| Summary: | 碩士 === 逢甲大學 === 經營管理碩士在職專班 === 102 === Manufacturing of fitness equipment is one of the traditional industries. The complexity of the equipment, its complicated production processes, parts processing of various types of materials, and the related safety regulations create entry barriers for potential entrants to this industry. Most of the major fitness equipment manufacturers are base in China and Taiwan, and many Taiwanese businessmen take advantage of the manufacturing strengths and resources from both places to establish their business. However, various factors are causing a great threat to Taiwanese businessmen in their product manufacturing and brand marketing in China, including the increasing labor wage in China, the counterfeit and price competition issues, China government’s land and rural development policies, and the government’s support for their local brands.
Most studies of the fitness equipment industry in Taiwan are case studies on the innovative product design and marketing strategy of brands. This paper will be focusing on the core competition advantage and business operation stratagem for OEM companies. This paper conducts of an in depth case study of one of Taiwan’s leading OEM manufacturer of fitness equipments, interviews with the top managements and the collection of relevant information to understand their business model, analyzed the company’s core competition advantage based on the Resource-Base View and VRIO structure, and implementing the model of SWOT proving strategy advice. This case study can serve as a good reference in the field of sustainable OEM and business upgrades for other Taiwan’s manufacturers of fitness equipments.
The major markets of the fitness equipments are USA, Europe, and Asia. These three markets cover around 90% of the whole global market. In mature markets like the USA and Europe, most of the market share is concentrated on those well-known big brands; other new labels that wish to enter these markets will face many difficulties. In the emerging Asian market, especially the Chinese market, hundreds of Chinese brands compete by lower prices and receive support from China government. Thus, for both brand management and OEM operations, Taiwanese corporations need to create a unique completive advantage and strength in order to stay ahead from the competitions. As an OEM manufacturer, having the opportunity to grow together and keep a close relationship with customers is very critical. The Taiwanese manufactures can joint venture with USA and/or Europe customers based on the close relationships and use Taiwanese advantages, such as location, language and culture to enter the Chinese market and offer high end products to differentiate themselves from local Chinese brands.
Also, here are the suggestions/evaluation steps for the fitness manufacturer who attempts to manage a label before they entering the markets; corporations should understand their competitive situation and company’s core competitive advantage first, and then to evaluate the relationships with their customers and the potential impact of losing customers by conducting a company own brand.
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