JOHOR BARU: Century Bond Bhd is looking at setting up a factory in China to produce household care products for the mainland market.

Chairman and managing director Allan Tan Siew Kim said the venture could take off in one to two years.

"We are going to set up our plant either in the second or third-tier cities there, targeting consumers in the semi-rural and rural areas,' he told StarBiz after the company's AGM recently.

Tan said the company would avoid first-tier cities in China due to intense competition in these areas.

He said the cost of doing business in China's first-tier cities was no longer competitive, unlike 15 to 20 years ago when China was aggressively attracting foreign investors.

He said this had resulted in many manufacturers, including multinational corporations and Chinese companies, to relocate to second or third-tier cities and to countries such as Cambodia, Laos and Vietnam.

Tan said despite being second or third-tier cities in China, the population of these cities was higher than the entire population of Malaysia.

"Chinese living in the semi-rural and rural areas also benefit from China's booming economic growth and many are willing to spend on consumer products,' he added.

He said Century Bond's household care products for the Chinese market would include laundry detergent, fabric softener, floor and glass cleaning liquid, toilet bleach, dishwashing liquid and car -care products.

Tan said the company would also further strengthen and develop its contract manufacturing division by securing more customers in Malaysia and Singapore.

He said it was now doing household care packaging contracts for major hypermarket operators and retailers in both countries.

- TheStar.com