Smart Light Systems, the marketing arm of Mosta-based LED manufacturer Sicons Opto Products, is planning to tap the domestic market after making its first foray in the local commercial sector, managing director Jonathan Borg told The Sunday Times.
Established in 1999, Sicons Opto Products, a joint venture with Signal Construct of Stuttgart, is the only Maltese manufacturer of LED systems. Run by father and son Henry and Jonathan Borg, the company's calling card is a portfolio of EU-made, flexible products with guaranteed 20,000-hour lifetimes as a minimum. Other products boast lifetimes of up to 50,000 hours.
The Smart Light range offers cold lighting with 99 per cent consumption saving, translating into a refund of outlay within just seven months. Smart Light is able to design systems producing light in various colours with exceptionally reduced wattage (1,000W can be cut to just 20W) and slashed carbon emissions. Significantly, Smart Light is able to fit its products on previously installed electrical systems under its 'off and replace' philosophy, resulting in considerable savings from the project's outset.
Sicons Opto Products' relatively small operation at its Mosta Technopark base, where it employs 20, belies the remarkable reach of its production line. For years it has been manufacturing components for Siemens and Nokia mobile phones and Mini Cooper cars. Its considerable exports to Germany are also destined for clients like Airbus, the military aircraft industry, nuclear power stations, car and heavy vehicle manufacturers, tram and train companies, and parking houses.
The mother company was set up in 1973 by engineer Herbert Hofsaess who originally worked for the LED division of a world-renowned electronic company. The LED concept was still in its infancy but he helped develop the company's portfolio with what became market leading products, and Henry Borg recalled, the company made considerable leaps thanks to Mr Hofsaess' work.
Mr Borg met him in the late 1990s, several months after he was encouraged to invest in Malta. A former director of the Malta Development Corporation and Valletta Investment Bank, Mr Borg was deemed to have the experience to convince him to make the step.
Mr Borg was also fresh from his 10-year experience with component manufacturer WET, which between 1986 and 1998 expanded its Malta plant from a headcount of just eight to over 300.
A business plan was formulated for the new venture and Sicons Opto Products was inaugurated in July 1999. In over 10 years, the local operation has contributed heavily to the German company's product portfolio.
"Back then, it was decided that it was more cost-effective for production that involved electronic machinery to be based in Germany. Labour-intensive production was earmarked for Malta," Mr Borg explained. "But times are changing and every aspect of production is beginning to involve technology. The systems we have always had in place that ensured quality standards and flexibility have helped us to grow year on year - except for 2009, unfortunately, because of the recession."
The recession, however, fuelled the advancement of a new business opportunity for LED lighting on the islands. In a bid to diversify and consolidate the Maltese operation, the family had already commissioned the development and design of LED lighting which coincided "quite nicely with the recession".
A range of products and systems have been installed at several restaurants, luxury hotels and retail outlets under Smart Light's original business-to-business marketing plan, but now, Jonathan Borg added, the focus will increasingly turn to the products' potential for domestic application.
"For many years the Maltese have installed the normal incandescent light," Mr Borg explained. "We feel that with the increasing utility rates, people are increasingly realising they do not need as much light and are considering a different quality of light to save on bills. Rather than complaining about the bills, they can do something about them."
Mr Borg added that as the products are researched and developed in Germany, they are EU-approved. Smart Light is now working to obtain the eco label over the next few months. Eco labelling on LEDs is still in the process of being formulated at EU level and Smart Light hopes to be among the first organisations to achieve it.
With a view to widen its product range, Smart Light has outsourced its research and development to a local team of engineers. Their brief is to examine how regular lighting is used in a variety of properties and locations and to devise ways to retro-fit Smart Light products by creating systems at the least possible cost to the client. So far, Mr Borg emphasised, Smart Light has been successful in formulating systems that do not require clients to strip their venues of previous lighting frameworks.
Smart Light is also testing its lighting solutions in a comparison exercise involving a range of products already on the market. The company intends to exploit the results in subsequent marketing campaigns.
"Head office is geared for the industrial market, not for the consumer sector," Henry Borg pointed out. "We would like to exploit that potential locally and we are ready to invest in a fully fledged research unit. We are working on a business plan and discussing our entitlement to EU funds with Malta Enterprise. Without help from Malta Enterprise and its expertise, we would not be in a position to pursue our plans in this direction."
The research and development function also falls within a wider strategy under which Smart Light seeks to export to markets like Italy, the UK and France. Research into Smart Light's market potential within these countries was initiated recently and target regions have been identified.
The Borg family is confident Smart Light can compete with existing suppliers in these markets on price and quality, but most notably, with an EU product made in Malta.