13 Aug 2019
China’s Spectacles Market
I. Market Overview
China is not just the world's leading manufacturer of spectacles but also the largest potential consumer. According to Euromonitor estimates, retail sales of spectacles in China increased by 6% between 2017 and 2018 to RMB63.8 billion.
China has one of the highest rates of myopia in the world. 50% of people in China are affected by myopia, significantly higher than the global average of 30%. According to a survey by the National Health Commission, the 53.6% of mainland children and adolescents in 2018 suffered from myopia, including 14.5% of children aged six, 36% of primary school students, 71.6% of junior high school students and 81% of senior high school students. This suggests that the market potential for spectacles is huge.
As living standards improve, consumers are becoming more concerned with the health and protection of their eyes when choosing spectacles. As a result, sales of higher quality glasses are increasing. Blue light-blocking spectacles are gaining popularity among office workers who frequently use computers. As well as taking increasing interest in glasses’ practical functions, consumers are also paying greater attention to their aesthetic qualities. The trend towards bespoke, branded spectacles is becoming increasingly evident.
Consumers’ pursuit of greater comfort and individuality, coupled with the increasing specialisation of China’s eyewear industry and the moves towards upgrading and brand-building, has led to the rise of the custom-made market. Custom-made spectacles are individually designed to meet the particular needs of individual customers. For example, they may come in different shapes aimed at showcasing a customer’s personal style or be designed to fit the wearer’s facial contours.
Contact lenses: According to Euromonitor, retail sales of contact lenses in China amounted to RMB8.77 billion in 2018, up 7.5% from the previous year. This figure is expected to rise by an average 6.7% annually over the next five years, to reach RMB12.13 billion by 2023. Many people opt for contact lenses rather than glasses because they are more convenient and comfortable, and carry less risk of injury, when performing physical activities such as sports. Sales of disposable one-day contact lenses are likely to grow even faster than sales of traditional lenses as an increasing number of contact lens consumers opt for greater convenience and hygiene.
Presbyopic glasses: Data from the China Statistical Yearbook shows that Chinese society is ageing. In 2018, 40.2% of China’s total population was above the age of 45, and that figure is expected to reach 44% by 2030. Since consumers in this age group have higher spending power and are less price-sensitive, they are more inclined to buy prescription glasses than ready-made spectacles to correct their vision. This is likely to have a negative effect on the sales of ready-made presbyopic glasses.
Sunglasses: The number of people in China buying sunglasses is growing year by year. According to Euromonitor, sunglasses sales in China reached RMB10.77 billion in 2018, an increase of 7.3% from the previous year. Increasing numbers of people are buying sunglasses as fashion accessories. Many sunglasses brands and luxury brands are expanding their sunglasses series to stimulate sales even further.
Children's spectacles: With more young children being diagnosed as myopic and with more parents willing to pay for high-quality glasses for their offspring, the children’s market has become very attractive to the spectacles industry. Blue light-blocking spectacles for children are also becoming increasingly popular with parents who want to protect their children’s eyes. The spread of smartphones and electronic devices in China has led to almost 67% of children aged six or under coming into contact with electronic products and becoming routinely exposed to the blue light emitted from these devices.
Smart glasses: Smart glasses are wearable computer glasses with an independent operating system that allows users to install applications and choose services. They support voice or motion sensors through wireless connectivity. The Mix Reality app developed by Microsoft combines virtual reality (VR) and augmented reality (AR) to integrate images with the physical world, and allow users to manipulate holograms using gestures. China’s smart glasses market is growing gradually, with Huawei launching the world’s first smart glasses supporting NFC wireless charging. Users can take incoming phone calls and listen to music without putting anything in their ears by connecting their smart glasses with mobile phones.
China's imports of spectacles and related products in 2018:
|HS Code||Description|| 2018|
|90014091||Sunglasses lenses of glass||9.0||53.6|
|90014099||Other spectacle lenses of glass (except photochromic and sunglasses lenses)||1.8||-1.7|
|90015010||Photochromic spectacle lenses of other materials||54.5||25.5|
|90015091||Sunglasses lenses of other materials||54.3||-71.3|
|90015099||Other spectacle lenses of other materials (except photochromic and sunglasses lenses)||181.5||-7.8|
|90031100||Plastic frames & mountings for spectacles||80.0||-2.9|
|900319||Frames & mountings of other materials (including products from endangered animals and non-plastic materials)||80.6||7.5|
|90039000||Parts for frames & mountings for spectacles||55.9||5.7|
|90049090||Other spectacles (except sunglasses and photochromic spectacles)||40.4||21.9|
Source: Global Trade Atlas
II. Market Competition
Geographically, spectacles manufacturers in China are relatively highly concentrated, being mainly found in Dongguan and Shenzhen in Guangdong, Xiamen in Fujian, Wenzhou in Zhejiang and Danyang in Jiangsu. These four clusters all have reasonably complete supply chains and have developed the industry into a considerable size.
Danyang in Jiangsu is considered China’s main spectacles production base. There are close to 2,000 business enterprises in the city involved in manufacturing spectacles and related products. The city’s output of optical lenses and glass lenses is reported to account for 75% of China’s total and 50% of that of the world, making Danyang the world’s largest spectacles production base.
The largest spectacles trading market in China is the China (Danyang) International Optical Center. It is a tourism services commercial complex, with a floor area of 110,000 square metres, that offers leisure, entertainment and offices, as well as film and TV performances, all under one roof. It is very different from the single-trade business model of traditional eyewear markets.
The Danyang Economic Development Zone, together with Wangku Group of Beijing, has established the China Optical Industry E-Commerce Trading Platform. Using big data provided by Wangku, the platform helps companies carry out activities like data sharing and credit verification, in an attempt to boost e-commerce in the optical industry and make it more innovative and professional.
Mayu Town in Ruian, Wenzhou City, Zhejiang, is known as the “town of glasses”. It is a major eyewear production base, home to nearly 160 spectacles producers, which employ about 10,000 people. The Innovation and Service Platform for Optical Industry and Start-up Park for Small and Micro-sized Optical Businesses have opened in the town and, according to reports, the first group of spectacles manufacturing enterprises have already moved in. With a gross area of around 140,000 square metres, the park will provide production sites and services like brand planning, warehousing and logistics, product promotion and e-commerce.
Shenzhen's Henggang owes its development to the relocation of Hong Kong's spectacles industry. After 30 years of development, the city is now one of the mainland’s major spectacles production bases with a worldwide reputation for the production of mid-market to upmarket branded spectacles. Henggang is now home to 676 spectacles companies, of which 495 are production enterprises, and has a total annual output of more than 125 million pairs.
Henggang has become an important spectacles export base in China. It has also been developed as a national demonstration zone for fashionable and branded spectacles. Businesses there are no longer confined to OEM production for international luxury optical brands, but have embarked on technological innovation, research and development, packaging and strategic planning for their own brands. 52 spectacle production enterprises in Henggang now produce their own brands. “Henggang Spectacles” has also been registered as a collective mark.
Market share in China for optical brands is quite diffuse. According to Euromonitor, the top 10 brands commanded a combined market share of just 15.4% in 2018. In contrast, the corresponding figure for contact lenses brands was 39.6%. Major contact lens manufacturers or brands like Johnson & Johnson, Ciba Vision and Bausch+Lomb have all entered the China market. According to one industry source, good quality, high technology content and complete product lines are the major strengths of these imported brands.
Domestic spectacles manufacturers are becoming more aware of the importance of branding and technology in their products and have started embarking on research and development and brand building. As a result, Wanxin (萬新), Porpoise (海豚), Wuliangcai (吳良材), Mingyue (明月), GBV (大光明) and BEST (寶視達) have been granted the title of "Famous Trademark of China" by the Trademark Office of the now-defunct State Administration for Industry and Commerce.
Of the countries and territories from which China imported optical products (HS 9003 and HS 9004) in 2018, Italy was by far the most important, accounting for more than half the value of all such imports.
|Country or territory||2018|
|Share of total|
Source: Global Trade Atlas
*HS 9003: Frames and mountings for spectacles, goggles and the likes as well as their parts.
HS 9004: Spectacles, goggles and the likes, including sunglasses and photochromic lenses, for corrective, protective and other purposes.
III. Sales Channels
Traditionally, optical products in China have been sold through wholesale markets. Every big city has a wholesale market. Some of these specialised markets are mainly for domestic sales (such as the Danyang Glasses City in Jiangsu), while others are for export (such as the Guangzhou Glasses City). There are also markets that cater to both.
The four main types of retail outlets selling eyewear on the mainland are branded chains, professional ophthalmic medical care institutions, bargain supermarkets for fashionable eyewear, and traditional optical shops.
Optical shops with an optometrist on site first appeared in China in the early 1990s. Customers can get prescription glasses after an eye test at the shop, saving time and increasing convenience for the customer. These shops are moving towards becoming chains. GBV (大光明), Oriental Vision (東方), Red Star Optical (紅星), Mao Chang Glasses (茂昌), Baodao Optical (寶島) and LensCrafters (亮視點) are some of the more successful chains. Baodao utilises artificial intelligence to improve its sales and services, using it to inform frontline salespeople of customer data, such as spending habits, optical records and eye health, for example.
The growing importance of post-90s generation consumers has led many companies to make the development their online business a priority. Eyewear e-tailers like Sigo (視客), Yichao (億超) and Kede (可得) have emerged in recent years. Online sales of optical products, especially contact lenses and sunglasses, are likely to become increasingly popular in the near future. Euromonitor data shows that online sales accounted for 9.8% of total optical sales in 2018.
The O2O (online-to-offline) e-commerce model, which combines offline experience and online purchase, is gaining ground in China’s spectacles market. However, the way the model is used varies from company to company. A typical O2O model allows consumers to buy spectacle frames online while taking optometry tests and fitting prescription glasses in a store. An example of this is the Yichao site. Another O2O model is the collaboration of network giants and traditional retailers, such as the partnership agreement between Dianping.com and Baodao Optical.
Some of the optical fairs lined up for 2019 and 2020 are listed below:
|9-11 Sep 2019||China International Optics Fair||China International Exhibition Center, Beijing|
|31 Oct-2 Nov 2019||Guangzhou International Optics Fair||Poly World Trade Center Expo, Guangzhou|
|11-13 Feb 2020||China (Shanghai) International Optics Fair||Shanghai World Expo Exhibition and Convention Center|
|8-10 May 2020||Wenzhou International Optics Fair||Wenzhou International Convention & Exhibition Center|
IV. Import and Trade Regulations
From 1 July 2018, China’s State Council cut most-favoured-nation (MFN) tariffs on 1,449 taxable items of daily consumer goods, including spectacles.
Import tariffs of selected optical products in 2019:
|90014010||Photochromic spectacle lenses of glass||7|
|90014091||Sunglasses lenses of glass||7|
|90014099||Other spectacle lenses of glass (except photochromic and sunglasses lenses)||7|
|90015010||Photochromic spectacle lenses of other materials||7|
|90015091||Sunglasses lenses of other materials||7|
|90015099||Other spectacle lenses of other materials (except photochromic and sunglasses lenses)||7|
|90031100||Plastic frames & mountings for spectacles||7|
|90031910||Metal frames & mountings for spectacles||6|
|90031920||Natural material frames & mountings for spectacles |
|90049090||Other spectacles (except sunglasses and photochromic spectacles)||7|
Source: Customs Import and Export Tariff of the People’s Republic of China 2019
Foreign companies considering entering China's spectacles market should take notice of the relevant mainland standards. An example of these standards is Spectacle Frames - General Requirements and Test Methods (GB/T 14214-2003). For details of the standards, see www.standardcn.com and the website of Standardisation Administration of China (SAC).
On 15 October 2003, the former General Administration of Quality Supervision, Inspection and Quarantine announced the Administrative Measures on Metrological Supervision of Spectacles, detailing the regulations that dispensing opticians must comply with, along with the penalties for not doing so.
The SAC introduced the national standard Ophthalmic Optics and Instruments - Optical Devices for Enhancing Low Vision (GB 23719-2009) on 6 May 2009. This set of standards lays down the optical and mechanical requirements for optical devices for enhancing low vision, as well as the test methods.
According to the newly amended Regulations on the Supervision and Management of Medical Devices, which has been in force since 1 June 2014, contact lenses are classified as Category III medical devices, which must pass safety and effectiveness assessments and be issued with a medical device registration certificate prior to production, distribution and final sale. Producers must obtain a medical device production enterprise licence, while dealers should have a medical device dealer licence.
The National Central Product Classification - Product Category Core Metadata Part 12: Glasses (GB/T 37600.12-2018) came into effect on 1 April 2019. This set of standards applies to the description, coding, database building, query and release of frame glasses product information, and gives a unified modelling language description and dictionary description of the core metadata of glasses.