Hong Kong manufacturers, who have long made goods for others, are relying increasingly on their own branded products in a bid to revive shrinking profit margins.
Many companies such as eyewear maker Moulin International Holdings eventually plan to quit original equipment manufacturing (OEM) and original design manufacturing (ODM) altogether.
'The middleman role is diminishing. We have seen OEM and ODM gross profit margins drop from 50 per cent five years ago to 35 per cent now,' Moulin chief executive Cary Ma Lit-kin said.
Firms in the name game include eyewear maker Sun Hing Vision, watchmaker Peace Mark (Holdings), power-tool maker Techtronic Industries, and IDT International, which makes electronics under its Oregon Scientific brand.
GK Goh equity research vice-president Renee Tai said: '[Branded products are] one way for Hong Kong manufacturers to protect themselves against price pressure.
'In general, many Hong Kong companies are feeling the squeeze of declining selling prices arising from competition from low-cost places like Southeast Asia.'
But producing branded products presents its own challenges, such as setting up distribution and marketing channels.