Overview of the Nanyang Optics Industry

Author: Jun Ni

Time: The evening of May 9, 2022

Nanyang City is located in the Central Plains of China, with a total area of 26,500 square kilometers and a population of about 10 million. It is one of the famous optical industry bases in China. There are thousands of optical factories and optical-related companies, large and small. Products include optical components, lenses, prisms, assembled lenses, filters, sports optics, and supporting optical components for various equipment and instruments. Among the thousands of optical companies, there are companies of all sizes: the largest companies are the listed companies and rank at the top10 in the industry, such as Henan Costar Group (Website:www.hn508.com.cn), and Lida Optic-electronics (Website:www.lida-oe.com.cn); while the smallest companies only have several optical milling machines or polishing machines, and only do one or several processes to the whole production line. Well, the entire Nanyang Optics industry is famous in the industry for its high quality, low price, and high-cost performance.

As a veteran of the Nanyang Optics industry, I have divided all the Nanyang optics enterprises into three levels of echelons.

The first-level echelon, the listed companies represented by Henan Costar Group and Nanyang Lida Optoelectronics, is the benchmark and leader of the Nanyang Optical Industry.

The second level echelon is represented by the high-tech optical & electronic park and Huanggang Industrial Park which have hundreds of enterprises and form the enterprise cluster. There are various scales among the hundreds of enterprises, mainly small and medium-sized enterprises. Larger ones have one building in the industrial park as a factory, while those with average or smaller scales have only one floor, or several companies share one floor.

In the third level echelon, there are still hundreds of optical companies that do not build in the industrial park cluster, but are scattered in various streets, suburbs, and surrounding counties and townships in Nanyang City. Among them, there are also large-scale companies, but most of them It is a small-scale processing enterprises with supplied materials, as well as a supporting processing enterprise for some processes of some products of some large companies.

Enterprises in these three levels of echelon correspond to different customer groups:

The first-level echelon enterprises have the higher added value of product brands. Henan Costar Group is a state-owned enterprise. Nanyang Lida Optoelectronics Co., Ltd. is a core wholly-owned subsidiary of Henan Costar Group Co., Ltd. Lida company has more than 1,000 sets of world-class optical coating, grinding and manufacturing equipment, and testing instruments, which are in good agreement with many well-known domestic universities and research institutes. It has formed four core technologies of optical technology, optical film, optical design, and photoelectric detection. It has a strong industrial development foundation and international market competitiveness. It is an excellent supplier for many well-known global companies such as Huawei, VIVO, OPPO, Epson, and Fuji, etc.

The products of the second-level echelon enterprises are in the middle reaches of the optical industry, and their customer groups are mostly domestic and foreign brand owners, buyers, trading companies, and other downstream companies in the optical industry. Because they are located in industrial clusters. Therefore, ordinary customers can easily find these enterprises through channels such as online websites and exhibitions. The price-performance ratio of these factory products is generally not high, because these companies often participate in exhibitions, and many customers come to visit, so their expenses are more spent on decoration and promotion ads. This disguisedly increases the cost of their product. (Note: I am talking about the high probability situation above. There are also a small number of companies in the agglomeration area that do not advertise and promote because they have their own fixed customer groups, the production volume is relatively full, and the companies also are no plans to expand the scale, so there is no promotion. So you can’t find these companies on the Internet, but you can see these companies if you visit the factories one by one in the gathering area.)

The number of companies in the third-level echelon is very large, with more than 500 or 600 companies. Their products are also very cost-effective and cheap, but without the help of local industry veterans, it is not recommended to choose these companies. Because the quality gap of the products of these factories is very large, some factories can do a good job of the quality of the products, but there are many that do a poor quality.

Some of the factories in this echelon can do a good job of quality are for the following reasons:

First, the bosses of these factories resigned from Henan Costar Group or Lida Optoelectronics Company to start their own businesses. They know the product very well, and many are originally optical engineers.

Second, their factory buys all the latest equipment with very high precision. Although the number of factory equipment is small and the scale is small, the quality of the products produced is very high.

Third, they come from first-class factories and have a network of first-class factories. Then the products made are sold to these first-class factories such as Lida Optoelectronics, Sunny Optics, and other famous brands, so there is no shortage of customers. They have no online information, no website, no promotion, so no promotion fee. In addition, their labor force is cheap, and many of them hire villagers in the villages, so there is no need to provide compulsory insurance for village employees, which saves a lot of money.

If you can find these companies as suppliers in the third echelon, you will get a very cheaper price and very good quality product. But if you are not familiar with the entire optical industry in Nanyang, you cannot find these manufacturers at all.

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