As far as human history can go back, body lotion and fragrance are an integrated part of everybody's lives regardless of sex. The desire to smell good has fostered a cosmetic body-care industry that runs as far back as the beginning of the human race. In modern days, cosmetic/body-care items have become part of a multi-million dollar industry that often creates as much value as high-tech sectors. To prevail in such a large and often competitive business, a touch of genius is often required, as in the case of Well-Pack (H.K.) Co.

Established in 1983, Well-Pack (H.K.) Co. started off as an agent importing cosmetic bottle-parts into mainland China. Building on such foundation, the company has eventually grown into a body-care/cosmetics business complex with an over 15,000 sq. meters factory, office and research facility located in Hudua of Guangzhou, Guangdong, China. The facility (St. Eva Fine Chemical Co. Ltd.) houses the company's major production lines and product research laboratories. In fact, the company has now concentrated most of its operations (excluding administrative, financial and R&D functions) into the China plant.

According to Mr. Allan Yeung, general manager of Well-Pack (H.K.) Co., the company has gone a long way in reaching the current standing. "When we first launched in 1983, we didn't operate our own production facilities. In fact, we were simply agent representing foreign fragrance, spray pump and cosmetic bottle makers in China. After further market liberation, however, our business faced very stiff competition, and very soon there was over-supply in the market which drove the price downward even further. To diversify our nest, we decided to launch our own production in Hudua of Guangzhou. At first, we concentrated on body spray and perfume. After two years of adjustment, we believed that we could take on more, so we went into make-up items and later into bath gift sets."

As a producer of general merchandise, Well-Pack had realized the importance of quality in its early years. Allan Yeung emphasized, "In fact, we understood early on that we couldn't rely on cut-throat competition. As a Hong Kong-based company, we were not able to leverage cost factor over mainland counterparts. To gain a solid market standing, we did need to work out some gimmicks, as well as unique prototypes for clients' choices. Moreover, we also developed our own gift varieties, like bath items, or mini-champagne style lotion."

Due to the ever-increasing cost advantages of mainland rivals, Allan Yeung believed that the quality factor is even more important than ever, "Bath sets compete mostly on cost, and I as a Hong Kong-based producer can't possibly out-gun my mainland competitors on endless cost-cutting. Therefore, I need to leverage on our designs and production expertise, and to focus on improving quality. This is also the reason why we undertake our own production. I feel confident that my company is moving in the right direction, as we have been expanding fast in the past two or three years, with a few folds of jump in production capacity."

After almost 20 years of continuing expansion, Well-Pack has well-rooted in the world's largest consumer market-the United States. Other than the American market, Well-Pack also sees its reach as far as United Kingdom. "Most of these items go to large grocers or department stores, like Wal-Mart, Kmart, Family Dollars, Dollar Tree, etc," said Allan Yeung.

To develop a robust market foundation, Allan Yeung said the company has been adopting a strategy of working through domestic agents to reach its final clients. Allan Yeung explained, "We work chiefly with domestic importers. They have a strong knowledge of their local markets, as well as close relations with major chains there. Of course, we may move directly to deal with the chains some days, but for the moment, we are still working with local importers and participating in local trade shows."

At present, this strategy has obviously served the company well, as it has to expand its production capacity rapidly, especially in the perfume business. Allan Yeung said proudly, "We are constantly adding new lines every year. In the past 8 years, we had accumulated over 30-40 perfume types. To cope with the growing demand, we now have two to three production lines fully devoted to perfume manufacturing."

"When working on perfume items, all industry insiders know that one can't compete on the ingredients alone. There can't be too many variations in terms of what you have in the liquid, so we instead work on bottle designs to add extra value and new surprises."

"My vision is that gift-giving should not be confined to specific festive occasions. I would like to make gift-giving an activity that can go on for 365 days throughout the year. You can present bath-sets or perfume as items of good will to people when you see them fit, not just as a gift giving out during the Christmas days, for example. We have now developed everyday and seasonal gift items, too."

In order to satisfy such diverse and wide market spectrum, Well-Pack also needs to develop designs that match different tastes. "In the U.S., the dollar-shops are important, as they often order in very large quantities. For one item, the quantities can easily run up to 700,000 to 800,000 sets, with USD$1 paid for each set," remarked Allan Yeung.

To cater for diversified markets, Well-Pack is working aggressively on new designs and new undertakings. For the past trade shows, the company was reportedly rolling out an average of 100 new items per fair. On average, the company turns out at least 15 new bottle versions per design in a year. All designs are the brain-children of Well-Pack's in-house design team. "For each design, we are going to work out at least 10 varieties. Each one of our bottle design will be accompanied by 15 new versions. I believe that due to close similarities, working on ingredients alone will only add to your cost, while a new and better bottle design will always bring more appeal," said Allan Yeung.

"It is more important than ever that we need to work out new designs. The gift-pack industry started off not very long. In fact, it was first initiated by major cosmetic and body-care chains like the Body Shop, as a way to sell off their outdated items in packs. 6-7 years ago, buyers might conclude a deal on cost terms alone, but it is not so now."

Other than the North American market, Japan is also a potential sales spot for Well-Pack. "The Japanese, unlike the Americans, request small and delicate bottle designs. They are hard bargainers, as they have a very high demand on product quality. Even so, they are willing to pay top-dollars for orders. Once they forge a partnership with you, they will stick to you thereafter. In this aspect, it's really worth one's effort to try to cultivate relationships with Japanese clients," Allan Yeung explained.

In the meantime, Allan Yeung revealed that Well-Pack's most popular designs include mini-champagne shapes bottles, small bucket-shapes designs, and a time-capsule style designs which is still in research stage. This research stage is most important according to Mr. Yeung, as Well-Pack adopts the strategy of matching bottle designs with specific smells. He remarked, "We need to draw people to smell before we can convince them to buy the product. After all, good designs, not the smell, are what really attract people to our counter during trade fairs."

Well-Pack is still conceiving new blueprints for clients' choices. One of its latest ideas is a jig-saw bottle design, consisting of bottles which can be put together like a giant jig-saw puzzle. In addition, the company is also working on beer-shape bottles, so as to retain old clients as well as to develop new clients.

Other than working with local agents and importers, Allan Yeung said that the company does not consider rushing to promote its own brand at the moment, nor will they go into markets other than the US and Japan. He explained, "The low-priced retail market in the U.S. is still expanding. For chains like Wal-Mart, it is very common to have several thousand chains at a time. In contrast, we shall not consider markets like South Africa or the Middle-East at the moment, not because of the purchasing power factor, but due to the lack of gifts and gimmicks buying and giving culture in these countries."

In the long run, Allan Yeung said the company's prime focus will be still on new bottle designs and the good packing. He revealed, "We are looking to launch another waves of new designs at the upcoming Kenfair's exhibition this October. As for the puzzle design, we may even put up a puzzle wall by then."

"Concerning the product lines, we continue to focus on our own core competencies-bath and body lotions, as well as cosmetics."

   

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