Guanhao stays ahead of the paper curve

Guangdong Guanhao Hi-Tech Co, one of the country's biggest specialty paper manufacturers, is leading the way with its technological transformation.

Established in 1993 in Zhanjiang, Guanhao is one of the city's pioneers in manufacturing automation after importing equipment from Switzerland, France and Finland. To further increase productivity and expand capacity, it upgraded its production lines with advanced equipment, such as semi-automatic packaging machines in its new base on Donghai Island.

"The key to Guanhao's success is innovation, keeping up with changes in the market and developing new products," said Wu Chonglan, Guanhao's production director.

Guanhao spends at least 3 percent of its annual sales revenue on research and development and acquires two patents a year on average, Wu said.

The papermaker began by producing carbonless copy paper for vouchers. It is the only provider of anti-counterfeiting carbonless paper used for tax invoices nationwide.

In 1999, it developed thermal paper with anti-counterfeit technologies that is currently used in faxes, invoices and lottery tickets. The company said it has a 70 percent market share of the paper used for lottery tickets in China.

When the online shopping craze brought about rapid growth in the shipping and delivery industry and a surge in the demand for delivery vouchers, Guanhao had a swift response.

It developed a new product, adhesive thermal paper, in 2005. Improving the sensitivity and resistance to scratches, the product is widely used for logistics barcode labels and airline luggage labels and boarding cards.

The new product soon became popular and market demand has since risen despite a decline in the demand for carbonless copy paper. Because of the increasing popularity of the adhesive paper, Guanhao has seen a year-on-year growth of about 7 percent through the first seven months of this year.

Even as electronic vouchers became more popular, the company adjusted by developing new products such as thermal dye sublimation paper that is used in textile dying and outdoor advertisements, she said.

"Besides developing new technologies and products, Guanhao has completed its industry chain," Wu said.

It built a plant for producing base paper in 1999 and no longer imports base paper from Japan.

"Producing our own base paper saves on costs. With this, we can make any size according to customers' demand," Wu said.

In 2013, Guanhao acquired a large printing firm for delivery vouchers in Zhuhai.

"We are optimistic about the logistics and delivery industry given the boom of e-commerce," she added.

At least 80 percent of Guanhao's products are sold in the domestic market. Now it wants to venture out into overseas markets, especially North America.

Guanhao's products were sold in the United States through local dealers before 2008 but had to exit the market because of punitive tariffs placed on thermal paper imported from China.

Guanhao established a sales office in New Jersey last year, looking for opportunities to re-enter the US market.

"North America has a large demand for the kinds of specialty paper we make and if we make it in this market, it will be a great encouraging example for our export businesses," said Li Dongming, a sales manager of Guanhao, adding that the US sales office is still carrying out market research.

"The Chinese currency is depreciating, which is beneficial to exports in the long term. But Guanhao never uses low price as a selling point because our products are high-tech and of high quality," said Wu.

xujingxi@chinadaily.com.cn

Guanhao, one of the country's leading specialty paper manufacturers, is looking to revamp its manufacturing equipment and innovate other technologies. Provided to China Daily

Paper products are ready to be delivered to domestic and overseas markets. Provided To China Daily