Zhejiang New Oriental: Do not put all eggs in one basket

It is a challenging year for many China fastener enterprises in 2008. Rise in material price, tight money, RMB appreciation and other factors have caused great difficulties to enterprises. Facing these external changes, Ms. Betty Chen, spokesman of Zhejiang New Oriental Fastener Co., Ltd. said, "We shift our focus to internal effective management and effective technical advance. We try to lower the production cost in order to offset the rising costs partially through reforming technics, improving quality and reducing consumption."

A number of ways to get through the "cold winter"

In the face of the economic recession, it is a also good way to get through the "severe winter" by strengthening research and development, increasing production efficiency and reducing costs. According to Ms. Chen, New Oriental, together with the National Testing Center, developed a strong acid pickling drawing machine that saves a pickling process consequently. At the same time, they also developed its own oil blow equipment which not only increases the oil recycle rate and saves lubricants, but also achieves clean production. In addition, New Oriental also developed an automatic feeding rack which improves both the working conditions and produce efficiency.

Many enterprises faced new difficulties caused by fluctuation of material price and global financial crisis. Because lots of businessmen were generally in a state of "wait-and-see" , they were more careful when receiving orders. However, New Oriental has its solutions. They did not put all eggs in one basket. They delivered products in diversified markets instead of just one or two markets. When it is dark in the east, it is light in the west. The loss in domestic can be supplied by overseas gain. Hereby, they have no obvious pressure on sales.

As the New Oriental has established a good reputation for years, the clients highly trust the quality of their products. Therefore, the clients are also willing to raise the prices accordingly to offset the difficulties of manufacturers when they know their materials prices.

Strengthen itself to withstand the risk

New Oriental has engaged in the export of fasteners for years. According to their understanding on international fasteners market, the main weaknesses of domestic enterprises are low-end products with less value-added, and they are still at the stage of simple processing. In order to improve the competitiveness of products, we can do nothing but increase the technical content of products. At the same time, we need to strengthen internal management and enhance ourselves. We are able to withstand the risks including increasing materials price, higher salaries, changes in RMB exchange rate, elimination of tax incentives, etc. to truly participate in the international market with free competition.

Financial crisis not only affected the orders but also increased the risk of trade. To avoid the risk of trade especially the foreign exchange risk, New Oriental enhanced itself from two main aspects: First, to make credit surveys on new customers in order to eliminate the risk on early stage. Second, to participate in export credit insurance in order to reduce the damage degree on the enterprises after the risk of foreign exchange happened. Double insurance and early preparation to ensure the safety of foreign exchange business.

The three major product series of New Oriental are rods, bolts and nuts which cover various industries, such as machinery, construction, electronics, electrical appliances, etc. The products are exported to Europe, the United States, Middle East, South East (Middle) Asia and other international markets. Since 2004, New Oriental has jumped to the regional Top 3. It is one of the best ways to improve the brand's popularity by media promotion in such an IT era. New Oriental exhibited at 2008 Fastener Trade Show which was organized by China Fastener Info to promote their products and understand the whole development trend of the industry at the same time. Moreover, New Oriental also took part in some worldwide exhibitions to better grasps the global pulse of the fastener industry both inside and outside.

New Oriental plans to set up a domestic sales department in the future. With both domestic sales and export, New Oriental will fully expand the market and enjoy a brighter future.

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