Text | Viewing the new consumption trend, author | Oscar Wilde, editor | Eucommia
20 billion lighters are sold worldwide each year, and about 70% come from a county-level city in central China. It produces 15 billion lighters annually, which are exported to 120 countries and regions. If they were strung together, they could circle the earth 20 times. This is the legend written by Shaodong, Hunan.
Lighters may seem simple, but in fact they have to go through 12 processes, 32 parts and components, and 15 testing standards. The production involves more than ten processes such as injection molding, stamping, bending, electroplating, and spraying. With such a complex production process, China has achieved a price of one yuan per lighter, and the price has not increased in 20 years. Although the item is small, the extreme cost reveals the strength of China’s manufacturing industry and its strong international competitiveness.
From an unaffordable luxury item to a small item that can be found everywhere, how did Chinese lighters rise, and what is the secret of the Shaodong lighter industry cluster that “ignites” the five continents of the world?
Small lighter, big industry
From ancient times to the present, the use of “fire” has been regarded as a symbol of the birth of human civilization.
The concept of “lighter” can be traced back to the 14th century, but lighters at that time were bulky and not widely used. It was not until the First World War in the 19th century that Alfred Denhill, a young man from London, invented a portable lighter that would not be affected by moisture with the help of a chemist in order to meet the daily smoking needs of soldiers fighting on the front line.
In the 1930s, lighters were introduced from Europe to America. American George Blaisdell pioneered the original structure by changing the pluggable top cover into a flip-closed cover and replacing the fuel methane with cheaper kerosene. The famous Zippo lighter was born.
With the widespread use of American soldiers, Zippo quickly became popular around the world. But at that time in China, most people still used “foreign fire” – matches. Lighters were a luxury that only the rich and powerful could afford, and also a symbol of status.
It was not until the early 1980s that lighters really became common in China. At that time, most of the lighters used in China were produced in Japan and South Korea. Overseas Chinese would choose to bring “hot goods” when they returned to visit their relatives in China, but this metal-shell lighter cost as much as 300 yuan, while at that time, the monthly income of ordinary people in China was basically no more than 1,000 yuan.
At that time, China’s industry was just starting out and the world’s light industry was mainly controlled by countries such as Japan and South Korea, but a businessman from Wenzhou discovered the business opportunity of lighters.
Wenzhou businessman Huang Fajing discovered during his inspection in Japan that, unlike the kerosene lighters sold in China, Japan had already produced disposable plastic lighters.
Plastic lighters are small in size and very light in weight. They do not require refilling with kerosene and are relatively cheap. Huang Fajing bought a few and brought them back to China to study them. By disassembling them and analyzing the materials of the parts, as well as the tools and processes required for assembly, he soon discovered the “secret” of the lighter.
When Huang Fajing was 36 years old, he founded Rifeng Company, which mainly produced lighters that imitated Japanese ones. By abandoning unnecessary parts or replacing them with cheaper materials, Huang Fajing greatly reduced the production cost of lighters, and the selling price was only 1/10 of the price of Japanese lighters.
As a result, lighters became available to everyone, and the lighter market in China became hot. Wenzhou lighters broke the monopoly of Japan and South Korea on the international market. In the 1990s, lighter manufacturers sprang up like mushrooms after rain, and Chinese lighters began to be exported overseas.
Data shows that at its peak, there were more than 3,000 lighter manufacturing companies in Wenzhou, with an annual output of 550 million lighters and a production value of 6.5 billion yuan. Their products were exported to Japan, South Korea, Europe and other places, accounting for 80% of the global and 95% of the national market share, making it a veritable world lighter production base.
At that time, the lighters produced by some Wenzhou manufacturers were comparable to those of international brands in terms of quality. Many world-renowned lighter brands placed production orders with Wenzhou manufacturers, including Bic and Dupont.
But this grand occasion did not last long. In 1994, European and American countries, led by the United States, began to use the CR Act to impose brutal sanctions on Chinese lighters, which is also the most notorious act in the history of the lighter industry.
The CR Act mainly includes two points: first, toy lighters are not allowed to enter the European market; second, lighters priced below 15 yuan need to be equipped with child locks. These two regulations are very specific and are aimed at lighters made in Wenzhou.
It is not difficult to add a child lock to a lighter. The key is that all lighter manufacturers in Wenzhou do not have the patent to sell child lock lighters. If you want to add it, you must purchase the relevant patents from Europe, but then the cost advantage of Wenzhou lighters will no longer exist.
Although the EU announced the withdrawal of the CR Act in 2004 due to the continuous efforts of Wenzhou businessmen such as Huang Fajing, the so-called CR Act was written into the relevant testing act by the EU only one year later. In addition, affected by the financial crisis, the entire lighter industry fell into a state of low profit, many companies went bankrupt, and the number of lighter manufacturers in Wenzhou dropped from more than 3,000 at its peak to 100.
Three small counties’ lighters “dominate” the world
While the lighter market in Wenzhou was declining sharply, the lighter industry in Shaodong, Hunan, thousands of miles away, was igniting a spark.
Shaodong locals have a catchphrase: “Shaodong produces 15 billion lighters a year, which can be strung together to circle the earth 20 times.”
Shaodong is located at the junction of Shaoyang, Hengyang and Loudi in Hunan Province. It is a county-level city with an area of about 1,700 square kilometers and a permanent population of about 1.04 million.
Shaodong’s natural conditions are not good. Hilly land accounts for 61.18% of Shaodong’s total area, mountainous land accounts for 21.69%, and plains are mostly valley plains, accounting for only 10.85%. The first paragraph of “Shaoyang County Annals” mentioned that Shaodong has 0.63 mu of arable land per capita, “the lowest per capita in the province.”
The inherent lack of arable land resources has created the character traits of Shaodong people who are daring and hardworking, and they are good at doing business. When the spring breeze of reform and opening up blew across the land, Shaodong people carried small commodities such as buttons, toothbrushes, and small hardware from village to village, and gradually spread to the whole country. In 1986, Shaodong already had 13,600 households with an annual income of 10,000 yuan. From 1996 to 2000, Shaodong’s GDP ranked second among counties in the province, second only to Changsha County.
In 1992, Yao Hanyun, a native of Shaodong who started his business in hardware and cloth business, saw that people from Wenzhou were doing well in the lighter business and he also had an idea. He took out all his savings and founded the first lighter factory in Shaodong – Shunfa Lighter Factory.
The booming business of Shunfa lighters attracted other people from Shaodong, and they set up lighter factories and workshops one after another. Shaodong’s lighter industry began to grow rapidly.
In 2000, a major explosion occurred at a fireworks factory in Jiangmen, Guangdong, and Guangdong banned lighter factories. After that, the country gradually improved the Labor Contract Law, and the lighter industry was also shaken.
The transfer of a large number of laborers and the closure of a large number of Wenzhou lighter factories have given Shaodong more opportunities. Under the leadership of the government, Shaodong’s lighter industry began to integrate and formulated a series of supporting policies to give full play to the advantages of local labor, taxation, and industrial chain, thus achieving industrial upgrading.
In 2002, the Shaodong Lighter Association was established. With the support of the government, most of the “small, low-end and scattered” lighter companies were integrated together.
Shaodong’s lighter merchants realized that they needed to regulate the industry while expanding their business. In 2007, 13 lighter export companies in Shaodong jointly established the Lighter Export Supervision Committee, which formulated specific standards such as unified pricing, quotas, transportation, insurance, and seeking government support policies, which to a certain extent reduced the occurrence of disorderly competition. They also jointly invested, integrated scattered resources, and developed and designed molds.
In 2008, Wenzhou’s lighter industry declined, while the number of people working in Shaodong’s lighter industry was approaching 200,000.
(Source: Dongyi Electric official website)
In June 2009, 10 local lighter export companies and 4 supporting companies in Shaodong cooperated to establish Hunan Dongyi Electric Co., Ltd. in Shaodong Ecological Park for the purpose of industrial upgrading, integrating R&D, production, sales and transportation. It quickly grew into a leading company in the industry.
According to the official website, Dongyi Electric has 210,000 square meters of standardized production plants, a professional mold R&D center, 98 automated production lines, and 300 sets of advanced injection molding equipment. In 2020, the company’s products in 8 series and more than 100 varieties were sold to 86 countries and regions around the world.
In 2012, Shaodong’s annual lighter production exceeded 10 billion pieces. In that year, Shaodong’s export volume exceeded that of Wenzhou, Ningbo and other cities for the first time, becoming the region with the largest lighter export volume in the country.
According to statistics released by Changsha Customs, in 2022, Shaodong exported 3.52 billion lighters, accounting for 50.1% of the country’s total lighter exports during the same period, ranking first in the country.
In the list of the top 100 manufacturing counties (cities) in China in 2022, Shaodong City, Hunan Province, ranked 92nd. The lighter industry has contributed greatly to this ranking. Together with the luggage, hardware and other industries, it has supported Shaodong’s GDP.
At present, there are 114 lighter production and supporting enterprises in Shaodong City. In 2023, the Shaodong lighter industry will achieve a gross output value of 10.5 billion yuan and a total profit and tax of 560 million yuan, accounting for 70% of the national market share. Its products are exported to more than 120 countries and regions.
China’s smart manufacturing behind the one-dollar business
Compared with Wenzhou, Shaodong’s lighters are more imaginative because they only cost 1 yuan and have not increased in price for 20 years.
In addition, unified standards, unified pricing, unified sales, and unified management have made Shaodong’s lighter industry more cohesive and also made it the “Lighter Capital” it is today.
How strong is Shaodong’s lighter industry cluster? Behind a lighter company, there are often hundreds of supporting suppliers. 216 types of lighter accessories and 14 processing technologies can all be locally supported in Shaodong within a radius of 20 kilometers. Looking around the world, this may be the only place like this, which is also one of Shaodong’s trump cards.
According to the latest Shaodong lighter industry map, 10 towns (streets) are responsible for different industrial supporting links in the lighter industry chain, forming multiple industrial clusters such as high-end machines for the international market, domestic sales machines, design and development, packaging and printing, etc.
The clustering effect brought about by the complete industrial chain has also reduced the labor cost of each lighter from 10 cents to 1.5 cents, which has achieved extreme cost control while raising the industry’s entry threshold.
In recent years, Shaoyang has been committed to building a highland of advanced manufacturing, and Shaodong has continued to promote the automation transformation of “machines replacing people” in the lighter industry. The injection molding machines have been replaced for three generations, the welding machines have been replaced for three generations, and the inflators have been replaced for five generations… Under a series of measures, the per capita efficiency has increased by 30 times, which has also become Shaodong’s second trump card.
Shaodong not only has a professional manufacturing cluster that keeps costs down, but also has a strong coordination organization. Today, in Southeast Asian countries, Vietnam, Bangladesh, Indonesia and other places, lighter production lines have been established, basically all of which are run by Shaodong companies, but R&D and infrastructure support are still in China.
In Shaodong, an average of 28,000 lighters roll off the production line every minute, and its lighter production technology is constantly innovating.
According to the People’s Daily, in recent years, Shaodong’s lighter industry has continued to promote technological innovation and process transformation: designing new lighters, introducing 3D printing technology to make models; installing automated welding equipment for the most difficult welding process; and using machine vision technology to install lighter gears… More than 10 leading lighter companies in Shaodong have basically achieved full automation of 12 processes, and their process technology is leading the country.
The lighter industry has grown from a small scale to a large scale, which is also inseparable from the active guidance and policy support of the government. At present, Shaodong’s lighter industry has 3 national innovation platforms, 8 provincial innovation platforms, more than 1,000 R&D personnel, an annual R&D investment of 200 million yuan, and has accumulated more than 3,000 scientific research results, with an annual product innovation rate of 38%.
Data shows that in the first half of this year, Dongyi Electric’s market orders were booming, with output value increasing by 25.4% year-on-year and exports increasing by 4%.
From initial imitation to catching up and then dominating the world, the lighter industry is only a small branch of “hardware”, but behind it is the powerful advantage of Made in China. From manufacturing to intelligent manufacturing, low-end labor-intensive industries are continuously empowered by science and technology to develop into technology-intensive industries. The lighter industry is constantly becoming intelligent, high-end and green.
Windproof and explosion-proof lighters, household kitchen lighters, USB rechargeable cigarette lighters…the flame from China continues to light up the world.
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