Entrepreneur escapes pickle to make pretty penny

How did a 38-year-old technician in China manage to strike gold in just five years? By surfing the wave of a sport's soaring popularity in the United States, that's how.

Gong Minchong, from Qingyuan, Guangdong province, is the founder of Niupipo, a manufacturer of carbon fiber products. And a trendy, fast-growing sport — pickleball — has helped the entrepreneur achieve stunning commercial success in just half a decade.

Pickleball originated in the United States in the late 1960s. It combines elements of table tennis, badminton and tennis, and is typically played on outdoor courts.

Using a ball similar in size to a tennis ball and a net set at a height lower than a tennis net, the game is usually played in doubles format (with teams of two players). The rules of pickleball are relatively simple, where players use paddles to hit the ball over the net, aiming their shots to prevent opponents from returning the favor.

By riding the tide of the sport's soaring popularity in the US, it took the once little-known brand from Dongguan, Guangdong province, five years to become one of the top pickleball paddle brands on the Amazon platform, with frequent appearances on the bestseller list.

Most recently, it surpassed many established sports giants, such as Fila, as well as US pickleball paddle brands like Franklin Sports, in terms of sales volume on Amazon.

Last year, despite COVID-19 challenges, Niupipo reported revenue of 120 million yuan ($17.4 million), of which 80 percent came from selling pickleball paddles to overseas retailers. Gong said the company now targets 180 million yuan in revenue this year with around a 20 to 30 percent profit margin.

"Niupipo's success in overseas markets completely surpassed my expectation. I was aware of the market potential after conducting research on the pickleball craze in the US, but I didn't expect to see the outcome to be this quick and big," Gong said.

With more businesses from Malaysia and India contacting him for cooperation this year, Gong said: "There is a huge need for cost-effective and high-quality Chinese products, and the domestic demand for pickleball paddles will also get bigger since the country optimized its COVID-19 measures."

In recent years, pickleball has experienced rapid growth worldwide, attracting players of all ages and fitness levels thanks to its easy-to-learn nature. The value of the global pickleball equipment market was estimated at $65.64 billion last year and will grow at a compound annual growth rate of 9 percent to reach $155.4 billion by 2033, according to market research provider Fact. MR.

"Easy to learn, quick to grasp and good for socializing, pickleball is increasingly enjoyed by a wide range of people. There are also a growing number of tournaments that entice players to continue to practice and win, and more players are demanding higher requirements for good-quality paddles and accessories," Gong said.

The sport has been introduced to China through various channels, including international competitions, exhibitions and grassroots efforts by enthusiasts. In recent years, it has gained attention and interest from individuals, sports clubs and organizations in China who deem it an enjoyable way to stay active and socialize.

Prior to entering the pickleball market, Niupipo's main business was the production of carbon fiber components. Gong set up a factory in 2016 after resigning from his job as a technician. By then, he had only one assembly line machine.

"At that time, the carbon fiber components production industry had intense competition, and our factory faced pressure of lower prices from competitors. A friend then requested us to produce pickleball paddles, which are also made of carbon fibers. After conducting research, I found there was a huge untapped market with big business growth opportunities, so I made the decision to change the main business to producing carbon fiber paddles," Gong said.

The next question was whether to sell them as outsourced products for an established player or to make them under a new self-owned brand.

"We worked as an OEM (original equipment manufacturer) for about a year, selling white-label paddles and semifinished products for other companies. As pickleball gained popularity, the demand for related sports apparel and equipment continued to surge. Our clients made a lot more than us by tapping the growing market. I decided to build my own brand for more profit," Gong said.

He decided to use "Niupipo" as the name of the brand, because he thought it sounds like the word "super cool" in Chinese. He chose Amazon for its global sales platform, but was soon confronted with a major challenge that almost broke his business out of the gate.

In 2018, Gong's online store was halted by Amazon for about three months due to business disputes with an overseas peer, which led to a lawsuit.

"All of our earnings were frozen in the Amazon account. Our products were also kept in an overseas Amazon warehouse, and we had no way to transport the goods back to China to sell to others. My business completely stopped," Gong said.

"Apart from the support from my family and friends, I poured all my savings and loans from the bank into the business which totaled 5 million yuan. Because I knew if I shut the Amazon store I'd lose everything, I persisted with the overseas lawsuit despite great difficulties and big spendings it involved. Besides, I was confident that I could win the lawsuit," Gong said.

Then, the happy story went on as Gong ended up winning the lawsuit and reopened the store on Amazon. In 2018 — the first year Gong started the business — he earned over 10 million yuan despite the three-month halt of business, with a profit margin of around 15 percent.

That gave him even more confidence to step up investment in the business with a focus on launching cost-effective and innovative products.

"Our business strategy focuses on targeting the mass market, providing professional products at relatively low prices. In contrast to domestic manufacturers that compete solely on price, we put more effort into ensuring product quality, and guaranteeing that our products have higher performance at similar prices. Compared with established brands, we offer products with similar performance but much lower prices," Gong said.

"Our team also spends a lot of time doing online marketing. This strategy has helped our products stand out from the pack among similar sellers on Amazon."

As the popularity of pickleball continues to grow, the domestic market in China has also started to gain momentum. Gong said that in the past two years, many associations and clubs reached out to him for cooperation.

"The sport is gradually gaining popularity among Chinese consumers. Many domestic sports organizations are starting to recognize pickleball as a recreational and professional game, and include it in some tournaments, programs and events. In addition, pickleball equipment, such as paddles and balls, are becoming more widely available in China through online and offline retail channels," said An Fuxiu, founder of Sportbank, a Beijing-based sports industry think tank.

The sport's growing popularity can be seen by heated discussions on social media platforms. As of early April, there were over 2,000 posts relevant to pickleball on lifestyle sharing platform Xiaohongshu. On short-video platform Douyin, videos hashtagged "pickleball" had over 6.4 million appearances.

An said that in recent years, the government has also launched multiple documents to promote the development of outdoor sports, which helps create a good business environment and provides relevant companies with good opportunities to generate new growth points.

"The domestic market is growing and now contributes around 20 percent of Niupipo's total revenue. We are eyeing a revenue of 180 million yuan this year combining markets from home and abroad," Gong said.

Looking ahead, Gong's focus of work for the next three to five years will be on breakthroughs in product technology to cater to different demographics and scenarios.

He also plans to expand his business into pickleball accessory products like apparel.