Editor's Note: Amidst profound adjustments in the global trade landscape and the continued unleashing of domestic demand, how industries with a high degree of foreign trade can achieve transformation and breakthroughs by expanding domestic sales has become a crucial window into China's economic resilience. As a major foreign trade province, Guangdong has seen the rise of many industries on the wave of globalization, yet it also faces challenges brought about by fluctuations in overseas markets. Southern Network, in collaboration with the Guangdong Provincial Department of Commerce, launched the "Guangdong Trade Frontline View" series of industry observations, focusing on the transformation practices of Guangdong's highly foreign trade-dependent industries and showcasing the resilience and wisdom of Guangdong's foreign trade sector in overcoming challenges.
Since the beginning of this year, Guangdong has stepped up its efforts in organizing the "Guangdong Trade Nationwide" series of exhibitions to help Guangdong's high-quality foreign trade products expand into the domestic market. Guangdong lighting companies can be seen at numerous professional exhibitions, including the Guangya Exhibition and the China International Building Decoration Fair.
Guangdong is one of the world's largest lighting production regions, accounting for one in every two lights produced worldwide. Leveraging a comprehensive industrial chain, sophisticated manufacturing techniques, and keen market acumen, Guangdong lighting products have long held a significant share of the overseas market, becoming a shining symbol of "Made in China" products going global. Currently, the tariff war has led to increased volatility in overseas market demand, prompting many export-reliant lighting companies to re-evaluate the potential of the domestic market. With the traditional lighting market, the "visible pie," already divided, the question of how to tap into hidden growth and expand new domestic business and channels is driving the Guangdong lighting industry to look inward for business opportunities.
Growth Dilemma: Foreign Trade Under Pressure, Needing a Breakthrough
From strengthening domestic sales to expanding overseas, and then promoting the growth of industrial clusters, the rise of Guangdong's lighting industry is driven by the continuous improvement of domestic and foreign trade integration.
In the 1980s, villagers in Zhongshan's ancient town drew inspiration from lighting products from Hong Kong and Macao, and through handcrafted, family-style workshops, they began to produce lamps, marking the beginning of Guangdong's lighting industry. Riding the wave of reform and opening up, Guangdong's lighting industry opened the door to overseas markets, accepting orders through the "three-in-one and one-compensation" model (processing with supplied materials, processing with supplied samples, assembly with supplied parts, and compensation trade), and began to independently improve and innovate based on demand. Over the past 40 years, with Zhongshan as its center, Guangdong has gradually developed a complete industrial chain spanning lamp housings and internal light sources, from screws and accessories to complete lamp manufacturing, becoming a core global lighting production base.
"Guangdong's lighting industry, especially Zhongshan's, is well-known worldwide. Driven by its brand reputation, the industry's concentration continues to grow," said Qiu Shuai, head of domestic business at Zhongshan Mingcai Intelligent Lighting Technology Co., Ltd. This company, which began with domestic sales, has gradually developed a business structure dominated by foreign trade while simultaneously expanding domestic sales, a testament to the growth of Guangdong's lighting industry.
Today, Guangdong is a major global lighting production region, accounting for over 70% of the national market share and an estimated 50% of the global market share. Zhongshan, with its high level of industry concentration, is known as the "Lighting Capital of China." However, under the new global landscape and industrial transformation, Guangdong's lighting industry is facing growing pains.
From a market perspective, Guangdong's lighting product exports account for approximately 32% of the national total, ranking first nationwide, with Europe and the United States being key export markets. With exports to the United States currently hindered and foreign trade under pressure, companies urgently need to explore emerging markets. From a product perspective, Guangdong's lighting industry has long been stuck in the manufacturing sector, nestled in the middle of the "smile curve." With upstream and downstream design, branding, and distribution channels "external," the industry's added value is low.
From the perspective of market players, Guangdong's lighting companies are characterized by being numerous but not strong. Taking Zhongshan's Guzhen as an example, a Qianzhan Industry Research Institute analysis of the Zhongshan lighting industry reports that Guzhen boasts approximately 38,000 lighting and accessories companies, most of which are small. This can lead to price wars among small businesses, resulting in weak bargaining power.
Securing the Solution: The Industrial Chain and Innovation
Adapting to the changing landscape is crucial; those who are resourceful will prevail. Faced with new developments, Guangdong lighting companies are not waiting for opportunities. Instead, they are proactively expanding into the domestic market, seeking breakthroughs through the advantages of the industrial chain and innovative momentum.
Tu Qiaoling, Secretary-General of the Zhongshan Semiconductor Lighting Industry Association, explained that the lighting industry chain is long, encompassing multiple links, including optics, electronics, and accessories. Companies in Guangdong can find all the suppliers they need for their business in one place. This complete industrial chain ecosystem provides abundant resources and sufficient confidence for foreign trade companies to "join forces to expand their markets."
Zhongshan Darko Optics Co., Ltd. specializes in optical components, with a roughly 50:50 split between domestic and overseas business. "In the past, customers had to individually connect with multiple suppliers for optical, electronic, and component parts for a single lamp, integrating their own solutions. This was not only time-consuming and labor-intensive, but also posed a risk of trial and error," said Xiong Zhe, Sales Director of Zhongshan Darko Optics Co., Ltd. Darko has formed a collaborative alliance with upstream and downstream companies in the industry chain, leveraging their respective expertise to jointly develop customized solutions to precisely meet customer needs.
Although the company's business has experienced short-term fluctuations due to the tariff war, it has generally grown compared to the same period last year. Discussing the impact of the tariff war on the company, Xiong Zhe stated, "The most important thing is to stay calm and focus on developing new business and channels in niche areas."
In addition to the advantages of the industrial chain, the vast potential of the domestic market and the penetration of innovative technologies are injecting new momentum into industrial transformation. As national policies to stabilize the economy, expand domestic demand, and stimulate consumption become increasingly effective, and as policies related to the "Two New" and "Dual Carbon Strategy" policies are being implemented, the lighting industry is poised for significant growth in domestic demand. Emerging categories such as smart lighting and healthy lighting are rapidly emerging, and consumer demand for high-quality, intelligent, energy-saving, and environmentally friendly products continues to grow.
At the 30th Guangzhou International Lighting Fair, AI elements became a frequent new selling point. Lighting control systems that automatically generate desired lighting scenes based on user emotions; smart lighting terminals that integrate remote lighting, call interaction, and curtain linkage; and AI-powered lighting service robots with multimodal interaction capabilities... These innovations are driving a significant leap in industry value.
"There is a consensus within the industry that the future development should focus more on a 'product + service' approach, empowering products with more functionality." Tu Qiaoling believes that these explorations are ultimately aimed at meeting people's needs for a more diversified lifestyle.
Government Platform: Paving the Way for Transformation
The transformation of Guangdong's lighting industry, with a focus on domestic sales, requires a series of precise and effective enabling measures.
As a key channel for businesses to expand their customer base, exhibitions are a key area of government focus. Since the beginning of this year, the Guangdong Provincial Department of Commerce has promoted the "Guangdong Trade Nationwide" and "Foreign Trade Quality Products Tour China" series of activities, supporting the holding of four professional lighting-related exhibitions: the Guangzhou International Lighting Exhibition, the Ningbo International Lighting Exhibition, the Guzhen International Lighting Expo, and the Guangzhou International Professional Lighting Exhibition. This has provided lighting companies with a nationwide display and sales platform, helping them accelerate their expansion into the domestic market.
To address funding challenges faced by foreign trade companies shifting their focus to domestic sales, Guangdong Province has also established a special financing fund for processing trade enterprises, focusing on supporting financing for these enterprises. Lighting companies can apply for related loans and interest subsidies.
In addition, cities with large lighting industry clusters, such as Guangzhou, Shenzhen, and Zhongshan, have also introduced tailored measures tailored to local conditions. Guangzhou has opened a 24-hour "through train" green channel for domestic sales and launched a 100 billion yuan procurement support plan, providing strong support for businesses to expand into the domestic market. Shenzhen is providing subsidies of up to 800,000 yuan for related expenses and, leveraging the "Shenqi e-Trade" AI platform, connecting businesses with 20 million global buyers free of charge, helping them expand their digital customer base. Zhongshan is encouraging businesses to intensify their efforts to expand into the domestic market, organizing at least 100 industry chain and supply chain matching events throughout the year, and allocating special funds to support comprehensive exhibition costs.
From a "global manufacturing base" to "coordinated development at home and abroad," the transformation of Guangdong's lighting industry reflects the wisdom of China's manufacturing industry in breaking through the dual circulation structure. "In the future, we will vigorously promote the 'Guangdong Trade Nationwide' and 'Guangdong Foreign Trade Quality Products Tour China' series of activities to fully help Guangdong companies further explore market opportunities," said a representative from the Guangdong Provincial Department of Commerce.
