The winner of the MVP award of D&B Top1000 Mid and Small and Medium Enterprise, Jonnesway, the company has chosen one of the hardest ways to go 35 years ago, insisting on developing own brand.
JONNESWAY President Joseph Liao
President Joseph Liao said “If we only being an OEM manufacture supplier, but not have the own brand product, we can’t control the future and just follow branding companies.” Today, Jonnesway is distributed in 108 countries with solid position in professional automotive repair market; moreover, Jonnesway is No.1 market share in many countries to win the market affirmation and take back own leading role in market!
President Liao said that in the past, most of Taiwan’s export products were OEM supply, the main business model is the trader engaged in purchasing and agent to earn commission, usually only to sell large amount of goods, but not the quality, nor after-sales service, the maintenance of the customer relationship is very weak, regardless of the previous cooperation with the customer for long time, as long as other competitors offer lower prices, the order will be moved by customers to other suppliers. The competitors cut their own prices to rob customer’s orders, the market became Red Sea competition.
Even there were more than 100 containers shipped in a year, but there was no profit, only the foreign brand companies can obtain commercial sales of profits, we only rely on these big branding companies to survive.
When offered price is cheap, there are many orders and the production capacity is not enough to fulfill with customer demand. If failed in price competition, customers transfer orders to competitors, resulting in difficulty to survive, and even the company closed down. “OEM suppliers can’t dominate own market strategy and product pricing, and the fate is always in the hands of others.”
President Joseph Liao recalls that 35 years ago, when Taiwanese manufacturers faced the difficult situation of market saturation and unprofitable business, many people moved their companies and factories to China or other countries with lower production cost, but after the careful evaluation, President Joseph Liao found that most of the manufacturers or companies that moved to China or Southeast Asia were still running the DIY market, still in the pursuit of cheap products, it was the same situation of the price killing, suffering in Red Sea competition, just the competition location change of manufacturing, but also in the pursuit of price competition strategy. Therefore, President Joseph Liao decided to stay in Taiwan continuously and take advantage of Taiwan has more than 30 years of experience of manufacturing and service in the industry to develop high quality product. Jonnesway targets at professional and industrial market to upgrade product quality and features to get out of this predicament to make own product visibility in the market.
President Joseph Liao said the first difficulty was the stereotype of foreign clients about Made in Taiwan poor quality image. Most customers still think that Taiwanese-made products are cheap bargains, so it took more than 10 years to establish customers’ confidence in the product of Taiwan.
President Joseph Liao said the successful strategy for worldwide markets is to “surround the city from the countryside”, starting with the third-tier war zone and then into the first-tier war zone. At first, he was analyzing, if he wanted to start a new brand from a tier-one war zone, this will be very difficult, because the big brand originally in the tier-one war zone has the largest market share, so President Joseph Liao chose to start from South America- Chile, it is already 27 years partnership till today. The third generation of the customers in Chile are take in charge of their family business and continue to work with Jonnesway to have high market share growth.
With the success of the initial experience in Chilean market, Jonnesway speeds up market development to duplicate these experiences to other countries, and President Joseph Liao says the biggest market in Russia and Eastern Europe, where it has a 35% market share in Russia and 40% in Poland.
JONNESWAY offers professional and industrial-grade complete tool solutions and assigns tool brands to domestic and international technical competitions.
Now China and the United States are fighting a trade war, the global economy has been affected by the downturn, it generated the impact to many countries’ industries. “This is a crisis in Taiwan, but it is also an opportunity,” President Joseph Liao said. Taiwan is the kingdom of high-quality tools manufacturing in the world, if we can grasp the opportunity, it is great chance to replace the big brands from Europe and the United States.
President Joseph Liao also emphasizes that the next 30 years of Jonnesway development blueprint has been planned. In the vertical direction, the company will be towards the industrial level and aircraft maintenance market aggressively, and then through the experience accumulation for tool quality upgrading to provide customized solution kit to service high end market and meet the requirements of customers. The other part, in the horizontal direction, Jonnesway will be extended service field to other industrial markets, such as shipbuilding, mining, electronics, furniture, air-conditioning professional manufacturing areas, to provide customized solution kits.
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