Liyang, China -- Chinese thermoplastic elastomer maker Top Polymer Enterprise Ltd. is investing $15 million in a factory near Atlanta, its first outside China, as it makes a bigger push into the U.S. market.
The 60,000-square-foot facility, in Social Circle, Ga., will have three compounding lines with an annual capacity of 16 million pounds. Top Polymer has two compounding factories in China and plans to have the U.S. site operating by May 2019.
CEO Marcus Tsong said the company is targeting $10 million in sales from the Georgia plant in three years, which he called "not an ambitious target."
About 80 percent of the company's current business is in Asia, but Tsong said many of its customers are headquartered in North America and Europe, and exports are growing.
"When you look at our global market, our biggest market is in Asia Pacific, whereas North America is second," he said in a recent interview at the company's factory in Liyang, about 150 miles west of Shanghai.
"Right now, our sales in North America haven't reached 20 percent of our income," he said. "Our expectation and plan is that the North American market will grow to 40 percent of our sales."
The company employs 150 at its China factories, in Liyang and Dongguan, and plans to have 70 on staff in Georgia, where it will initially make elastomeric compounds based on styrenic block copolymers and thermoplastic vulcanizates.
"We see the U.S. as the major market for the high-end applications," the company said in a statement.
Top Polymer also makes thermoplastic copolyesters and thermoplastic urethanes, and has production capacity in China of 56 million pounds, with 13 compounding lines.
Tsong said the decision to expand internationally was three years in the making.
An expanding customer base
"After 14 years developing, we're now ready to serve our clients all over the world," he said, noting that the company looks for staff with a technical background in all jobs, including marketing and sales.
The company started in 2004 in Dongguan and opened the Liyang facility in 2008 in Jiangsu province, about 150 miles west of Shanghai.
It started out supplying TPS materials to the oral care market and focused on China, and about 60 percent of its business remains in China.
But with the company's customer base expanding -- with an estimated 500 customers and exports to 30 countries -- as well as increasing localization among its customers in the auto industry, Tsong said it was the right time for an expansion to North America.
It needs to be closer to those markets, he said: "The characteristic of our industry is that we focus on our clients more. We are required to react by providing service immediately."
Being in the U.S. market will help with new product development, Tsong said.
"The speed of information exchange and product upgrade is very fast," he said. "When it takes 17 hours to fly from China, it's not fast enough."
The U.S. operation, called Top Polymer Enterprise LLC, will be lead by President Ralph Stone.
Tsong said the company visited many places looking for a site for the U.S. factory.
"We visited five states, went to Cleveland, Ohio; Indianapolis, and decided to go with ... Georgia," he said. "We are happy with its location and climate. Also, their tax policy is the most satisfying one to us as well."
He found local governments in the United States interested in Chinese companies: "Different states in America are keen [for Chinese investment] and they set up specialized teams in China or Asia Pacific to attract them."
Tsong said the company has other international sales growth in mind. The company is very interested in India and the rest of South Asia, where it currently does not export, he said. Tsong recently visited Pakistan to survey that market.
"We've been watching the growth in the Indian market in the past two years," Tsong said. "For the moment the Indian market grows quickest in our industry. We have zero export to the Indian market at the moment, but it grows really quickly."
Its main end markets are automotive, electronic, packaging, consumer and medical.
