Zhongtian explores US market at NPE

Taizhou Zhongtian Plastics Co. Ltd.’s small booth at NPE2012 is filled with large, hollow plastic items – pet houses and wheeled garbage totes of different sizes. The first time NPE exhibitor hopes to open up the U.S. market with its injection molded and blown molded products, backed up by ongoing expansions of two new factories in China.

Even with rising production costs in China, strengthening yuan and shipping cost of large hollow items, the company still is optimistic to give the U.S. market a try, said Susan Zhang, an export manger.

Exports already makes up 40 percent of its business, with Australia being the largest export destination.

“Some U.S. customers are already using our products,” she said, through Zhongtian’s contract production for U.S. manufacturers. But the company is hoping to sell directly into the market.

Part of the rationale behind the effort to expand U.S. sales is to compensate for the decline of export in other markets since the second part of 2011. “Our traditional markets are sort of saturated.”

Its investment on overseas expansion is backed up by fast-paced growth in China’s domestic market, esp. through government bids and contracts. Zhongtian’s total sales are around 300 million yuan (about $48 million). Zhang said its domestic sales are expected to grow 10 to 20 percent in 2012, while export is most likely to stay flat.

To add to its production capacity at its headquarters in Taizhou, Zhejiang province, Zhongtian is launching its second factory, located in Liaoning province in Northeast China. Zhang said the plant is built on a campus of 120 mu (about 20 acres).

Zhongtian is also building a third factory, on about 15 acres of land, in Taizhou, Zhang added. The new plant is scheduled to commerce production in 2013.

The privately owned company is investing 150 million yuan ($24 million) this year to build about 624,307 square feet of new manufacturing space, according to a report on its web site.

Zhongtian has about 50 injection molding presses, plus blow molding machines, welders and other equipment.

Its workforce of 300 is expected to grow about 20 percent with the new factories, but Zhang stressed that the company is increasingly adapting automation technologies and upgrading its existing machinery to increase efficiency.