ZKH Launches Taicang Smart Manufacturing Base, Setting New Standard in Industrial Product R&D and Production Integration

Rhea-AI Summary

ZKH Group Limited has unveiled its new 30,000-square-meter smart manufacturing base in Taicang, marking a strategic advancement in integrating R&D and production capabilities. The facility features a CNAS-accredited testing laboratory and focuses on industrial product development. Notable achievements include the company's private label products growing 40% year-over-year, contributing over 8% to total GMV in Q1 2025. The smart manufacturing base optimizes product design, testing, and small-batch production processes, enabling rapid market response. CEO Eric Long Chen emphasized the facility's role in enhancing product development and supply chain management while fostering collaborative innovation with strategic partners to accelerate industrial digital transformation.

Positive

• New 30,000-square-meter smart manufacturing facility enhances R&D and production capabilities
• Private label products showed strong 40% YoY growth, contributing 8% to Q1 2025 GMV
• CNAS-accredited testing laboratory ensures high-quality product standards
• Facility enables faster product development and market response through integrated design, testing, and production

Negative

• None.

Insights

Manufacturing & Supply Chain Strategist

ZKH's new Taicang facility integrates R&D with production, boosting private label growth and enhancing competitive positioning in China's MRO market.

The commissioning of ZKH's 30,000-square-meter smart manufacturing base in Taicang represents a strategic evolution in their business model. This facility creates a closed-loop ecosystem where R&D directly feeds into production capabilities, significantly reducing time-to-market for new products. The CNAS-accredited testing laboratory adds particular value, as it allows ZKH to internally validate product quality rather than relying on third-party testing, creating both cost efficiencies and quality control advantages.

The timing is particularly strategic, considering their private label products grew 40% year-over-year and now contribute over 8% of total GMV. This suggests the company is successfully transitioning from a pure procurement platform toward a hybrid model that captures higher margins through self-developed products. Private label offerings typically deliver 15-30% higher margins than third-party products in the industrial supply space.

This manufacturing base positions ZKH to address a critical market gap in China's industrial ecosystem. While China has abundant manufacturing capacity, facilities that integrate advanced R&D with production flexibility remain relatively scarce in the MRO sector. The ability to conduct small-batch production enables rapid prototyping and iterative development—essential capabilities for responding to the highly specialized needs of industrial customers.

By strengthening their supply chain integration capabilities, ZKH is creating competitive barriers that pure e-commerce players would struggle to replicate. This vertical integration strategy enables them to control more of the value chain while potentially capturing data throughout the product lifecycle, which creates additional competitive advantages in product development and inventory optimization.

SHANGHAI, June 4, 2025 /PRNewswire/ -- ZKH Group Limited ("ZKH" or the "Company") (NYSE: ZKH), a leading maintenance, repair and operations ("MRO") procurement service platform in China, today announced the official commissioning of its state-of-the-art smart manufacturing base in Taicang. This facility marks a significant milestone in the Company's strategic effort to integrate R&D and production for industrial products.

Covering 30,000 square meters, the Taicang manufacturing hub is poised to substantially bolster ZKH's product R&D capabilities through a combination of proprietary and collaborative innovation. The facility will play a crucial role in expanding the Company's intellectual property portfolio, driving the growth of its private label products, which grew approximately 40% year over year and contributed over 8% of total GMV in the first quarter of 2025.

A key feature of the new facility is a CNAS-accredited (China National Accreditation Service for Conformity Assessment) industrial product testing laboratory. The facility ensures rigorous quality assurance and caters to the rising demand for high-quality, reliable industrial supplies. Designed for rapid transition from research to market, the center optimizes product design, testing, and small-batch production, enabling ZKH to respond swiftly to evolving customer needs and technological advancements. Additionally, this development signifies a strategic step forward in strengthening industry ecosystems and supply chain capabilities through collaborative innovation with strategic partners.

Mr. Eric Long Chen, Chairman and Chief Executive Officer of ZKH, stated, "Our new Taicang Smart Manufacturing Base enhances ZKH's capabilities in product development and comprehensive supply chain management. By integrating R&D, testing, and production, we are transforming traditional manufacturing and collaborating closely with our partners to deliver innovative, competitive solutions. These initiatives will accelerate industrial digital transformation and contribute to regional economic vitality."

About ZKH Group Limited

ZKH Group Limited (NYSE: ZKH) is a leading MRO procurement service platform in China, underpinned by robust supply chain capabilities and dedicated to serving customers globally through a product-led, agentic AI-driven approach. Through its primary online platforms, the ZKH platform and the GBB platform, along with innovative technology and extensive industry expertise, the Company provides bespoke MRO procurement solutions to a diverse and loyal customer base. These solutions encompass hyper-personalized product curation from a comprehensive selection of quality products at competitive prices. Additionally, the Company ensures timely and reliable product delivery through professional fulfillment services. By focusing on reducing procurement costs and addressing management efficiency challenges, ZKH is transforming the opaque MRO procurement process and empowering all stakeholders across the value chain.

For more information, please visit: https://ir.zkh.com.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made pursuant to the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "may," "will," "expects," "anticipates," "aim," "estimates," "intends," "plans," "believes," "is/are likely to," "potential," "continue," and similar statements. Among other things, the quotations from management in this press release and ZKH's strategic and operational plans contain forward-looking statements. ZKH may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission (the "SEC"), in its annual report to shareholders, in press release and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about ZKH's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: ZKH's mission, goals and strategies; ZKH's future business development, financial condition and results of operations; the expected changes in its revenues, expenses or expenditures; the expected growth of the MRO procurement service industry in China and globally; changes in customer or product mix; ZKH's expectations regarding the prospects of its business model and the demand for and market acceptance of its products and services; ZKH's expectations regarding its relationships with customers, suppliers, and service providers on its platform; competition in the Company's industry; government policies and regulations relating to ZKH's industry; general economic and business conditions in China and globally; the outcome of any current and future legal or administrative proceedings; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in ZKH's filings with the SEC. All information provided herein is as of the date of this announcement, and ZKH undertakes no obligation to update any forward-looking statement, except as required under applicable law.

For investor and media inquiries, please contact:

In China:

ZKH Group Limited
IR Department
E-mail: IR@zkh.com

Piacente Financial Communications
Hui Fan
Tel: +86-10-6508-0677
E-mail: zkh@thepiacentegroup.com

In the United States:

Piacente Financial Communications
Brandi Piacente
Tel: +1-212-481-2050
E-mail: zkh@thepiacentegroup.com

 

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SOURCE ZKH Group Limited

FAQ

What is the size and location of ZKH's new smart manufacturing base?

ZKH's new smart manufacturing base is located in Taicang and covers 30,000 square meters.

How much did ZKH's private label products grow in Q1 2025?

ZKH's private label products grew approximately 40% year over year and contributed over 8% of total GMV in Q1 2025.

What certifications does ZKH's new testing laboratory have?

The facility includes a CNAS-accredited (China National Accreditation Service for Conformity Assessment) industrial product testing laboratory.

What are the main features of ZKH's new Taicang manufacturing facility?

The facility integrates R&D, testing, and production capabilities, includes a CNAS-accredited testing laboratory, and enables rapid transition from research to market through optimized product design and small-batch production.

Who is the CEO of ZKH and what did they say about the new facility?

Eric Long Chen, Chairman and CEO, stated the facility enhances product development and supply chain management capabilities while enabling collaboration with partners to deliver innovative solutions.