Chinese handset makers, coping with intensifying competition at home, have been ramping up their efforts to tap into the overseas markets in the past years.

It is expected total export volume of domestic vendors to reach over 32 million units this year, up from about 20 million units last year, with Huawei, ZTE, TCL and Bird accounting for the bulk of sales.

Chinese companies use a range of strategies when entering overseas markets. Generally, there are four approaches to overseas market entry: ODM, agency/distributor, operator channel and establishing a proprietary sales channel. ODMs manufacture handsets for overseas branded vendors or operators, who then use their own brand logos on the handsets. For branded exports, domestic vendors usually go through local agencies/distributors or work closely with operators, as well as build up their own sales channels.

Ningbo Bird's exports totaled more than 6.1 million units in 2005, up from 3.3 million units in 2004. It mainly targets emerging markets with its mid- and low-end GSM/GPRS products. It is believed the company will fail to reach its 2006 export target of 8 million units, given its lackluster performance over the first three quarters of this year.

In the past, Bird has entered emerging markets through local agency/distributors. Bird has set up its own sales channels for robustly emerging markets such as India. Additionally, it works closely with vendors and operators in developed markets through the ODM model. Reportedly, ODM and branded exports contribute evenly to Bird's total exports to date.

In terms of ODM, Bird provides handsets to Sagem and European operators, such as Vodafone and Orange. For branded exports, Bird uses its own sales channel in India and works through agencies/distributors in Russia, the Middle East and Southeast Asia.

TCL surpassed Bird as the leading player in the overseas handset market in terms of export volume last year. It is believed Huawei and ZTE will both exceed Bird's volume this year, mainly due to their strong performance in overseas operator markets.

Amid the increasing competition, Bird must strengthen its operator channels and enrich its product lineup by launching high-end and 3G models in order to improve profit margins and strengthen financial performance for the company, which last quarter saw results in the red.

Leveraging Alcatel's overseas sales presence, TCL jumped to the top position in 2005, with a shipment volume of 6.4 million units. BDA expects the company will continue to bear fruit from its strong overseas presence, with an export volume predicted to reach 9.5 million units this year. The overseas market became an essential component of company sales, making up over 85 per cent of total shipments over the first three quarters this year.

Asia-Pacific, Europe, the Middle East, Africa as well as Latin America, are TCL's main export markets, which like Bird, also focus on mid- and low-end GSM/GPRS phones. The company uses ODMs and its own branded exports as its two major methods of overseas sales. In terms of ODM, TCL entered the Russian market using local brands, and leverages Alcatel's good brand awareness in Europe and Latin America for its own branded exports. It provides Alcatel branded handsets to Vodafone, Telefonica, Orange and some distributors in the markets listed above.

Source:未知