Swedish manufacturer of child safety seats, Axonkids AB, has participated at a two-week sales conference in Shanghai at the end of Q1 2015. As previously announced, the company has started a co-operation with a Chinese sales company in order to penetrate the local market where the demand for child safety seats is boosted by recent legislative changes.
Axonkids says that an initial order is due to be delivered in May, with an order value of SEK 320,000. This will be followed by monthly orders according to a previous guidance (Total revenue contribution from China expected to be SEK 13m in 2015). Management expects the big expected sales volume increase from China for the latter part of 2015. Launching a new brand in a rather immature market takes time in order to establish sales and marketing processes. Axonkids, says that it considers its Chinese endeavour to be long-term and while initial start-up costs are expected to burden this years’ earnings, the net effect is still expected to be positive by the end of the year.
During the conference, management also paid a visit to the test facility that will conduct the local tests of its seats, “CCC”. The tests are now firmly scheduled and are said to proceed according to plan.
Axonkids’ CEO Tony Qvist comments:”The conference gave us a positive feeling, as the local team in China has great experience from the industry and they are very serious about this cooperation. It is very pleasant for us to see that they have already put an order in April since this shows that there is interest from the market. I see no reason whatsoever why we should not become successful with the launch of our products in China.”