Giant Bicycle has been declared "The cream of the crop in small companies" by Forbes Magazine in its third annual list of the world's 20 best smaller companies.
The October 29th issue of the magazine features an article entitled "Tread Ware" that profiles Giant's business success, much of it put down to Giant's CEO and founder, King Liu.
Companies eligible to be considered for the Forbes fingering must be publicly traded, have sales of less than $500 million, and show a record of strong growth in revenue and earnings. Fund managers, entrepreneurs, bankers and equity analysts were polled to come up with this year's winners.
"The grand old names in bicycles...are passe. The future belongs to outfits like Taiwan's Giant," stated the headline in the print version of Forbes Magazine, one of the most influential business magazines in the world.
The top 20 companies are not ranked in order. Other companies blessed with inclusion in the 'top 20 for 2002' list included Carpetright of the UK, and Ducati of Italy.
According to Forbes Magazine, the top 20 have "strong growth prospects, impressive management and innovative products and services...Past performance and the judgment of our sources point to these companies as ones to watch."
Giant is 40 percent family owned. King Liu, 67, founded the company in 1972. It has a market capitalization of $227 million. It has a three percent share of the biggest bicycle market in the world, China.
The company had $425 million in total sales last year. Net profit in 2000 increased 57 percent, to a record $25 million. According to Forbes Magazine, Giant paid a cash dividend (yield: about 2 percent) each of the past two years and "hasn't hit investors with a cash call since 1995."
Liu told Forbes Magazine Giant has no plans to buy ailing rivals or add new marques.
"We want to keep things simple and just build up our own brand," said Liu.
Two thirds of Giant's sales come from its own brands - sold via IBDs only - with the other third coming from contract manufacturing. Giant has had a European foothold - in the Netherlands - since 1996.
This year Giant expects to make 3.2 million bikes in China, nearly two thirds of them for export.
Ian Beasant, sales and marketing director of Giant UK, puts much of Giant's success down to focussing on IBDs:
"In an ever changing market the Forbes report demonstrates that a single brand focused on the IBD sector really can work. Giant are finding that more dealers are looking for long term security in a brand. If the dealer is investing in their future they want a partner that will stand by them. Giant's goal for the forthcoming years is to become the ultimate IBD generalist, delivering high quality along side excellent value. Growth is a gradual thing and comes by focusing on the dealer's needs while at the same time actively promoting the brand.
"For 2002 Giant's product line covers a price spectrum of product from £85 to £3950, within almost all sectors of the market, focussing on fulfilling the Giant dealers requirements and enabling them to be effective in their market place. From an IBD perspective this is an ideal scenario. With the multiples starting to offer wider choice and higher service levels it is vital that the IBD can offer the alternative, can be seen to be different and offer more."