Chuango: Bringing smart home tech to ordinary families
Editor / Provider: Editorial Department, a&s SMAhome | Updated: 9/24/2014 | Article type: Hot Topics
Established in 2001 by Ken Li and his late father Lee, Chuango Security Technology Corporation specializes in radio frequency technology and wireless smart home systems, ranging from DIY security and home automation to energy and health management. When Chuango began making radio signal antennae and security alarm systems, it operated mostly as an original equipment manufacturer (OEM), supplying to distributors, resellers and alarm-monitoring companies in China, Japan and the U.S. Then came 2010, the company expanded its production lines from Fuzhou to Shenzhen, doubling its capacity to accommodate accelerated sales growth.
In 2013, Chuango achieved another milestone that catapulted the company to the road of branding: the G5 GSM/ SMS RFID Touch Alarm System won the Product of the Year Award (Intruder Alarm or Exterior Deterrent Category) from IFSEC & FIREX Awards. “Winning this prestigious award certainly means a lot to us as it recognizes our commitment and continuous dedication to providing innovative solutions to our customers,” said Ken Li, founder and CEO of Chuango. “For the show's 40-year history, the category award winner has never been an Asian brand, nada. I believe our young, energetic and creative team will continue to spice things up in the industry and markets worldwide.”
After stealing the show, the company swiftly shifted its business model and focus to introduce more private-label and branded products directly to distributors and retailers, etching another mark in its rapid transformation. “Developing consumer electronic-like DIY smart home systems requires a lot of investment in R&D and constant market studies and promotions, which cannot be sustained by the not-so-profitable OEM/ODM business. If we want to break free from the shackles of a stereotypical Asian OEM, we must grow with times to achieve something greater,” Li said. “Many manufacturers change products or marketing strategies passively. We lead by thinking differently, making adjustments proactively, and we always introduce fresh elements to everything that we do.”
Thanks to Chuango's accelerated year-on-year revenue and personnel growth, the company has the resources and ammunitions to further build its research facilities, outside of Fuzhou and Shenzhen, in Taipei, Amsterdam and – in the near future – Silicon Valley to sustain its brand development of Chuango and smanos, as well as category development from burglar alarm (Chuango) to residential surveillance, health and energy management, and smart home (smanos).
EXTENDING PRODUCTION PROWESS
With the go-to -market strategy expanding from fulfilling orders for importers and resellers to include mainstream distribution and retail channels, Chuango is in need of even greater production capacity. “We acquired a 2,000-square-meter production plant in the Changan district of Dongguan in June, and the facility just went online in August,” Li shared. “Before we grow our product categories, we're already anticipating more diverse system and accessory requirements yet shorter lead time due to intensifying competition, so that's why we acquired the Changan facility in the first place. Another reason is that the smart home market is even more demanding on the product aesthetics and design detail. While we've had our in-house industrial design team all these years, molding and plastic injection were always outsourced, until now.”
This new 2,000-square-meter or 20,000-square-foot production base ensures streamlined development and production flows, not to mention further strengthened quality assurance procedures along the way, from design, molding and injection to production and assemblies. “Changan is the center of the molding universe, and we're confident in having one of the best teams in the industry to meet all future demands, with enhanced production capacity and quality,” Li stressed. The facility is just an hour away from Shenzhen, for easy logistics and convenient customer visits.
ICT AND QA READY
Chuango is also fortifying its software development (system controls, apps and cloud) and IP communication footing, with the establishment and expansion of the Taipei, Amsterdam and very soon Silicon Valley teams. The satellite teams will be working closely with Fuzhou, Shenzhen and Dongguan to expedite time-to-market with respect to next-gen wireless, 4G and cloud solutions. Another machine-to-machine (M2M, or IoT) R&D team is also up and running in Fuzhou, alongside the quality assurance team that ensures international production processes and mass production requirements are met.
For Chuango, it is never just a saying. “When we say we want the best for our customers, we deliver. As we embark on this journey of global marketing and branding, our vision and pursuit for perfection are not limited to local standards; we devise the toughest quality assurance tests possible on all our production lines and products, and are working to extend our warranties from two years to three to five.”
Industry reshuffling is imminent, with tech giants and startups as well as security conglomerates coming into the picture. Chuango is laser-focused and has a clear vision and development path, with users and market demands in mind. “We know what our priorities are and will keep doing what we do best,” Li said.
Healthy competition is good for any industry. With increased media coverage on the smart home, the industry and market are poised for further maturation and growth, and only the best of the best will remain standing. “Nevertheless, Chuango remains open-minded and opens its arms to any type of collaboration, be it with security and automation juggernauts or startups with brilliant ideas. We're looking for sustainable growth, not just one-year wonders,” Li said. While the likes of Apple and Google pose a potential threat, Chuango is more interested in how they tackle users' problems and adjust go-to-market strategies. “Our strength builds on the fact that we have been exploring the smart home for 14 years, and we are one of the few that can provide integrated hardware and software solutions, with localized support and services.”
The future of the smart home will be about integrating security and safety systems, electronic and appliance controls, and entertainment units with wireless and information technologies. “Chuango will continue to work on striking that perfect balance among security, comfort, convenience, personalization, usability and affordability. At International CES 2015, we will be announcing an all new, all-around smart home system that thinks for you, realizing the ultimate simplicity in system setup, operation and user experience,” Li shared excitedly. “We will also be working closely with industry-leading IC provider Silicon Labs, to bring its sub-GHz module solutions to life by empowering our clients and end users with smarter, connected homes.”
At the moment, Western Europe and the U.S. are Chuango's and smanos' biggest revenue contributors, and “emerging” markets such as Eastern Europe, Russia and CIS, East Asia, ANZ, the Middle East, Africa and LatAm are just ripe for further business development. “For even more detailed market analyses and tailored services, we will hire a few more business development professionals in the U.K., France, Germany and Italy, with ICT distribution and retail channels remaining our major route to market,” Li added. “With dedicated, local sales and marketing efforts, our highly flexible, compatible, affordable DIY solutions, such as security and automation, lighting controls, and energy and health management, are well on their way to become local favorites.”
With ever-increasing demand for wireless DIY security and smart home systems, Li is rather excited about the next three to five years. “Our sales are forecast to grow by more than 100% per year over the next few years, with multiple product development and business development teams all over the world unleashing their creative potential collaboratively. We're also open to OEM/ ODM possibilities.” To keep channel and end customers interested and engaged, Chuango is constantly on the lookout for the right fit and talent for “glocalized” development.
Cloud-based technology and smart touch devices are promising exponential growth, and Chuango and smanos are poised to expand their portfolio and footprint beyond security to automation, lighting, energy management, entertainment and safety/ health-monitoring devices. “The ability to control a multifunctional system using a smartphone app, coupled with a unique and fashionable product design and interface, is a winning combination,” Li exclaimed. “Technology allows us to reach far beyond average, middle-aged homeowners. For example, we can effortlessly tailor our offerings or user experience to specific market segments, such as telecom operators, student dorms and luxury yachts.” In China, Chuango is piloting the sales of home-use IP cameras together with alarm and safety devices through an online-to-offline retail model, with concept stores opening in Beijing, Shanghai, Shenzhen, Zhengzhou, Chengdu and more cities that allow end users to experience Chuango smart home wonders before placing orders on site or online.
The proliferation of wearable technology is another area that Chuango is keeping an eye on. “Wearable devices, to me, are part of our industry development, as they are designed to make life easier and more convenient,” Li said. “There is no doubt that finding ways to satisfy needs of security, safety, comfort and convenience is the way forward, and we're more than ready!” Smart home is no exact science, but a unique combination of art and technology. It is Li's vision that Chuango and smanos products can blend in any ordinary family and be part of their day-to-day life.
Like Li, the entire Chuango global team is dynamic, fast-paced and always ready to react to various customer demands and feedback, with award-winning product designs and features that reflect Chuango's core competence and value. “We are bringing innovative, easy-to-use and aesthetically pleasing products to market, and our offerings ensure significant value and profitability for those who are prepared to put the effort in and grow with us.”
Founded in Fuzhou, China in a 9 sq.m./ 100 sq.ft. garage
Introduced surface mount technology (SMT) to system mass production
Started system exports, especially to the U.S. and Japan
Market traction in Europe and Asia
Production lines expanded to Shenzhen
Inception of smanos, a new smart home tech brand
Established Chuango Europe in Amsterdam and Chuango Taipei Innovation Center
Company IPO and further expansions