We were honored to interview Joe Chang , the chairman of TWMA to share and his thoughts on the future of woodworking machinery in 2024.
The key points here are as follows:
In the years 2020 and 2021, Taiwan's woodworking machinery industry experienced a compound growth of 54%. However, the period from 2022 to 2023, there was a significant compound decline of nearly 70%. This decline is not limited to the woodworking machinery industry but extends to Taiwan's overall exports, which have been in a continuous downturn for 16 months since March 2022. The persistent interest rate hikes by the U.S. Federal Reserve is a primary driver of the global export recession, compounded by the post-COVID-19 changes in the global economic landscape. These changes include the restructuring of raw material supply chains, the U.S.-China trade tensions, and geopolitical shifts altering the existing model of global production and manufacturing bases.
Additionally, future trends such as net-zero emissions, ESG requirements for businesses, and the growing influence of AI will play a crucial role in the future development of the woodworking machinery industry. Furthermore, the rise of woodworking machinery in mainland China has already impacted the global proportion of woodworking machinery exports (China's exports surpassed Taiwan's in 2008, accounting for approximately 7% of the global export proportions. By 2014, they exceeded Italy's, reaching around 18%. In 2020, China's woodworking machinery exports surpassed Germany's, and it has constituted approximately 26% of the global export proportions in 2023).
Facing these various trends and challenges, the future of Taiwan's woodworking machinery industry requires strategic considerations. In addition to revisiting the suggestions made at the beginning of 2023 (1. Identifying the company’s core values and “niche markets". 2. Implementing effective "knowledge management" extended to "lean management" and "digital transformation". 3. Maintaining a mindset and concept of "continuous improvement" and "customer satisfaction"). I believe we should focus on several key developments:
1. Utilize "digital tools," such as chatGDP, for tasks like drafting development letters, press releases, meeting records, customer visits, and data consolidation. The use of digital tools can enhance the integration of "knowledge management" and reduce the workload of relevant personnel.
2. Integrating "digital marketing" with "physical exhibitions" aims to optimize the marketing processes of "pre-exhibition," "during the exhibition," and "post-exhibition" at a lower cost. While customers may feel more assured seeing physical machines at exhibitions, digital marketing can precisely promote the exhibition, connecting with potential clients and significantly reducing transaction times.
3. Being attentive to trends, policies, and information related to net-zero emissions will enable the company to respond promptly when called upon to act.
4. Addressing the challenges of Taiwan's declining birthrate and labor shortage by collaborating with the government's policies for attracting foreign talent and seeking the necessary expertise for our own companies.
These are irreversible trends. Adequate preparation will better position us to adapt to the unpredictable future, and our collective pursuit should be focused on achieving "high net profit" rather than merely “high turnover."
