3G Technologies strives to improve everyone's housing and living experience with premium quality hardware for windows and doors. The company specializes in Lift & Slide hardware and offers a wide range of roller and hinge products. 3G has made ceaseless efforts in product innovation and technological R&D, with a smart factory transition planned by 2021.
Persistent Pursuit of Mechanical Excellence
40 Years of Making Hardware for Windows and Doors
When we think of what makes up a window, the glass and the window frame are the first two things that come to mind. Indeed, these are the two most critical components. But we often neglect a third key factor in terms of window quality – the window hardware. They are the familiar parts that we use every day to help us open and close windows, such as hinges, rollers and locking devices.
Window experts stress that the function and durability of any window are largely proportional to the hardware quality, which is dependent on the manufacturer’s level of technical expertise. This is how a select few German and Italian companies have long dominated the global market, with expertise and reputation built over the past 100 years.
Meanwhile, on the opposite side of the globe in Korea, a hidden champion named 3G Technologies is challenging the European clique of hardware manufacturers. Located in Eumseong County, Chungbuk Province, about 100 km southeast of Seoul, 3G has 40 years’ experience in making hardware for windows and doors and boasts its own manufacturing technology.
Among the numerous window hardware manufacturers in Korea, 3G stands out for its continued focus on the international market. Unlike the other manufacturers in Korea, 45% of 3G’s annual revenue is generated from overseas markets, including China, Europe and the US.
3G Technologies has also built a competitive edge with its ceaseless R&D efforts and ability to quickly adapt to any market change. These unique strengths are why we are highlighting the company as a “hidden champion.”
[Products & Value Proposition] Focus on Sliding Hardware Not Made by European Peers3G Technologies was founded in 1981 in Korea’s Gyeonggi Province, the area surrounding the capital city of Seoul. The company originally operated under the name of Hyangsang Industries and first grabbed the attention of the market in the 1980s by showcasing the world’s first stainless steel-based window hardware with superior durability. After gaining popularity in the domestic market, the company changed its name to 3G Technologies in 2000 and set sail for global expansion.
The best-selling products manufactured by 3G Technologies are part of their flagship Lift & Slide (LS) system hardware. After realizing that the leading companies in Europe mainly produced hinged-window hardware, 3G Technologies CEO Lee Sang-do decided to concentrate on sliding hardware: “The vast majority of European houses have hinged-type windows. On the other hand, Asian countries have a long history of using sliding windows. I concluded that we would have an advantage against European makers if we focused on producing the sliding-window hardware that they didn’t make.”
Lee’s decision proved to be a good one. 3G’s flagship stainless steel hardware product, LS, has become extremely popular in the global market for its durability. The company claims that its LS products can be used anywhere in the world and in any environment, including tropical and coastal areas, as they work well in even the most extreme temperatures and humidity.
The LS system also uses proprietary shielding mechanics for enhanced airtightness, resulting in better protection against outside wind and noise. Energy efficiency can also be maximized using LS, as its improved sealing enhances heat conservation.
The LS system was designed to withstand heavy weight, with a maximum load capacity of 500 kg. This heavy-duty hardware was designed with 3G’s global ambitions in mind: in Asia, apartments are the standard; but in Europe and the US, there is a greater percentage of houses, which require a higher weight capacity. The weight-resistant design is also in line with the recent trend of large, luxury houses in Europe and the US increasingly requiring heavier, larger windows.
In addition, 3G has been accredited by the relevant international authorities for its superior mechanics and manufacturing technology. It received the ISO Certification for Quality Management System (QMS) and its LS was certified by a relevant accreditation body in Europe for ‘100,000 times of run test and 1,000 hours of corrosion test’.
Moreover, 3G has set up its own quality assurance system to ensure constant improvement of product quality. Lee commented, “we make sure that the quality assurance tests that we conduct with our inspection facilities are twice as challenging as those performed by the European authorities.”
[Market Proposition] Next Goal: Annual Export of $10M3G Technologies is also excelling in the US market where consumers have high hardware quality standards but also expect the best value for money. Lee commented, “US consumers are practical and stress both quality and price, whereas European consumers prefer established brands.”
On his company’s stellar performance in the US, Lee added that, “our products have been widely acclaimed for both product quality and service. We have put extra effort in quality assurance and we offer up to a 10-year warranty for B2B sales.” As a result, 3G Technologies hardware accounts for 80% of the volume supplied to the top 20 US hardware distribution companies trading the LS type.
On top of its sustained success in North America, 3G is also expanding fast in Europe. Its total annual exports reached $3 million in 2013 thanks to a new volume of sales to a major window manufacturer in Germany that sells around 1 trillion won worth of windows every year. The export figure rose rapidly to $5 million in 2018, and the company now targets annual exports of $10 million.
[Competitive Advantage] Smart Factory System Set for 20213G Technologies showed its commitment to further improving hardware quality and cost competitiveness by initiating an ambitious project in 2014 to automate the manufacturing process. This project marked the first-ever case of automation among window hardware makers in Korea. As there was no precedent within the industry, 3G Technologies carefully selected a team of six experts in the field of electricity and electronics to lead the automation.
The team planned and implemented the project independently and achieved some key successes in the years following. One of the key milestones was the adoption of a Manufacturing Execution System (MES) in 2018, which brought about a significant drop in the percentage of defective products as well as a spike in productivity. In pace with fast-changing industry demands, 3G Technologies is undergoing a transformation to establish a Smart factory system with an aim to adopt Internet of Things (IoT) technology by 2021.
[Growth Potential] Rapidly Expanding Foothold in Global High-End Luxury Window MarketThe size of the window hardware market in Korea is estimated at around 100 billion to 200 billion won. The players include three relatively large companies; each with annual revenues at around 20 billion won as well as a few dozen smaller manufacturers.
The value chain is largely dominated by big-name construction material companies such as LG Hausys and KCC, companies with enough brand power to influence how the manufactured products are distributed to the consumers. Hardware manufacturers such as 3G supply their products to these construction material companies, which also order from glass companies and window frame manufacturers. The construction material companies then place purchase orders with assembly companies to put the different parts of the window together. When the parts are fully assembled, the construction companies finally sell them to consumers.
Considering that these large construction material companies sell the finished window including the hardware parts, under their own brand names, 3G Technologies decided early to focus on the overseas market. 3G believed that their brand power and product quality would be more properly valued in the international arena. Indeed, said Lee “the window hardware products that we currently supply in the US are sold under the 3G Technologies name, with our own brand identity.”
Another push factor that drove 3G overseas was that Korean consumers do not particularly value window parts, with apartments being more prevalent than houses and renting more typical than owning.
With its first exports to nearby China in 2003, the company now sells its hardware to more than 30 countries and has been continually increasing its global market share, lately strengthening its presence in the high-end, luxury window market worldwide.
3G Technologies highlighted that the size of the window hardware industry is expanding with the rise in demand for windows in large houses and commercial buildings in Europe and the US. With more houses and luxury buildings looking for hardware with superior durability, 3G says its LS products are the natural choice for overseas customers.
[Corporate Culture] Eliminating Top-down Culture with Horizontal Organization Structure3G Technologies is striving for excellence within the organization as well. Its organizational structure is atypical, as it does not have a factory manager that oversees and is responsible for the operation of the whole factory. Instead, the factory is run by a group of team managers who are each responsible for his or her team.
The deliberate absence of the factory’s top position is based on Lee’s judgment that a vertical organizational structure headed by a single factory manager prevents free and open sharing of ideas that can enhance productivity. “It used to be rare for any problem to surface due to the vertical, inflexible structure of our organization,” Lee said, adding “a new culture of proactive problem-solving developed when a more equal, horizontal structure was put into place after removing the factory manager position.”
Outside the company, 3G has recently made an effort to cultivate a more diverse housing culture in Korea. To this end, it built the “Window Museum & Education Center” near its headquarters in Eumseong County. Designed for the general public, the museum showcases 16 types of windows and shading systems of various sizes used in different parts of the world.
In opening the museum, Lee said that he wanted to “demonstrate the diversity of windows, showing different levels of quality and function to Korean consumers who typically live in apartments.” He said that another reason for building the museum was to “provide in-depth information to consumers and offer wider choices for window purchases.”
3G Technologies was founded by entrepreneur Lee Jang-woo, who still holds a 30% stake of the company. 3G is now led by his son Lee Sang-do, the current CEO and the largest shareholder with a 44.7% share.
By Kyung-Jin Min (firstname.lastname@example.org)