Avery Dennison, a leading company in labeling and packaging materials, plans to boost its sales network in China by setting up more distribution centers in the next three years.

"The plan aims to sharpen its competitive edge for a bigger market share in China," said Jimheng Lee, the newly appointed vice-president and general manager of Avery Dennison Labeling and Packaging Materials in China.

"We have finalized a three-year strategy to reinforce a market-oriented effort to push forward the company's development on the Chinese market," said Lee.

The company is expected to add three to five distribution centers, which might be located in Central China and Northeast China.

"Our national sales network in China should be reinforced to become a strong stimulus to our product development and production," he said, adding that work is being done to find suitable sites.

"Our strategy in China is to keep steady growth in eastern coastal areas, speed up the development in Northeast China and West China, and place focus on South China," Lee said.

The general manager said that part of the 1 billion square meters of labeling and packaging materials that Avery Dennison produces annually in China's coastal cities will be sent there to be processed into labels for local businesses as the centers are set up.

"Annual sales are expected to increase by 40 percent by 2015 to reach about $600 million when these distribution centers are completed," Lee said.

Avery Dennison put into operation a $7 million coating facility in Kunshan, Jiangsu province, on Aug 15 to increase its production capacity in China. The new facility is able to produce about 50 million sq m of labeling and packaging materials annually for the electronics industry.

The Kunshan manufacturing center, in which the company invested $27 million, has a manufacturing capacity of 440 million sq m annually.

To support its market expansion strategy, Avery Dennison is redoubling efforts to develop products at its R&D center in Kunshan, its first corporate research center outside the US, to meet the growing demand of Chinese customers, he said.

"China is a growing and promising labeling market because consumer goods enterprises and pharmaceutical companies are paying more attention to the labeling and packaging of their products," Lee said.

Statistics show that an average consumption of adhesive products amounts to 20 sq m in developed countries, while in China the figure is less than one square meter.

"We have asked our researchers to adjust the research model in order to develop more new products," he said.

chenqide@chinadaily.com.cn