Page 42 - Taiwan Hand Tools 2022-03 Edition

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INDUSTRY TRENDS

how. As a result, companies either need to rely on migrant With upstream companies such as China Steel providing
workers, which have become difficult to obtain due to stricter quality raw materials and sub-contractors providing more
border restrictions during the pandemic or have brought specialized treatments, such as forging, heat treatment, and
automation to production chains and greater emphasis on electroplating, Taiwanese hand tool companies quickly rolled
talent retainment. out medium to high-end OEM products of big-name brands
in the U.S. and Europe.

A government-led initiative also joined big-name
machinery companies and hand tool companies to introduce
more automation and smart machinery capabilities into the
manufacturing process.

While more challenging to stay afloat during crisis times,
Hsiao says most hand tool companies in Taiwan as SMEs
serve as a confidence booster for potential international
buyers. The industry has a more robust foundation as a
hub-oriented sector, where the production chain is more
compact and centralized in a single area. In contrast, hand
tools industries in other countries could more likely face
Hsiao says that Stand Tools, rather than contend with higher disruption risks due to longer-distanced processes in
external factors out of their control, turned inwards by different locations or countries.
introducing training programs and improving employee skills
and morale. As a result, in the two years of the pandemic, it Taiwan’s hand tool products are less competitive against
was clear that companies capable of reinventing the wheel Chinese products in terms of prices, but with the global
and maintaining the flexibility to keep up were more likely economy entering the third year of the pandemic, Hsiao
to survive. As Hsiao would quote, opportunity favors the says the circumstances have shed an unflattering light
prepared. on the pre-pandemic supply chain’s just-in-time model.
International policies, such as China’s strict zero-COVID
On the other hand, traditional industries like the hand policies and power shortages in late 2021, have also caused
tools industry have seen their talent pool and resources further disruption of the supply chain. There is a need for
gradually diminished by concentration on specific, popular greener energy and zero-carbon initiatives, which Hsiao
sectors, where new hires are more likely to flock to, Hsiao says can become a deciding factor for companies deciding
said. This is due to a more stringent collaboration channel whether to do business in the country or not. All are factors
between the academic and industry sectors in these popular and advantages that Taiwan’s hand tool industry maintains.
industries, such as the semiconductor sector, where it THMTA Chairman Huang Hsin-te was quoted by local
ensures that higher education institutions are capable of media Global Views, that Taiwan’s hand tools industry value
producing industry-ready graduates, and should industry could hit NTD$140 billion in 2021 as of writing. The current
workers wish to change their career path, some would be trajectory would ensure continued growth for at least another
able to return to these academic settings to teach and pass decade.
along industry know-how.

Very few industries in Taiwan can produce such a
backdrop that can send new talents and retain industry
experts between the academic and industry sectors, such
as the semiconductor industry. However, this also highlights
the difficulties and challenges for the other “less popular
industries,” such as the hand tools industry, as industry
know-how and talent retention are less accessible and
achievable.
To bridge the gap, in recent years, Taiwan Hand Tool
Manufacturers Association (THTMA) had local companies,
benchmark companies, China Steel Corporation, and
the government pool resources together to innovate the
manufacturing process and produce better quality products.

Taiwan Hand Tools 2022 Issue