Dahua Technology posted strong growth of more than 50 percent, reaching US$ 123 million for the first half of 2011. The company's domestic and overseas sales were respectively US$ 89 million and US$ 34 million, with overseas markets growing nearly 91 percent. a&s talks to President Fu Liquan and Vice President Michael Chen to discuss what makes the company successful.
Dahua Technology posted strong growth of more than 50 percent, reaching US$ 123 million for the first half of 2011. The company's domestic and overseas sales were respectively US$ 89 million and US$ 34 million, with overseas markets growing nearly 91 percent. a&s talks to President Fu Liquan and Vice President Michael Chen to discuss what makes the company successful.
Some experts believe the security industry in China is on the verge of a new phase. As more players talk about customization for specific vertical markets and projects, this requires more resources and integration between different security systems. Product suppliers used to manufacture a single product, but now they must adapt to be solution providers for versatile and specific demands.
Fu Liquan, President of Dahua Technology, has his own opinion on industry developments. “There is no doubt the market d e m a n d s s o l u t i o n providers,” he said. “Some people believe that in a few years, there will only be few big players remaining on this stage. I think otherwise.”
Fu pointed out that security is not like the telecommunications industry in China , which is dominated by Huawei and ZTE. “The Chinese security industry emphasizes government projects and specific customized projects, which are not easy to replicate on a mass scale,” Fu said. “For example, traffic monitoring solutions might be different, depending on the region. It takes industry players to invest more resources but may not yield corresponding profits.”
Furthermore, China is a society that greatly emphasizes relationships. Therefore, Fu believes the Chinese security industry will surely move to system integration, which could eliminate unfit suppliers in the long run. But it will not be dominated by a few major players. Greater integration requires “co-petition,” as no one player can do everything by their own efforts.
Continuous R&D Investment
Fu pointed out that the company relies on its core value — technology. The company continues to invest in R&D, ensuring its product competitiveness. In Fu's opinion, Dahua's products should be unique and superior to anything else. The company plans to increase its R&D budget. Its R&D team will recruit to 1,000 staffers, from its existing 800. Furthermore, the company's long-term goal is to develop other security products, such as alarms or intercoms. Fu pointed out that all individual products must be outstanding to work together as an outstanding solution. “All products need to be designed for usage in solutions from the outset,” he added. “Therefore, we are setting up a R&D team for solution products.”
The company remains open to technology partnerships. However, there is one condition before any means of cooperation is undertaken. “We need to understand new technology and have our initial in-house R&D capabilities,” said Fu. “Then, we can better develop and integrate new technologies into our products. If you do not have a basic understanding, you cannot ensure your product will deliver better performance.”
The company will showcase new products with its enhanced R&D capabilities. These include a full series of 960H cameras, a wide range of HD-SDI DVRs as well as network cameras.
IP Brings Opportunities and Challenges
From Fu's standpoint, video surveillance will be focused on intelligence, high definition (HD) as well as integration. When it comes to IP and integration, the importance of software cannot be underestimated. For most hardware manufacturers, IP brings more opportunities but also new challenges. “In an IP world, it requires a software platform,” he said.
For example, the company just partnered with video processing expert NetPosa, a Beijing-based company, to develop software and hardware for demanding security users. “This partnership does not mean we have given up on our in-house software development,” Fu said. “We are working to combine our hardware with NetPosa's management software, which will upgrade product development and bring greater opportunities for both parties.”
Promising Overseas Market
At the overseas front, the company enjoyed nearly 91 percent revenue growth in the first half of 2011. Fu believes success came from its strong sales team. “We see great potential in the overseas markets,” he added. “We hope that by connecting with foreign buyers, it helps us to better understand international applications, as these applications are ahead of China. These product requirements give our R&D team a good reference to refine our products.”
“We would like to work with our overseas partners on every front,” said Michael Chen, Vice President of Dahua. “The key reason for Dahua's success was our products cater to user needs and different market requirements, thanks to our R&D capabilities and an ideal ratio of price-performance. This truly gave us an edge to penetrate challenging markets, such as India, Brazil and other emerging markets.”
From Chen's standpoint, a video system symbolizes a circle connecting everyone. With more possibilities and potential growth, the larger the circle will be. Dahua's ultimate goal is to help customers realize their business goals by partnering with the company. Chen believes Dahua has the complete product lineup to satisfy buyer needs, enabling customers to enjoy high performance and quality products from entrylevel to high-end.
This year, the organization will enhance its front-end devices. “We will promote our solution in overseas markets,” Chen said. “With our strong and highly performance back-end devices, we offer our customers a complete package. Our new analog and network speed domes are already in our portfolios.” Lastly, Chen added the overseas sales team will also recruit more people to better serveits customers.