China produces more than half of the world's annual output of toolboxes and cases. The country is particularly strong in the plastic and aluminum sectors of the product line, accounting for an estimated 60 and 90 percent of global output, respectively. Its share of steel toolbox production is currently small but with output growing by 30 percent every year, China is set to become a major supplier of this product as well.
Some of the key trends we see merging in China's toolboxes and cases export industry include:
• Production will continue to focus on low-end designs, although more midsize and large suppliers are concentrating on sturdier, more durable toolboxes and cases for the midrange and high-end markets in the Unites States and the European Union.
• Slight price increases are inevitable in light of rising raw material costs, although most makers are trying to maintain current price levels.
• Suppliers are boosting capacity in response to forecasts of strong demand this year.
• China suppliers continue to invest heavily in technology upgrades, production equipment imported typically from Italy or Japan and improvements in QC systems.
China suppliers produce plastic, aluminum and steel toolboxes, the first of which comprises the majority of exports from the country. Most plastic toolboxes are small portable models designed to hold tools commonly used in DIY or home repair. The selection of aluminum and steel items covers a wider range that includes small, general-purpose models to large capacity tool chests and cabinets with handles and casters for easier portability. These different types are described in detail in the Products & Prices section of this report.
Toolbox production varies widely from one material to another. The Manufacturing section discusses how the production steps are typically done in China factories.
Target export destinations play a large part in determining the type or grade of plastic, aluminum and steel used to make toolboxes and cases in China. The Materials & Components section discusses the various material types or grades, as well as the characteristics that make them suitable for toolbox production.
This report includes profiles of major suppliers of each toolbox type. Ningbo Jiejie has been manufacturing plastic toolboxes and cases for almost 10 years. Revenue from this produc tline accounts for almost one-third of the company's annual sales of $15 million. Foshan Nanhai Zhixing is the first locally owned company in China to make aluminum toolboxes. It is now also one of the largest in the sector, averaging $10 million a year in toolbox sales. Jiangsu Tongrun is one of China's biggest suppliers of steel toolboxes. In 2004, it generated more than $20 million worth of sales of the product.
More than 80 percent of the suppliers profiled in this report are based in the provinces of Guangdong, Zhejiang and Jiangsu, which are inherently strong in the aluminum, plastics and steel industries.
Industry Overview
Toolboxes and cases continue to be one of the fastest-developing product lines in China's storage containers industry, averaging 20 to 30 percent growth over the past 3 to 4 years. The country already ranks as one of the world's biggest suppliers of the product. Industry estimates place 2004 global output between 330 and 380 million units, with China accounting for 50 percent.
In 2004, China shipped about 130 million units, or more than 70 percent of its output of 180 million toolboxes and cases, mainly on an OEM basis to big-name clients such as Stanley and Sears of the United States, OBI of Germany and Carrefour of France.
China's selection of tool storage containers ranges from portable boxes and cases in open and compartmentalized versions to large capacity models such as chests and cabinets. These are commonly made of plastic and metals such as aluminum and steel.
Plastic models are the most mature of the various toolbox categories in China, having started out as a secondary or support industry to tool-making, particularly in the province of Zhejiang. It has since flourished into a stand-alone industry with production worth $450 million or 160 million units in 2004. This represented about 60 percent of the world's output of plastic toolboxes and cases. About 70 percent of output is exported annually.
The majority of plastic-toolbox suppliers in China are small companies making mainly low-end products, lured to the line by the relatively simple manufacturing process. In-house R&D is quite limited and mostly focuses on modifications of existing products.
However, some suppliers, wary of over saturation in the low-end segment, have started to pay more attention to in-house R&D, developing new product designs and enhancing manufacturing systems that can help them break into production of midrange and high-end toolboxes and cases.
Although product development efforts are still limited to modifications, these improvements push up the value of toolboxes and cases.
While most low-end plastic toolboxes from China have an open construction and only one removable compartmentalized tray, upscale versions have constructions divided into several smaller sections, the removable tray and up to three additional tiers and lids with built-in organizers for extra storage space. Add-ons also include built-in radios, metal latches, reinforcements and clasps.
Some high-end tool cases feature one-piece construction with a light and power source built in. These products are designed in such a way that they form an enclosure around the light and power source when they are folded close, thus doubling as flashlights.
To improve production efficiency, some large manufacturers have set up die-and mold-making facilities equipped with milling machines and lathes for in-house production of dies and molds, a task traditionally subcontracted to specialist companies in the industry.
Young product line
A relatively new product line that started out only a decade ago, metal toolboxes from China are made mainly of aluminum and steel. In 2004, China suppliers produced 15 million aluminum toolboxes or about 90 percent of global output of the product. The country's production of steel toolboxes in the same year made up 5 to 10 percent of world output.
Production for both categories has grown at about the same rate as plastic toolboxes, but actual output is still notably smaller compared with that of plastic because there is less demand for metal toolboxes. Aluminum and steel toolbox manufacture generally employs basic equipment such as punching, cutting press and welding machines. The actual production process, however, is more complex than plastic toolbox manufacture, another factor that is slowing growth in the line.
Supplier profile
Bangbang Tools Manufacture Co. Ltd
Bangbang is a subsidiary of Zhejiang Bangbang Group and specializes in toolboxes and cabinets. Established in 1998, this midsize company started producing toolboxes in 2000. The product line now accounts for most of revenue. Sales in 2004 reached $2.4 million, a 40 percent growth from 2003.
All toolboxes and cabinets are exported either directly or through trading companies. Absorbing 60 percent of exports, the United States is Bangbang's largest market, followed by the European Union and Australia. Seventy percent of shipments to these markets are for OEM customers such as Carrefour, Warehouse and Stanley.
Products
Bangbang's more than 100 models are made mainly of SPCC-grade cold rolled steel sheets purchased from distributors of Baosteel products.
Small toolboxes, including cantilever types, currently account for more than 80 percent of output. Ranging in price from US$4 to US$10, these generate half of the company's toolbox sales. Large toolboxes priced from US$30 to US$500 per unit make up the rest of output and revenue.
A little over 1.5 percent of total annual sales is allocated to product development, which is the responsibility of a four-member R&D team. Development efforts in the next 12 months will focus on improving toolbox aesthetics and safety features and adding more functions.
Bangbang adds more than 10 new products to its selection annually, most of which are developed in cooperation with OEM clients. These collaborations have resulted in the incorporation of smooth corners, inlaid covers, apertures measuring less than 6mm and hydraulic levers.
The company currently positions its products in the low-end segment but is planning to shift to the midrange in light of a recent 10 percent price increase and another 10 percent rise projected in the coming months. The supplier was forced to push quotes up as a result of rising production costs. The cost of cold-rolled steel sheets has already risen 185 percent from $350per ton in 2003.
Manufacturing
The maker has a 7,000sqm workshop in its Jinhua factory dedicated to the production of toolboxes, where 200 of its 500 workers are employed. Another workshop of the same size is expected to be operational this year, increasing the company's capacity by more than 50 percent.
The existing facility is equipped with six rolling mill machines, 20 bending machines to process cold rolled steel sheets, 40 punching machines and 20 welding machines. Also part of the workshop's equipment are five ovens for dry coating semi finished products with plastic powder. These semifinished items are assembled in two lines with other components such as drawer slides, wheels and handles purchased from Guangdong, Hubei or Zhejiang suppliers.
A four-member team checks the quality of welding, plastic coating and assembled products using instruments such as film testers that check the thickness of the coating.
All this column of information contained in China Sourcing Reports is the result of original, independent and impartial research conducted by Global Sources analysts.
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