A 40-year-old company received inquiries from Tesla after investing in SEO, or search engine optimization. Even before the digital age had really taken off, the second-generation owner of Shining E&E Industrial (享曆工業) was putting money into e-commerce. Now, the company is selling a little-known product to 60 countries and raking in over a hundred million Taiwan dollars. Half of their sales come from online.

How does a SME (small- or medium-sized enterprise) with more than forty years of history compete in the volatile global economy? By investing in a digital paradigm shift. 

The districts of Xinzhuang, Sanchong, and Banqiao in New Taipei City are noted in northern Taiwan for industry clusters that produce plastic products. More than three thousand SMEs engaged in plastic injection, molding, and machining work together to sell plastic components all over the world, playing an important part in the global supply chain. 

Founded in 1978 and situated in New Taipei City, Shining E&E is one of them. Vice General Manager David Lin (林憲忠) holds up one of his own products, and explains, “Terminal blocks are the bridge between electric wires. Whether it’s the air conditioning of an office building, the lighting system, or the power supply in a factory, they are all connected with terminal blocks.” (Read: The Mystery Woman of Taiwan’s Paper Industry)

Photo by Chien-Ying Chiu/CW

Like many SMEs in Taiwan, David’s father Lin Hsi-Chin (林錫金) started from nothing. Riding on the wave of Taiwan’s economic miracle, the elder Lin made money from plastic injection and metal stamping. Eventually he expanded beyond traditional OEM and ODM to manufacture distribution equipment. Shining E&E specialized in producing terminal blocks for major electronics companies. They set up production in China since 1992. 

What seemed like smooth sailing for the company ran into rough waters more than a decade ago. Coincidentally, this paved the way for David to take over the family business. 

                               

Father Called Him Home to Save the Company

The younger Lin recalls that in 2003, he had just gotten a Master’s Degree from the Department of Mechanical Engineering at Carnegie Mellon University. He dreamed of starting his own business, but his father called him to hurry home.

When he returned to Taiwan the next year, he was shocked to find that the plastic components made by the family business, such as curtains and window blinds, were no longer profitable. 

The American retail giant Kmart had been a major customer. When it went bankrupt and closed a thousand stores, Shining’s sales plummeted. What’s more, Shining only knew the OEM and ODM business model. Its clients decided the price, and it had no means of finding new customers or expanding its market.

“Our customers (traders) prohibited us from approaching brand companies directly. They were afraid of us cutting out the middleman. But this put us at their mercy. We could only compete by lowering our price,” says Lin.

In order to rescue the family business, he turned the crisis into an opportunity. Lin recalled the internet boom he witnessed while studying in America; he sensed a trend. The World Wide Web was breaking boundaries, and the conventional way of doing business was bound to change.

At the time, e-commerce and digital marketing were brand new concepts to Taiwanese companies. For an SME that lacked the resources and means to reinvent itself, the obstacles were staggering. Lin had no choice but to find his own way.

He considered the fact that other major manufacturers of terminal blocks were busy mass-producing products and fighting for big orders from consumer electronics companies. They cut prices and sacrificed profit to try to make a buck. But was there a way to sell small quantities yet greater varieties of highly customized and highly profitable products all over the world through the magic of the Internet?

Early Mover of SEO Sells Customized Products Around the World

“Most manufacturers shy away from small, time-consuming orders. But I adopted a counter-intuitive approach. My objective was to cut out the middleman through e-commerce and make trading more convenient for these time-consuming orders,” says Lin.

It was not easy to transition from a company that passively waited for clients, to one that proactively hunts for business. In the beginning, even making a catalogue was hard. No one in the company knew anything about design, much less possessed the skill set to move the business online. 

Lin taught himself enough to build the company website, studying business-to-business (B2B) e-commerce platforms. From an amateur in the field of digital marketing, he gradually became a bona fide professional. “During the first three years, I knew nothing about exporting, e-commerce, or marketing. I had to spend days and nights researching everything,” he recalls.

After much trial and error, the value of the online orders Shining E&E received ballooned from zero to twenty million, giving Lin the confidence to continue investing. But the various B2B e-commerce platforms kept changing their listing policies. In order to find more potential customers, Lin focused on SEO, or search engine optimization. He also upgraded the official website so that customers around the world could find them through Google more easily. 

Because of this, he spent 500 to 1,000 hours a year optimizing the company’s SEO. He once hired a consulting company to help with the execution, but the results did not meet expectations.

From this he learned: “If the business owner believes that digital transformation is paramount, they must learn it themself. It is not enough to make the decision; they must learn to execute, and lead their employees to follow suit.”

And so he built his own digital marketing team, leading a group of twenty-something employees to continuously improve SEO and the official website. They did keyword research and learned how markets around the world looked for terminal blocks. In this way, he made sure customers could always find Shining E&E very quickly.

The official website is not only in Chinese and English, but also Japanese and Italian—in fact almost thirty different languages in total. This made it convenient for customers in different countries to read the company profile, learn about the products, and place orders. Inconvenient, traditional channels of communication are kept to a bare minimum.

Photo by Chien-Ying Chiu/CW 

Lin says that quelling the customers’ doubts and earning their trust is also an effort that takes a great deal of time. Because of this, he submitted the hundred-plus items on his product line for certification with global safety standards. He even built his own lab to guarantee quality and compliance before sending the products to certification companies, and he puts all the certifications on the company’s official website.  

The digital paradigm shift is an unending process. But if SMEs only know how to manufacture, sitting around waiting for orders to come in without knowing how to connect to global customers through the internet, Lin says, “They are just sitting ducks.”

Rallying SMEs to Digitally Transform and Compete Together

Because of this, he founded the Taiwan e-Business Association (TeA; 台灣網商協會) in 2013. He rallied other SMEs that were in dire need of digital transformation to discuss the challenges and solutions of operating a business on the Internet. In seven years, the TeA has gathered over 140 members from such diverse sectors as manufacturing, service, retail, and others. 

“David often advises us on the direction we should take,” says Eason Jung, vice president of the TeA and sales manager at tw-TCi, also known as Spider Industrial Co. (通產工業).

He reveals that before Taiwanese companies began discussing cross-boundary e-commerce and online marketing, which only happened in recent years, Lin was the first to begin investing, generously sharing his experience with other SMEs through the TeA. He believes that by banding together, Taiwanese SMEs can exert greater influence.

More on innovative digital transformations:
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As for Shining E&E, ever since Lin took over and started its digital transformation, over ninety percent of its terminal blocks have been sold online. Over half of its revenue comes from e-commerce. Customers come from over sixty countries, including such faraway places as Russia, Brazil, and Mexico.

Also, because they focus on producing smaller quantities but greater varieties of customized terminal blocks, some of Shining’s products enjoy profit margins of twenty to thirty percent. This is much higher than that of competitors who mass-produce their products. 

Though Shining is small compared to rivals whose revenues reach into the billions, it is able to reach more new customers through e-commerce. It elevated its brand awareness onto the global stage, so much so that even Tesla came knocking on its door.

Looking back on how he led the family business to reinvent itself, Lin advises, “If the boss is doing it himself, who would dare hold back?” If the business owner is willing to start from scratch and learn something new, then the employees will naturally follow suit.

Shining E&E Industrial

• Founded/ 1978
• Chairman/ Lin Hsi-Chin
• Vice General Manager/ David Lin
• Employees/ Around 100
• Main business/ Manufactures plastic, metals, distribution equipment
• Revenue/ Over NT$100 million in 2019, with more than 50% coming from online sales

David Lin

• Born/ 1976
• Occupation/ Vice General Manager at Shining E&E
• Educational background: Master’s Degree from the Department of Mechanical Engineering at Carnegie Mellon University
• Experience/ President of the Taiwan e-Business Association

Translated by Jack C.
Edited by TC Lin
Uploaded by Sharon Tseng