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CTA (China Textile Auxiliary) Network Exclusive Interview in May
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In early May, CTA visited Honghao Chemical Co., Ltd. located in the Jianggu Chemical Base in Sihui, Zhaoqing City, Province, and Qingyuan Hongtu Additive Co., Ltd. located in the old factory in Qingyuan City, Province. General Manager Fang Weihong and Vice President Dai Hongmei of Honghao Chemical, Engineer Cheng Wenjing and Technical Manager Li Shurong of the R&D Department, Manager Feng Kun of the Silicone Oil Department 2, etc. participated in this exclusive interview, which allowed CTA to understand the development, reform results and R&D direction of Honghao Chemical in recent years.
The picture above shows Honghao Chemical Co., Ltd.
HT Fine Chemical Co., Ltd.
General Manager Mr. Fang Weihong
The main application fields of Honghao Chemical's products are: pre-treatment auxiliaries, dyeing auxiliaries, printing auxiliaries, finishing touch auxiliaries, functional finishing agents, garment washing auxiliaries, daily chemical auxiliaries, biological enzyme preparations, etc. Honghao Chemical has six characteristics: high-tech enterprise, customer first, product customization, technological innovation, one-stop service, and multiple business models. It has competitive advantages in the industry:
R&D investment: With technological innovation as the core, annual R&D investment exceeds 10 million yuan.
Transformation of R&D results: 22 high-tech products, 35 invention patents authorized.
International product certification: Nearly fifty products have passed Blue Label certification, nearly a hundred products have passed ZDHC (Zero Discharge of Hazardous Chemicals) certification, and many products have passed OEKO-TEX (International Environmental Protection Textile Association) certification.
Enterprise honors: National high-tech enterprise, Province Textile Printing and Dyeing Auxiliaries (Honghao) Engineering Technology Research Center, Zhaoqing Environmentally Friendly Textile Printing and Dyeing Auxiliaries Engineering Technology Research Center, Province Specialized, Special and New Small and Medium-sized Enterprises.
Talent training: More than 3 million training funds are invested every year.
Management standardization: ISO9001 quality management system, ISO14001 environmental management system, ISO45001 occupational health and safety management system.
Information construction: MES production management system, RFID intelligent warehouse management, ERP management system, Dingjie financial system.
Honghao Chemical, in the course of its corporate development, has introduced digital management for IPD research and development projects, lean production projects, marketing projects, and the financial BI system to adapt to both domestic and international markets and meet customer demands. This has led to the realization of a lean digital production system, continuous optimization of product research and development systems, marketing systems, service systems, and automated upgrade and transformation systems. The company has also increased investment in new research and development equipment, covering areas from raw material testing and analysis to mid-sample testing, aiming to enhance product quality and research and development efficiency. This approach makes the product development process more systematic and rigorous, pursuing excellence.
With the rise of environmental awareness and the strengthening of environmental regulations, green and environmentally friendly products have become the focus of the market. Consumers are increasingly concerned about the impact of chemicals used in the textile production process on the environment and health. This trend has prompted companies to intensify their research and development efforts, participate in various industry certifications, become industry benchmarks, and launch more environmentally friendly and sustainable products to enhance competitiveness. Currently, as the textile industry chain shifts to Southeast Asian countries, especially with the decrease in textile export orders in the first half of this year, the prices of raw materials have fallen across the board. The domestic textile additives market is highly competitive, and the industry is undergoing continuous consolidation. This compels additive companies to continuously strengthen technological research and development, improve product quality while reducing costs, to compete for market share, and closely monitor market dynamics to meet market demands.
Enhance System Construction, Support Brand Development
Branding is a crucial way for companies to distinguish themselves from competitors, and brands with a good reputation and high visibility often represent qualities such as high quality, reliability, and innovation. Meanwhile, certifications have become entry barriers in the textile industry. Building a strong system of textile additives and a brand requires not only providing high-quality products and professional services but also long-term investment and continuous effort to gain a competitive advantage. Certifications, such as the Blue Sign certification, have a significant impact on companies. Both domestic and international customers show strong willingness to cooperate with Blue Sign-certified enterprises, leading to higher customer acquisition rates. Domestic brands place great importance on Blue Sign certification, as obtaining this certification opens the opportunity to enter procurement lists. When dealing with major clients in domestic and international markets, Blue Sign certification becomes a crucial factor for sales representatives in promoting products.
In 2023, Honghao Chemical's partnership with Blue Sign Systems continued, successfully passing the triennial on-site audit. Blue Sign is a sustainable system construction expert from Switzerland, established in 2000. Brands and products authorized by Blue Sign's partner trademark represent compliance with rigorous Blue Sign criteria. The production processes and products adhere to ecological, health, and safety (EHS) standards, minimizing their impact on people and the environment.
The picture above shows the blue label certificate obtained by Honghao Chemical.
According to information received, auditors conducted on-site inspections and evidence collection for Honghao Chemical based on five major standards: resource productivity, consumer safety, air emissions, water emissions, and occupational health and safety. Blue Sign provides an independent and comprehensive audit system for the textile industry, inspecting Honghao Chemical's entire production process to minimize environmental impact and protect human health.
Blue Sign is globally recognized as the most influential sustainable system solution service provider, trusted by world-class apparel and textile brands. Becoming a Blue Sign partner undoubtedly enhances Honghao Chemical's competitive advantage, signifying its commitment to various responsibilities such as environmental protection, social responsibility, and customer satisfaction. Honghao Chemical adheres to the strictest standards by conducting real-time monitoring at production sites, consistently delivering stable and reliable high-quality products, and steadfastly pursuing sustainable development.
In addition to Blue Sign certification, Honghao Chemical has joined the United Nations Global Compact and submits progress reports annually. Operating according to international rules, including compliance with labor requirements, labor regulations, and other customer cooperation requirements, certification signifies effective adherence.
Honghao Chemical has obtained OEKO certification, requiring annual product reviews at the Swiss headquarters. In January of this year, it received the annual OEKO-TEX certificate, upgrading to comply with the ZDHC MRSL 3.0 certificate in April.
Furthermore, in April, Honghao Chemical passed the triennial ISO quality environmental safety management system recertification, and in May, Hongtu Additives passed the annual ISO quality environmental management system surveillance audit. Emphasizing environmental control over products, the company invested three hundred thousand yuan in third-party environmental testing this year.
Honghao Chemical is currently undergoing the GOTS 7.0 organic cotton certification process. This certification is applicable to textiles and is particularly favored in the European and American markets. Honghao Chemical is completing the certification process based on customer requirements from domestic and international markets. The GOTS 7.0 organic cotton certification process is known to be complex and time-consuming. It involves submitting relevant documentation for review, which may take 3 to 4 months. Subsequently, testing is required, followed by scheduling on-site audits, and the certificate is obtained after the completion of the audit.
Lean Production, Achieving the Future
Honghao Chemical's implementation of lean production aims to achieve an efficient, flexible, and quality-stable manufacturing process to meet customer demands and provide greater value. By reducing waste and improving efficiency, companies can gain a competitive advantage in the fiercely competitive market and achieve sustainable development.
Honghao Chemical has a research and technical support team of over 60 people, consisting of multiple Ph.D. holders, senior engineers, and intermediate engineers. General Manager Fang Weihong, serving as the Chief Engineer, actively participates in research and development work. This year, the company invited a consultant team to optimize the R&D process. Fang mentioned that Honghao Chemical's R&D is market-oriented, enhancing efficiency and rigor by introducing IPD projects, reducing unnecessary and repetitive work in the R&D process. As the company grows, the team continues to expand, and to enhance company efficiency and drive reform, they optimize processes to reduce communication costs and improve responsiveness to the market.
According to General Manager Fang Weihong, Honghao Chemical drew inspiration from Toyota's experience in lean production. They streamlined and improved the production process, conducted training, and made improvements in production management. Modules such as 6S and TPM were introduced to make the production system more efficient. In terms of marketing, a consultant team was hired to drive reform, introducing systematic concepts to strengthen management.
These reform measures have positively contributed to improving Honghao Chemical's efficiency and service quality. Each regional market is equipped with application engineers who actively communicate with customers, receiving positive feedback. Previously, sales representatives needed to understand both the product and business, but now application engineers solve customer problems from a technical perspective. Such reforms also facilitate talent recruitment and team expansion.
Honghao Chemical is also exploring the development layout in other industries. This year, the business in the daily chemical sector achieved a 50% growth. In terms of energy additives, the company mainly focuses on flotation aids used in lithium ore beneficiation. These additives are expected to play a more significant role this year, and there is a certain amount of beneficiation business in progress.
It is expected that by 2023, Honghao Chemical's performance growth rate will reach 30%. "The market was sluggish in the first quarter, worse than expected, but the market picked up slightly in March." In order to increase production capacity, Honghao Chemical plans to expand production scale and is preparing for the second phase of increasing production capacity. It is currently in the environmental impact assessment stage and is expected to be in the second half of the year Construction has begun and upon completion, production capacity will increase by 50%. In terms of planning, Honghao Chemical mainly focuses on the Jiangsu and Zhejiang markets, and involves domestic markets such as Shandong, Hebei, Henan, Anhui, Hubei, Jiangxi and Guangxi.
Expand Foreign Trade, Integrate into the“Belt and Road Initiative”
Global markets, especially those in Europe and the United States, are experiencing a decrease in demand due to the impact of inflation. With China currently facing trade sanctions from the United States, some orders have shifted to Southeast Asia, resulting in a significant decrease in exports, especially in regions where cotton exports are hindered. To address this issue, many dyeing factories have relocated their production to Southeast Asia and other areas. This industrial chain migration may become a future trend. In such a market environment, the management of Honghao Chemical recognizes that ensuring their own stability is crucial. Despite the decrease in international market demand, markets still exist and are slowly developing.
This year, Honghao Chemical continues to expand its presence in foreign markets, primarily focusing on blue-label products, achieving a 20% growth in foreign trade. Over a dozen employees have been dispatched to handle international trade affairs, and there are plans to station permanent staff in 3-4 Southeast Asian countries in the second half of the year. For foreign markets, the current emphasis is on recruiting domestic employees, with plans to hire local talent after establishing overseas offices.
In terms of planning and strategy, Honghao Chemical continues to place its development focus on the domestic market, deeply cultivating the Guangdong market and gradually expanding into the Zhejiang market. Simultaneously, substantial financial and material resources are being invested in overseas markets, with a strong emphasis on the Southeast Asian market. The company has participated in exhibitions in Vietnam, Indonesia, Bangladesh, Pakistan, Turkey, Morocco, and other places. The management of Honghao Chemical believes that a thorough understanding of local market demands is necessary for these regions, requiring corresponding strategic planning adjustments.
Equipment Upgrade, Facilitating Research and Development
Honghao Chemical has always upheld a commitment to quality excellence. In order to achieve breakthroughs in product quality and expand its customer base, the company has invested millions in instrumentation and equipment. This includes exploring new types of reactors to enhance efficiency, strengthening process monitoring and data analysis, and increasing investment in testing equipment, such as infrared, gas-phase, liquid-phase, and colorimeters. These advancements raise the bar for testing personnel, requiring familiarity with techniques like spectroscopy to improve product quality and stability.
Honghao Chemical is dedicated to addressing the challenges faced by dyeing factories and meeting future market demands through innovations in energy conservation, water conservation, and process efficiency. The company continually introduces products with outstanding performance and high cost-effectiveness. By investing in talent development and state-of-the-art equipment, Honghao Chemical has carved out its own distinctive features in the market competition. Leveraging the advantages present in competitors, the company continually progresses. Simultaneously, emphasis is placed on differentiated competition in the development of new products, striving for excellence to meet market demands.
Conclusion
Honghao Chemical emphasizes outstanding performance in lean management, product quality, continuous innovation, and digitalization of production systems. The company consistently optimizes processes and adds new equipment. General Manager Fang Weihong believes that there is still significant development potential in the auxiliary industry. Despite a slowdown in overall demand and a decrease in raw material prices this year, the profit margin has improved relative to the previous year, allowing the company to maintain stable development.
In terms of environmental protection, Honghao Chemical continuously invests and adjusts operations in accordance with national requirements. During the initial construction of the new plant, the company implemented wastewater and exhaust gas treatment for all equipment. Having invested in environmental protection for many years, the company has met current demands. Management primarily employs process and digitalized management to enhance efficiency.
With the improvement in living standards, the textile industry continues to experience some growth. Despite a slight reduction in exports this year, the management of Honghao Chemical remains focused on deepening its presence in the textile industry. The company is directing its main efforts into the field of textile auxiliaries while conducting small-scale pilot projects in other industries. In the current situation, the emphasis is on "doing well in ourselves, refining the product system, and improving efficiency."
General Manager Fang Weihong emphasizes the need for continuous learning and improvement, maintaining a positive and optimistic mindset, not getting discouraged in the face of difficulties and setbacks, learning from failures, and growing through them.
He proposes that to excel, one must have a passion that overcomes all difficulties. Passion is a crucial force in overcoming challenges and hardships, being willing to put in more effort and time to pursue goals. This driving force can help us progress continuously, guide us to keep trying, seek breakthroughs and innovations until we achieve the path to success and realize our grand vision!
