by Mike C. Lee on March 28, 2009 – I recently had a chance to sit down and have a one-on-one chat with Integy CEO Arthur Tsui. There was lots to talk about, and he answered questions about, among other things, r/c hobby, Integy products, and competition with emerging new hop-up part suppliers. Quotations below are based on my notes and roughly accurate.
I asked Arthur about his view on the hobby in general and the state of the hop-up part business. Arthur said that the company has been in business for 16 years and they have seen the ups and downs with market fluctuations. In general, though, he says the most important part of the hobby is that people must be able to enjoy the process of learning, building and tuning their r/c models.
“It’s about having fun while learning how to build your models from ground up. Building, customizing, tuning and experimenting is what the hobby is about. You’ll feel good about the final result, you’ve made it work! If you want just toys, you can get them from Toy”R”Us. All the available RTRs are great ways to get people started, it’s imperative for customers to understand r/c models are not toys. “
I asked Arthur if he thinks the new RTRs coming out are getting better and the demand of aftermarket parts is reduced. His response is that it’s related to the recent economic slow down and people are getting the more affordable 1/10 electric vehicles. They have actually seen a substantial quantity increase in aftermarket part sold compare to 2008.
“The various short course trucks are excellent examples of what the general population wants, the mfg. perfected their RTRs but customers are still looking for ways to hop-up their trucks. Isn’t it boring running the same thing like everyone else? There is always a way to improve performance, our customers also want to customize their vehicle because they want to be different!”
I asked Arthur about Integy’s rumored efforts to double their production output. Arthur confirmed that Integy was investigating the possibility of launching up to 10 new vehicles by 2010.
“Our partners and developers are constantly working on new projects, we’ve planned closed to 800 new hop-up parts and a brand new line of vehicle. This year, our focus is on getting our engineers to become more creative and the new designs must handle the most demanding running conditions. New software is in place to test designs earlier in the design cycle, on-screen and against real-world conditions. This can lead to improved design quality and manufacturing efficiency, while reducing time to market, costs, and materials waste. The amount of stress each r/c component has to endure is amazing, we need to have stronger and more reliable hop-up parts.”
Revenue and Competition
This was the one topic where Arthur was not very forthcoming. He wouldn’t talk about specific revenues but he said that over 85% of their products are sold through local hobby shops. He also said that the company sales through their distributor network is doing very well, both in the U.S. as well as internationally.
“It’s surprising how much money comes in internationally, r/c is now getting popular in many other countries. We shipped a lot of packages to Canada, Japan, Australia, U.K., Germany and all over Europe”
We are always going to win and lose business, this is just a fact of life in business today. As much as we would like to win all the time, it is not the reality in the world. Sometimes your business is not a fit for the needs of the client. I asked Arthur about all the negative comments on r/c forums and he said Integy is a target of several smaller emerging companies, they lack the proper advertising funding and use all the online forums to their advantage.
“It’s like a game but if the only way you can talk about your company or your products is by bashing another’s, what you actually broadcast is that you don’t have many beneficial things to say about your own. When the little guy attacks the big guy, it tells me that the big guy must be kickin’ your ass – and for a good reason. And when the big guy attacks the little guy, it tells me that they must be eating into your share of the pie for a reason, so I should check them out”
I asked Arthur what he thinks about the online forums and he said some of the accusations and speculation were true and some weren’t. Arthur also said that different products are made for different customers, people should change their one size fit all mentality and all the successful companies are here to stay in the long run.
“We love critics, sometimes they leave nasty comments but they are the ones who help us grow. We couldn’t be where we are at today without all their inputs. Healthy competition is good, consumers will benefit in the long run and the properly managed businesses are here to stay. It’s interesting to go through old issues of XRC, flipping through the June and July 2001 issues and all the top companies are still around.”