France’s No. 3 smartphone brand Wiko is actually owned by a Shenzhen company called Tinno which sold 14 million smartphones worldwide with an average unit price of US$23, equating to annual sales of US$320 million

April 7, 2014 Leave a comment

Leading French smartphone brand Wiko owned by Chinese company

Staff Reporter

2014-03-25

France’s No. 3 smartphone brand Wiko is actually owned by a Chinese company, reports Huaqiu, the Chinese-language website of the nationalistic tabloid Global Times.

Wiko, which sold 2 million devices in France in 2013, accounts for 18% of the French smartphone market and sits just behind global leaders Apple and Samsung.

Founded in Marseille in 2011, Wiko offers smartphones for between €150-€200 (US$207-$277) and does not require bundled monthly contracts with mobile operators. It takes advantage of a segment of the market that finds monthly contracts of €30-€50 (US$41-$69) and outright phone prices of top brands such as Apple — which sells the iPhone 5S for US$749 — too expensive.

The brand has succeeded largely through its low-price strategy matched with a distinct “made in France” image, but what most people don’t realize is that the largest shareholder of Wiko is a Shenzhen company called Tinno Mobile Technology, which controls 95% of Wiko’s stock.

To maintain its local image, Wiko has 65 French employees but has only four engineers, with the rest all involved in localization of design, marketing, advertising, distributor relations and customer service.

Tinno is said to be an unusual company that was denied a public listing because of its high-risk operations. The Chinese company does not make its own chips, memory or phone screens and relies predominantly on assembling outsourced parts through cheap labor. In the last three years, Tinno recorded gross profits of only 15.09%, 14.3% and 14.99%, with net profits even lower at 5.23%, 6.22% and 6.75%.

However, the company has been able to make up for its low margins with a high sales volume. In 2011, Tinno sold 14 million smartphones worldwide with an average unit price of US$23, equating to annual sales of US$320 million.

 

Filed under Macro Trends, TMT Trends

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