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China’s Spectacles Market

I.  Market Overview

  1. China is not just the world's leading manufacturer of spectacles but also the largest potential consumer of such products. According to Euromonitor estimates, retail sales of spectacles in China increased by about 6% to RMB69.9 billion in 2016. Sales of sunglasses showed the fastest growth, registering a 7% increase.

  2. According to a joint 2014 survey by the Ministry of Health and the Ministry of Education, China has a myopia occurrence rate of 33% and more than 400 million of its people are myopic, 1.5 times the world average of 22%. The rate of myopia occurrence in primary schools, junior high schools and senior high schools is 25%, 70% and 85% respectively. China has one of the highest prevalences of myopia in the world and its myopic population is expected to increase by 8% on average annually, suggesting that its potential spectacles market is huge.

  3. As living standards improve, consumers are attaching greater importance to the health and protection of their eyes when choosing spectacles, and increasing numbers of people are buying glasses of higher quality. Consumers are paying greater attention to the ornamental qualities of the spectacles they buy, in addition to their practical functions. The trend to buy bespoke, branded spectacles is increasingly evident. However, market projection suggests that as more consumers become aware of mid-range spectacle brands, the sales of these brands may surpass those of upmarket ones.

  4. The pursuit of greater comfort and individuality by consumers and the on-going specialisation of China’s eyewear industry have led to the rise of the custom-made market. This is seen as the direction for industrial upgrading and brand development. Custom-made spectacles are individually designed to meet the different needs of customers. They are, for example, made in different shapes to showcase personal style or designed to fit the facial contour of the wearer.

  5. Contact lenses: Euromonitor data shows that between 2012 and 2016, consumer spending on contact lenses in China increased at an average annual rate of 9.8%. Retail sales are expected to increase by 4.1% annually over the next few years to reach RMB5.34 billion by 2020, underscoring the potential for further growth in the market. As an increasing number of contact lens consumers want convenience and hygiene, it is expected that sales of disposable one-day contact lenses will have a higher rate of growth than those of traditional ones.

  6. Presbyopic glasses: Statistics show that China is facing the prospect of an aging population. The percentage of people aged 45 and above made up 33% of China’s total population in 2016 and the figure is expected to reach 44% by 2030. Since consumers of this age group have higher spending power and are less price-sensitive, they are more inclined to buy prescription glasses than ready-made ones to correct their vision. This will have a negative effect on the sales of ready-made presbyopic glasses.

  7. Sunglasses: The penetration rate of sunglasses is growing from year to year in China. According to Euromonitor data, sunglasses sales in China increased by 7.2% annually on average from RMB7.1 billion in 2012 to RMB9.4 billion in 2016. Increasing numbers of people are buying sunglasses as fashion accessories to project their personal image.  Many sunglasses brands and luxury brands are expanding their sunglasses series to further stimulate sales.

  8. 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, children have become an important market for the spectacles industry. Also, 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 at the age of 4. With young children – whose eyes have not fully developed – becoming routinely exposed to the blue light emitted from these devices, spectacles with blue light-blocking capabilities have become popular with many parents who want better protection for their children’s eyes.

  9. Growing trend for smart glasses: Smart glasses are wearable computer glasses with an independent operating system that allow users to install their application software and choose their services. They support voice or motion sensor through wireless connectivity. Google’s “Enterprise Edition” that targets the corporate market is an example of this kind. Over 50 big companies, including DHL, Boeing and Volkswagen, are using the “Enterprise Edition”. China’s smart glasses market is growing gradually and Virtual Reality (VR) and Augmented Reality (AR) technologies are used. For example, Lenovo unveiled its New Glass C200 AR glasses in early 2017.

  10. China's imports of spectacles and related products in 2016:

     HS CodeDescription 2016
    (US$ million)
    YoY change
    (%)
    90013000Contact lenses215.545.2
    90014091Sunglasses lenses of glass10.0-35.3
    90014099Other spectacle lenses of glass (except photochromic and sunglasses lenses)2.1-77.1
    90015010Photochromic spectacle lenses of other materials36.414.1
    90015091Sunglasses lenses of other materials63.692.4
    90015099Other spectacle lenses of other materials (except photochromic and sunglasses lenses)187.1-44.1
    90031100Plastic frames & mountings for spectacles85.59.1
    900319Frames & mountings of other materials (including products from endangered animals and non-plastic materials)58.18.3
    90039000Parts for frames & mountings for spectacles55.2-2.8
    90041000Sunglasses301.75.0
    90049010Photochromic spectacles0.1-30.4
    90049090Other spectacles (except sunglasses and photochromic spectacles)39.620.7

    Source: Global Trade Atlas

 

II.  Market Competition

  1. 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 fairly complete industry chains and have developed the industry into a considerable size.

  2. Danyang in Jiangsu, which is considered the main production base of spectacles in China, has become a major eyewear production centre on the mainland. The 2,000 or so spectacles manufacturing enterprises there have a combined workforce of about 60,000 people. The industry grossed about RMB13 billion in sales in 2015, accounting for one-sixth of the national total. With a floor area of 110,000 square metres, the China (Danyang) International Glasses City is an experience-oriented tourism services commercial complex that offers leisure, entertainment and offices, as well as film and TV performances, under one roof. It is the largest spectacles trading market in China and represents a break from the single-trade business model of traditional eyewear markets.

  3. Mayu Town in Ruian, Wenzhou City, Zhejiang, is known as the “town of glasses” in China. It is a major eyewear production base and home to nearly 160 spectacles producers with some 10,000 employees. The first group of spectacles manufacturing enterprises have reportedly moved into the Innovation and Service Platform for Optical Industry and Start-up Park for Small and Micro-sized Optical Businesses in the town. With a gross area of around 210 mu (140,000 sq m), the park will provide production sites and services like brand planning, warehousing and logistics, product promotion and e-commerce.

  4. Shenzhen's Henggang owes its development to the relocation of Hong Kong's spectacles industry. The city is now one of China’s major spectacles production bases with a worldwide reputation for its production of mid- to upmarket branded spectacles. As of 2016, Henggang has over 400 enterprises engaged in the production and marketing of spectacles and produces over 125 million pairs of glasses a year, accounting for some 20% of China’s total production. It is said to be producing about 70% of the world’s high-end spectacle frames, such as plastic, gold-plated or titanium, 95% of which are for export. This makes it an important spectacles export base in China. Optical enterprises in Henggang have been adjusting their business models and concepts in recent years to achieve industrial transformation and upgrading. They are no longer confined to OEM production for international luxury optical brands but go further to establish their own brands. Successful examples include Huaqiang (華強眼鏡)s private label P+US (派士) and Kadin Optical (鎧迪眼鏡)s Faka Wood (珐卡木).

  5. Market share for optical brands is quite scattered in China. According to Euromonitor estimates, the top 10 brands commanded a combined market share of only about 22% in 2016. However, market share is more concentrated for contact lenses, with the seven leading brands controlling 84% of the market in 2016. Major contact lens manufacturers like Acuvue, Ciba Vision and Bausch+Lomb have all entered the China market in full gear. An industry source noted that good quality, high technology content and complete production line are the major advantages of imported brands.

  6. Domestic spectacles manufacturers are becoming more aware of the importance of brand building and technology elements in their products and have started embarking on research and development of core technologies 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 State Administration for Industry and Commerce.

  7. Statistics on the countries and territories from which China imported optical products HS 9003 (frames and mountings for spectacles, goggles and the likes as well as their parts) and HS 9004 (spectacles, goggles and the likes, including sunglasses and photochromic lenses, for corrective, protective and other purposes) in 2016 show that Italy is the largest source.

    Country or territory2016
    Import value
    (US$ million)
    Share of total
    (%)
    Total540.2100.0
    Italy286.653.1
    US38.77.2
    Japan32.05.9
    Germany14.22.6
    Korea9.11.7

    Source: Global Trade Atlas

 

III.  Sales Channels

  1. Wholesale markets are traditional channels for the marketing of optical products in China and there are such markets in every big city. Some of these specialised markets are mainly for domestic sales (such as the Danyang Glasses City in Jiangsu), while some are for export (such as the Guangzhou Glasses City). There are also markets that cater to both.

  2. 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.

  3. Optical shops with an optometrist on site first appeared in China in the early 1990s. Customers can get prescription glasses after an optometry test at these shops, saving time and increasing convenience. These shops are basically developing in the direction of chain operation. Daguangming (大光明), Oriental Vision (東方), Xueliang Glasses (雪亮), Red Star Optical (紅星), Mao Chang Glasses (茂昌), Baodao Optical (寶島), Ming Long Optical (明廊) and LensCrafters (亮視點) are some of the more successful chains. Among these, Xueliang, Ming Long and LensCrafters all belong to the Italian eyewear group Luxottica. Baodao uses artificial intelligence to improve its sales and services, using this technology to inform frontline salespeople of customer data such as spending habits, optical records and eye health conditions, for example.

  4. The rapid rise of the post-90s generation consumers has made the development of online business a priority for many companies. E-tailers of eyewear 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. Online sales reportedly accounted for 10%-15% of total sales in 2016, with online sales channels complementing offline ones.

  5. The O2O (online-to-offline) e-commerce model which combines “offline experience” and “online trading” is gaining ground in China’s spectacles market. However, the way the model is used varies from company to company. A typical O2O model in the spectacles market allows consumers to purchase spectacle frames online at discounted prices while having their optometry tests and prescription glasses in a physical store. The website Myall Eye Wear (麥歐網) run by network technology company Maiou (麥歐網絡科技有限公司) is an example of this. Another O2O model is the collaboration of network giants and traditional retailers, such as the partnership agreement between Dianping.com and Baodao Optical.

  6. The following are some of the optical fairs lined up for 2017 and 2018:

    Date
    Exhibition
    Location
    6-8 Sep 2017China International Optics FairChina International Exhibition Center, Beijing
    18-19 Oct 2017China (Zhengzhou) Optometry ExhibitionTianquan Hotel, Zhengzhou
    5-7 Nov 2017Guangzhou International Optics FairPoly World Trade Center Expo, Pazhou, Guangzhou
    5-7 Mar 2018China (Shanghai) International Optics FairShanghai World Expo Exhibition and Convention Center

     


IV.  Import and Trade Regulations

  1. Foreign companies considering venturing into China's spectacles market should pay attention to 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 the Standardisation Administration of China (SAC).

  2. The General Administration of Quality Supervision, Inspection and Quarantine announced the Administrative Measures on Metrological Supervision of Spectacles on 15 October 2003, detailing the regulations that dispensing opticians must comply with as well as the relevant penalties.

  3. The SAC promulgated 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.

  4. 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 their production, distribution and consumption by end-users. Producers of such devices must obtain a medical device production enterprise licence while dealers should have a medical device dealer licence.

  5. Import tariffs of selected optical products in 2017:

     HS Code Description%
    90013000Contact lenses6
    90014010Photochromic spectacle lenses of glass15
    90014091Sunglasses lenses of glass20
    90014099Other spectacle lenses of glass (except photochromic and sunglasses lenses)20
    90015010Photochromic spectacle lenses of other materials15
    90015091Sunglasses lenses of other materials20
    90015099Other spectacle lenses of other materials (except photochromic and sunglasses lenses)12
    90031100Plastic frames & mountings for spectacles12
     90031910Metal frames & mountings for spectacles6
    90031920Natural material frames & mountings for spectacles10
    90039000Parts for frames & mountings for spectacles6
    90041000Sunglasses6
    90049010Photochromic spectacles16
    90049090Other spectacles (except sunglasses and photochromic spectacles)12

    Source: Customs Import and Export Tariff of the People's Republic of China 2017

Content provided by Picture: HKTDC Research
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