(Yicai Global) Oct. 21 -- Many Chinese contract coffee maker manufacturers are striking out on their own and building their own brands as coffee machines become more popular in China and export orders jump.

Some factories that Yicai Global visited recently in Shunde, southern Guangdong province, which is the capital of small household appliance makers, are preparing technological upgrades or developing their labels.

Homezest Tech, China’s largest drip coffee machine supplier for overseas clients, and Xinbao Electrical Appliances Holdings, which commands 40 percent of the country's coffee maker exports, are starting their own brands. And coffee maker giant Gemilai continues to invest in the China market.

Coffee machine sales on Alibaba Group Holding’s e-commerce platform Tmall increased for six straight months this year, more than tripling from the same period last year, according to All View Cloud.

China’s big cities, which comprises its first, second and third-tier cities, are experiencing a jump in coffee maker sales, Zhang Lizheng, head of Philips Home Appliances China's coffee machine business unit, told Yicai Global.

Exports are also booming. Coffee maker exports surged 16.5 percent in the first seven months from a year ago to USD1.4 billion, according to the China Chamber of Commerce for Import and Export of Machinery and Electronic Products. Over 60 percent of this was destined for the North American and European markets.

All-in-One Solutions

Chinese coffee machine manufacturers are developing techniques to which they hold the intellectual rights, Liu Chunyu, vice president of Homezest, told Yicai Global. Instead of using technology supplied by their clients, as they did in the past, companies can now provide their own one-stop solutions from design to manufacturing to packaging.

This year, Foshan, southern Guangdong province-based Homezest developed an all-in-one grinding and brewing coffee machine for a well-known client in three months, Liu said. They used their own technology and solutions and the customer only had to design the appearance and mould.

"We are also trying to build our own brands in China," he added.

Stiff Competition

At present, China's coffee machine market is mainly dominated by foreign brands such as Italy’s De'Longhi, Switzerland’s Nespresso and the US’ Philips. But their share of the market was diluted to 60 percent in the first half from 76 percent in 2020 as competition with local brands intensifies, according to AVC.

Treviso-based De'Longhi Group is expanding in China. Its subsidiary in Dongguan, Guangdong province, De’Longhi-Kenwood Appliances, which mainly makes coffee machines, is carrying out a CNY280 million (USD38.6 million) expansion project.

Italy's century-old coffee grinder maker Eureka is also preparing to move in and is setting up a joint venture factory in China with Shanghai Penini Import & Export, the trading company’s Marketing Manager Shen Weibo said.

Editor: Kim Taylor