Guangdong Deerma Technology Co., Ltd.
德尔玛
301332
Shenzhen Stock Exchange
Company Profile
1. Focus on “internet + industry” and “supply chain + brand” to tap core small appliance demand at home and abroad Starting off as an outsourced operation provider, the Company developed profound insights into the internet and a first-mover advantage to pinpoint and capture every wave of internet profitable trends, such as horizontal e-commerce, social commerce, cross-border e-commerce, and live-commerce. Valuing greatly what consumer engagement can do in product innovation, marketing and conversion, and service improvement, the Company fully taps the potential of data from online sales to further guide marketing with data analytics. Based on its private-domain user data and the consumer life cycle of awareness, interest, purchase, and loyalty, the Company refines profiles of consumers from different demographics to look for prospective customers and drive sales from existing customers with higher marketing accuracy and conversion, enabling the Company to remain in a competitive position in the ever-changing internet sales market. The Company is located in Shunde in the Pearl River Delta region that enjoys industry cluster advantages for small appliances. Shunde is all the more famous for the “City of Home Appliances in China” as it is home to many well-known small appliance players including Midea Group, Xinbao Electric, Bear Electric Appliance, and Deerma, offering an industrial chain advantage. The Company has been investing in its own production capacity and, after years of efforts, has established a strong in-house capacity. In addition, the Company has integrated its production and sales systems and established a management and planning system for order scheduling, quality control, warehousing, and other operations and has continuously stepped up investments in automation to improve its production efficiency. Based on its core advantages in supply chain and product development capabilities, the Company has engaged in deep cooperation with Xiaomi. On the one hand, it has enabled integrated procurement of components in a vertical category and deepened the vertical supply chain to standardize core components, improve product quality criteria and reduce supply chain costs; on the other hand, the cooperation has enabled stable scalability of production capacity that smooths out the full-year capacity curve to gradually form a batch of stable and mature mass production lines. 2. Market-tested category and brand diversification capabilities to lay a solid foundation for future development The Company sticks to a “multi-brand, multi-category, and global” development strategy to continuously replicate its proven methodologies and build itself into an innovative home appliance leader that meets new consumption needs. Centered around the rapidly growing emerging home appliance category, the Company has formed an established portfolio of brands with different market positionings, target customer groups, and business models. The Company covers each product category and delves into corresponding consumption scenarios with its different brands. Professional teams of the various brands continue to accumulate experience in R&D, design, production, and sales in their segments and to launch high-quality, aesthetically pleasing, and value-for-money home appliance products. 3. Outstanding global expansion capability At present, China has the world’s largest production capacity of small appliances. With the industry cluster effect and relocating global industrial chains, China’s small appliance brands are faced with an inevitable choice of turning to overseas markets. Driven by its supply chain advantages, product innovation capabilities, cost-effective products, strong online operation capabilities, and Philips’ global brand DNA, the Company has gradually carved out a position in overseas markets, with outstanding global expansion capabilities. The Company has established a professional overseas sales and operation team, an expanding overseas sales network, good relationships with overseas customers in Europe, Asia, and South America, and a direct-to-consumer presence on Amazon for overseas sales. Additionally, the Company has been exclusively licensed by Philips for a variety of products, including water purifiers, water heaters, smart bathroom products, and mobile massagers. The Company’s offshore sales network has gradually taken shape through its continued efforts to deepen its offshore presence with new branches in Hong Kong, Europe, and North America, and enter distribution channels such as hypermarkets, department stores, and retail outlets. At present, the Company’s offshore footprint covers Hong Kong, Brazil, South Korea, Russia, Ukraine, Indonesia, Japan, Thailand, and other countries and regions. In 2020, 2021, and 2022, the Company recorded offshore sales for owned and licensed brands of RMB232.4846 million, RMB440.9884 million, and RMB446.4943 million, respectively, with a CAGR of 38.58%.
Full description
Guangdong Deerma Technology Co., Ltd. is an innovative home appliance brand enterprise that integrates proprietary R&D, original design, in-house production, and independent sales capabilities. The Company operates brands such as “Deerma” and “Philips” and offers a variety of products in home environment, water health, personal care, and sanitary ware. Focused on a mission to “refine the life with products and improve the life for users” and a “multi-brand, multi-category, and global” development strategy, the Company defines and develops consumer-oriented innovative products and brings innovative home appliances that meet new consumption needs. With rich experience amassed in providing outsourced e-commerce operations, the Company’s founding team established its proprietary brand “Deerma” in 2011, which recorded rapid topline growth thanks to the team’s strong hands-on track record in internet marketing. After accumulating rich supply chain management capabilities for small appliances, the Company began to gradually build its own capacity in 2014 to deepen its presence in production, laying the foundation for its integrated development of research, production, and marketing. In 2018, the Company acquired Philips’ water health business, gradually completing its business coverage of multiple categories through multiple brands. Since 2019, the Company has drawn on its efficient supply chain advantage and aggressively expanded overseas sales channels to achieve rapid topline growth overseas. In 2021, the Company was exclusively licensed by Philips for mobile massage products, further diversifying its product categories. Through nearly a decade of development, the Company has built extensive internet marketing capabilities that cover mainstream e-commerce platforms in China, and actively leveraged emerging marketing methods such as live streaming and short videos to enable closer access to consumers and higher conversion. The Company is sensitive to any change in consumer demand to continuously launch blockbuster products through accurate commercialization, responsive product design and development capabilities. Located in the Pearl River Delta region, the Company has advantageous access to a cluster of small appliance industrial chains and has also established a strong in-house production capacity, based on which it secured strategic cooperation with Xiaomi to produce customized Mijia products. After acquiring Philips’ water health business, the Company continuously strengthens its R&D capabilities through synergetic learning between its existing R&D system and Philips’ R&D system, to realize “agility” while remaining “systematic”, facilitating rapid product iteration. The Company is committed to riding its business on two engines of growth, i.e., China’s consumption upgrade and overseas expansion of core manufacturing advantages. From the perspective of product diversification, the Company will focus its product development efforts on vacuum cleaning, water health, and personal care under its major brands “Deerma” and “Philips”, to evolve towards wireless, compact portability, versatility, intelligence and IoT, and healthy life; from the perspective of international presence, the Company will leverage Philips’ global brand and multi-category advantages to actively expand overseas sales channels, including cross-border e-commerce, and utilize efficient supply chain capabilities to introduce its domestic brand to international markets.