OEM & ODM Watch Industry in China: Status Quo & Future Outlook

Introduction

OEM and ODM are two common manufacturing models in the watch industry. OEM stands for “Original Equipment Manufacturer”, referring to brands providing designs to manufacturers for production, which are manufactured according to brands’ requirements and bear their logos. ODM stands for “Original Design Manufacturer”, referring to manufacturers responsible for the whole process of product design and manufacturing, with products bearing the brands’ logo in the end.

As the world’s largest watch manufacturing base, China has a large number of excellent OEM and ODM watch manufacturers. They provide high-quality outsourced manufacturing services for international well-known brands, and many domestic brands are born through the OEM and ODM model as well. These Chinese local OEM and ODM watch manufacturers have mature production techniques and excellent quality which earn them a place in the international market.

This article will comprehensively analyze the current situation and future development prospects of China’s watch OEM and ODM market, aiming to enable readers to fully understand this burgeoning industry. The subsequent content will elaborate on aspects including market size, key participants, manufacturing process, market trends, challenges faced and future outlook.

OEM and ODM watch services
OEM and ODM watch services

Table of Contents

Market Size & Key Players

China has the world’s largest OEM & ODM watch manufacturing market, accounting for over 60% of global watch production. The market size measured by revenue reached $8.2 billion in 2022. Although the growth rate has slowed compared to previous years, a steady increase is still expected. Research forecasts that the OEM & ODM watch production in China can still sustain 4-5% annual growth in the next few years.

There are over 3,000 companies engaged in OEM & ODM watch manufacturing in China currently. The Pearl River Delta region in Guangdong province has formed a cluster of quality manufacturers, including:

  • EBOHR in Dongguan, one of the largest OEM watch makers serving global fashion brands like Michael Kors, Guess, Calvin Klein with an annual production exceeding 5 million units.
  • Crown Watch Factory from Shenzhen, an experienced OEM & ODM expert serving over 50 international brands such as Movado, Rado, Tissot with integrated capabilities from design, manufacturing to quality control.
  • Jiasheng Watch & Clock, an ODM watch producer from Guangzhou featuring in fashionable ladies watches with annual export value of $12 million, providing one-stop services for brands like Gucci, DKNY, Swatch, etc.
  • Romlicen, founded in Shenzhen in 2009, an innovative OEM & ODM watch maker specializing in luxury watch production. By adopting cutting-edge automated equipment and lean production principles, Romlicen provides unparalleled precision, craftsmanship and flexibility catering to high-end global watch brands.

With integrated supply chains and skilled talents, these key OEM & ODM watch makers from China have gained trust and partnerships with many global watch brands. Their capabilities and expertise will continue to anchor the strong growth of China as the world’s powerhouse for watch manufacturing.

OEM Watch Manufacturing

Manufacturing Process & Technology

The watch manufacturing process by OEMs & ODMs in China generally involves 5 main steps:

  1. Product Development OEMs & ODMs work closely with brands to turn design drafts or ideas into complete technical specifications & drawings for prototypes. Latest 3D modeling software is used in the process.
  2. Prototype Making Using CNC machines and 3D printers, prototypes are created to test product design, function, accuracy and precision before bulk production.
  3. Pilot Production A small batch is first produced to conduct quality tests and make any last adjustments.
  4. Mass Production Watch parts like dials, straps, cases are mass produced using pertinent machines like automatic turning centers, punch presses, and injection molding machines, before final assembly. Automated equipment improves efficiency.
  5. Quality Inspection QC checks performed using advanced devices ensure consistency in precision, performance, durability of the final watch products.

Incorporating technologies like computer-integrated manufacturing, automation equipment and CAD software etc, China’s leading OEMs and ODMs are ensuring higher quality and precision standards, improved efficiency and cost optimization in the watch making process. Their constant innovation and substantial investments in next-gen technologies also keep strengthening their manufacturing capabilities.

Industry Trends & Growth Drivers

Chinese OEMs & ODM watch makers are actively aligning with major trends influencing current watch consumption demand, which also drives sustained growth.

In terms of popular styles, sleek minimalist watches and light-weight oversized outdoor watches are most in demand by global fashion brands collaborating with Chinese OEM/ODM partners. Eco-friendly materials like wood, ceramics, recycled plastics, etc are also being preferred for modern watch designs.

Wearable tech watches integrating health tracking functions using smart sensors are also seeing heightened interest. Chinese manufacturers like PHEIMU and Teclast have started dedicated ODM services for fashion brands to produce smartwatches packed with fitness monitoring and digital communication features.

Among key growth drivers, expanding global demand remains the pillar for China’s booming OEM & ODM watch industry. For example EBOHR’s export value hit $300 million in 2021, increased by about 30% year-on-year due to surging overseas watch consumption in markets like North America and Europe.

Domestic sales, especially through e-commerce channels, have become another propeller for continuous growth and business diversification for leading manufacturers like Megir and Rossini as rising spends on personal accessories by Chinese shoppers continue.

ODM Watch Production

Challenges Faced by OEM & ODM Watch Makers

Despite strong growth momentum, Chinese OEMs and ODMs in the watch industry also face some pressing challenges.

Rising manufacturing costs pose a major problem. Factors like higher wages, stricter compliance standards, as well as costs of materials and components import make production expenditures jump significantly in recent years. Profit margins are pressed as a result.

Acute labor shortage, especially skillful engineers and technicians is another issue. As talent demand accelerates across China’s manufacturing sector while labor population keeps shrinking, OEMs & ODMs find it more competing to attract and retain expert employees.

Also the unique barriers in overseas expansion cannot be ignored, like glocalization proficiency, varied consumer preferences in export destinations. All of these increase market complexity for Chinese watch manufacturers.

Additionally, fiercer competition aggravates business challenges for ODM players. The rapid development of watch ODM providers in recent years results in excessive production capacity while global watch sales growth slows since 2018. How to upgrade services and capabilities to build leverage amid competition will be vital.

Future Outlook for China's OEM & ODM Watch Industry

The future looks largely promising for China’s OEM and ODM watch manufacturing sector. Market research forecasts its continuous expansion at a compound annual rate of 4% – 5% globally through 2027.

In terms of opportunities, surging new smart watch uptake will become the next highlight. Emerging as a disruptive trend, smartwatches are increasingly incorporated with more innovative functions from mobile payments to health tracking. This creates massive room for OEM and ODM providers in China to tap by offering integrated manufacturing services. Local players like Yacheng Group and Sky Vision are already pioneering ODM production of smartwatches paired with fitness bands and other wearables to complete holistic health management ecosystems.

Sustainability will also grow as an important direction. Consumers worldwide are demanding eco-friendly watch production using recycled and upcycled materials. Related solutions on manufacturing automation and supply chain transparency provided by advanced OEM/ODM producers in China like FIBO Global and WeWood Group can better address the market needs.

However, risks remain in factors like worldwide inflation and consumption decline that could hamper export potentials for Chinese watch manufacturers against the backdrop of global economic slowdown. Continued industry consolidation and FATF’s anti money laundering regulation are also challenges to tackle.

In a nutshell, leading Chinese OEMs and ODMs in the watchmaking sector will continue leading global production given their established strengths in supply network, manufacturing capacity, technical expertise and service diversity. With technology innovation and global partnership, they are on track to achieve steady business scales expansion internationally.

ODM Watch

Major Trade Shows in China for OEM & ODM Watches

A series of major trade shows are held annually across China’s industrial hubs for OEM and ODM watch sourcing. These leading exhibitions connect hundreds of Chinese manufacturers with global brand representatives and importers lookout out for private label partnerships or watch accessory supplies:

  • Hong Kong Watch & Clock Fair (September) – One of the top 3 shows worldwide drawing over 800 exhibitors to showcase finished watches, equipment, components and packaging solutions.
  • China (Shenzhen) International Watch & Clock Expo (April) – Held biannually gathering 500+ companies specializing in watch OEM/ODM services from design, movement manufacturing to quality control.
  • Guangzhou International Watch & Clock Exhibition (July) – A comprehensive show featuring 400+ Chinese factories providing custom watch manufacturing and export services attended by leading brands.
  • Zhejiang International Watch & Clock Expo (November) – Focused on showcasing over 300 quality watch OEMs/ODMs from Zhejiang and surrounding regions.

In tandem with Hong Kong Watch & Clock Fair, the Shenzhen and Guangzhou shows form the golden exhibition circuit for international watch sourcing each year. Plus with cost effective booths and venue spaces, they offer conducive trade platforms for both large manufacturers and specialty factories to tap global partnership opportunities.

Conclusion & Final Thoughts

In conclusion, China has cemented global leadership in watch manufacturing, especially for OEM and ODM production serving renowned international brands. Key competitive advantages like complete industrial clusters, low-cost skilled labor, advanced infrastructure, integrated supply network etc have enabled China’s factories to dominate global watch exports with over 60% market share.

Leading OEM and ODM providers from China are ensuring optimized automation, lean production as well as mastery of cutting-edge technologies like 3D printing, smart sensors integration etc to tighten quality control and improve capacity efficiency. Their constant pursuit of manufacturing innovation will be the key driving China’s future outlook in sustaining world leading capacity and technical expertise in watch production.

Despite pressing challenges in factors like rising operating costs and global economic headwinds, the resilience and adaptiveness demonstrated by Chinese manufacturers will help them lead industry progression. Global brands sourcing OEM/ODM watches can find long-term value in Chinese partners to capture emerging opportunities in new materials adoption, wearable devices integration and sustainability practices etc.

Overall, China’s enabling environment, advanced infrastructure and continuous rise of skilled talents etc will maintain its unparalleled competitiveness and demonstrate great potential ahead as the top OEM and ODM choice worldwide for watch production.

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