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VTech Holdings Ltd
18
Review of Operations
Contract
Manufacturing
Services
The Contract
Manufacturing
Services (CMS)
business had
another solid
year, with revenue increasing by
2.0% over 2002 to US$94.7 million
and stable profit.This was a
significant performance against
the overall EMS market.
Andy LEUNG Hon Kwong
Chief Executive Officer,
Contract Manufacturing Services Business
Excellent
services
According to the new study from
Technology Forecasters on 20th June 2003,
the EMS industry recorded a 9% decline in
revenues in the calendar year 2002. Our
results were also well ahead of our
immediate peer groups in Hong Kong
where revenue was reported to have fallen
by 12% over the same period.
VTech’s ability to produce consistently
sound results partly reflects the success of
our strategy of providing quality service to
medium-sized customers, and to expand
through organic growth, only adding
capacity when assured of sustained market
demand. Currently, telecommunication and
professional audio products are the largest
categories we produce.
In addition, our excellent service levels
enabled us not only to retain all existing
customers, but also to acquire new ones.
VTech offers the solid basics of price, quality
and delivery to its customers. Beyond these
we provide with 24 hours-a-day access to
customer service teams, overtime work to
complete orders quickly and a very high
degree of flexibility in accommodating
changes after orders are placed.
Customers also began to benefit from our
new DFX (Design For X) Programme.The
success of our New Product Introduction
(NPI) teams in providing superior service in
the area of new product development led
to the launch of this program, in which we
“design for”various customer parameters,
such as cost or quality, helping to improve
particular aspects of existing products.We
also carried through on enhancements to
our processes introduced in the financial
year 2002, such as implementing lead-free
soldering for our more environmentally
concerned customers.