwanese suppliers of metal-furniture-making equipment have been under mounting pressure from customers shopping for the highly efficient equipment they need to cut costs and stay competitive in world markets.

While most of Taiwan's wood-furniture producers have moved shop to mainland China, local metal-furniture makers have been able to compete at home due to the convenient access to cheap and high-quality metal in Taiwan.

In recent years, however, production costs in Taiwan have become increasingly difficult to bear for metal-furniture suppliers, forcing many to follow their counterparts in the wood-furniture sector westward across the Taiwan Strait. In order to retain those customers that remain on the island, equipment suppliers have no choice but to develop efficient models that can help local furniture makers compete with rivals in labor-cheap areas such as mainland China.

Internet Connected

Sheng Chyean Enterprise Co., Ltd. Has impressed its customers with the recent rollout of automated machines that can deliver operation data via the Internet, according to company president Huang Yu-chuan. "People can check the operation status of the machines over the web from any Internet-connected PC," he says.

Huang's company specializes in making machinery that combines wire-rod straightening and automated chamfer functions. All of the company's machines are sold to manufacturers of metal rods used by various industries, including the furniture and information-technology (IT) sectors. According to Huang, one of his company's customers supplies wire rods made with his company's machines to Hon Hai Precision Industrial, Taiwan's largest manufacturer.

Sheng Chyean's machines can straighten wire rods made of free-cut steel, stainless steel, copper and polished steel.

The company's machines are sold as whole-plant solutions designed for high-output factories. A typical machine made by the company is about 30 meters long and handles preliminary straightening, drawing, extending, final straightening, cutting and polishing. Sheng Chyean's machines can process wire rods from two to eight meters in length and 2mm to 100mm in diameter.

Huang stresses that his company's machines are highly efficient and achieve top-quality results. They can process 60 to 70 meters of wire rod a minute, he says, which is about 85% to 90% of the rate achieved by much more expensive Japanese models. Error tolerance on a one-meter bar is under 1mm.

According to Huang, Sheng Chyean can deliver machines at only one-third to one-half the price of Japanese counterparts. The company's flagship-type straightening machines are priced at around NT$8 million to NT$10 million (US$230,000 to US$290,000 at US$1:NT$35) apiece.

To guarantee the quality of its machines, Sheng Chyean adopts German or Japanese bearings and precision parts as well as Mitsubishi control units. Its five-person R&D team develops tailor-made programs for the control units to meet various customer needs, Huang says.

Sheng Chyean ships about 10 straightening systems and around 30 single-chamfer machines a year. Most are exported to mainland China and Southeast Asia, though the company has recently added Latin America, the Middle East, Turkey and South Africa to its list of overseas markets.

"Over the past two to three years, we have met half of the mainland's demand for rod-straightening machines," Huang boasts. He says that German suppliers and Japanese suppliers have intensively promoted their machines in the mainland, but have a great deal of difficulty competing with his company. "Their machines are expensive and they face language barriers in the market there," he states.

Sheng Chyean plans to open a facility in mainland China by the end of this year to better serve customers there.

Huang points out that overseas markets, particularly those in what are generally called emerging economies, have replaced the domestic market as his company's major revenue sources. "Many of Taiwan's IT manufacturers have transplanted to these economies and many of these areas are rapidly developing. Both factors have boosted demand for rod-straightening machines in those markets," he notes.

Huang claims that his company is the only Taiwanese manufacturer of combination-type wire-rod straightening machines. He points out that his industry is a niche sector due to the customized demands. "Big machine makers are not interested in the market, and small manufacturers are financially incapable of building the machines, leaving the niche to mid-sized manufacturers like us," he says.

Huang founded his company in 1994 as a manufacturer of auto-chamfer machines and a repairer of rod-straightening machines made by Japanese suppliers and German suppliers. Three years later, his company began producing straightening machines.

Labor-saving Models

Yi Tung Machinery Co., Ltd. Has also made considerable strides in developing automated machines. According to company chairman M.H. Hsieh, each of the company's whole-plant iron-wire processing lines can replace at least 10 workers.

The company's major products include automatic straight-wire cutting machines, automatic metal-wire rounding machines, automatic bar-chamfering machines and bend-forming machines. All of these models are small- to medium-sized units designed for metal-furniture manufacturers.

"Metal-furniture manufacturing has traditionally been a labor-intensive industry. So, we have been doing our best to make machines that are more efficient and automated," says Hsieh. He states that his company is developing numerically controlled (NC) machines and will begin to deliver the first models next year.

With NC machines, Hsieh notes, adjustments needed for different workpiece sizes are easier, while shortening mold-change and trial-run times by around 60%. Yi Tung will promote its NC models to furniture makers in Taiwan and Southeast Asia.

According to Hsieh, Yi Tung ships around 100 machines of various types each year. He expects his company to boost sales by 10% this year, based on the strong development of the furniture industry being experienced in Southeast Asia.

Most of the machines sold by Yi Tung are used to produce shopping carts, display racks, warehouse storage cages, corrugated storage racks, magazine racks, CD racks, dish holders, spice racks, wine racks, knife racks, pull baskets, napkin holders, cargo carriers, storage baskets, and other such items.

Automated Welding

Golden Spot Industry Inc. recently introduced several automated machines, including an auto-feed multi-point spot welder and an upright rotary-welding machine.

The company rolled out what management calls its "flagship" auto-feed multi-point spot welder early this year after three years of development. This machine, according to company chairman Huang Chin-rong, is equipped with a micro-control interface to facilitate operation.



The multi-point spot welder was developed to weave metal nets for use in storage racks. It eliminates fixed molds, which are commonly used in semi-automatic or manually operated machines to keep crossing straightened-iron rods properly positioned. Huang says that his company's machines replace the molds with servomotors that keep the rods positioned at exact right angles and feed the rods to precise welding points.

The efficient welding machine can weld 20 points in a row in only 0.6 second and finish a net in 25 seconds. "Manually operated machines require around 2.4 minutes to finish a net," Huang says. His company expects to ship around 20 of the machines by the end of this year.

Golden Spot's standard multi-point spot welder can weld up to 20 points at a time, but the company is able to produce models that can weld up to 36 points in a row simultaneously.

The company's patented multi-point welder has six unique functions, including an automatic material-feed mechanism, automatic material-positioning and automatic material-clamping. The unit also comes with an LCD display showing processing-related data and notifying operators when problems are detected.

The company's automatic upright rotary-welding machine is also equipped with a micro-control system installed with the company's self-developed software. This machine can be used for welding round containers such as thermos bottles and automobile parts. Huang says that the micro-control system ensures even welding results and can adjust the rotation speed according to the thickness of the wall of the workpiece, slowing the processing speed on thicker walls. "This makes the welded area more durable," he says.

The maximum welding diameter of the upright rotary-welding machine is 350 mm. The company has shipped 50 to 60 of the machines in each of the past few years.

Although Golden Spot unveiled its first iron wire-forming machine around 10 years ago, the model is still an efficient solution for folding iron wire into wave-like shapes. According to Huang, Golden Spot is the only Taiwanese supplier of this type of machine, which he says allows users to set form lengths and volume without stopping work. The unit can also quickly identify problems with the help of a microcomputer.

Huang says his company has spent around NT$5 million (US$145,000), or roughly 5% of his company's NT$100 million (US$2.9 million) annual revenue, developing automatic machines in each of past few years.

Golden Spot opened an office three years ago at an incubation center of the National Chin-Yi Institute of Technology in central Taiwan to develop better automation techniques.

In order to cut production costs and better serve its mainland Chinese customers, Golden Spot opened a facility in Jiangsu Province one-and-a-half years ago. Today, the Jiangsu factory represents around 60% of the company's total output, with many of the machines sold to the growing number of Taiwanese metal-furniture makers based in the mainland.

Golden Spot's main factory in Taiwan, which accounts for the remaining 40% of the company's total output, has been shifting its market emphasis from mainland China to Southeast Asia since the beginning of the second quarter this year in order to avoid the "3C" certification system implemented by the mainland authorities in August this year. "The system will make it harder to ship machinery to the mainland. So, we decided to turn away from the mainland market," Huang explains.

Despite a 60% drop in business during the first half due to the SARS (severe acute respiratory syndrome) outbreak, Huang expects his company's 2003 revenue to stay on par with last year's level. "Fortunately, our order volume has recovered since late in the second quarter after the SARS fear receded," he says.

Founded around 26 years ago, the ISO9001-certified Golden Spot is Taiwan's biggest supplier of equipment for welding metal nets used on storage racks, with an estimated 80% share of the Taiwan and mainland Chinese markets combined, according to Huang.

Transferring to New Markets

One of the most innovative metal machinery developers in Taiwan is Refine Coating Industrial Co., Ltd., which early this year unveiled a new thermal-transfer printing system.

According to company chairman Lai Sung-li, the thermal transfer system is the first of its kind to be developed in Taiwan. It will also help the company shift its focus away from the intensely competitive market for electrostatic powder and liquid paint coating whole-plant machines, which have been the mainstay products of Refine Coating since its establishment eight years ago.

The new machine prints patterns or grains on metal sheets, metal tubes and metal boards through thermal transfer methods. "This system brings life to lifeless metal parts by coating them with vivid patterns or grains," Lai notes.

Lai's company develops some special printing ink that allows patterns and grains to deeply penetrate into the printing layers, making the coatings more resistant to fire, humidity and weather damage.

Lai says that thermal-transfer printing machines have long been used to process building materials. Refine Coating has made some modifications to such machines so they can be used for finishing metal furniture as well. Refine Coating has applied for patents on the machine, which his company spent around NT$10 million (US$290,000) to develop.

This machine prints metal parts that are already treated by the company's electrostatic powder system or liquid paint coating system. Lai says that this new machine has received very positive remarks from furniture manufacturers. "Nevertheless, they feel this system is too expensive for them. We are still trying to lower the price of these models from the current NT$6 million to NT$7 million (US$170,000 to US$200,000)," Lai notes.

Although Refine Coating opened a factory in mainland China around seven years ago, the company has no plans to build thermal transfer models there, due to concerns over copycat makers. The mainland factory now makes electrostatic powder and liquid paint coating systems largely for sale to transplanted Taiwanese companies there.

Another innovative machine made by Refine Coating is the RA600 powder recovery system. The RA600 has a patented powder reclaim container, which can be opened to clean before loading different powders. Lai says that the reclaim containers used on rival products lack this function and therefore can only be used with powder of the same color, increasing operation costs. Lai also claims that the RA600 can collect 99.9% of the powder that fails to adhere to work pieces.

Next year, Refined Coating plans to roll out electrostatic powder equipment for wooden products.

Lai says that innovative design, product durability and after-sales service are the key elements sought by customers from equipment suppliers. Refine Coating has opened a sales offices in Vietnam and northern mainland China to provide strong service support, and the company's machines can run at least 10 years, Lai says.

Refine Coating's biggest machine is an 800-some meter long unit that can process work pieces at a rate of 14 meters per minute.

Refine Coating sells about 10 machine lines each year, generating revenue of about NT$100 million (US$2.8 million). The company has a backlog of orders stretching through the end of the year, leading Lai to forecast his company will post a major revenue increase this year.