How can Chinese manufacturing companies successfully transform from OEM to global brands?
What are the core challenges and solutions after the transformation?
This foundry, which has been in arrears, has taken the initiative through mergers and acquisitions — by formulating brand strategies, achieving differentiated positioning and building an ecosystem, thereby building a competitive global brand, and reaching 70 million US dollars in sales!

At the beginning of 2021, while most people were still anxious about the uncertainty of the pandemic, a Chinese entrepreneur saw an opportunity. In Jiaozuo, Henan, Zhongzhou Machinery, a state-owned arsenal with a history of more than 60 years, is on the verge of bankruptcy. This factory, which was founded in 1959, was once an important military enterprise in China, but after China implemented strict gun control laws in 1996, its domestic market was almost completely cut off.

He himself has many years of experience in the field of camouflage clothing and camouflage products, and has always paid attention to gun peripheral products. This acquisition may seem like an adventure, but it actually has deep meaning.

At this point, an interesting phenomenon appeared in the US market: water gun toys suddenly became popular. During the pandemic, people stuck at home are in desperate need of an outlet to vent their emotions. A toy that can launch hydrogel projectiles, looks like a real gun but is safe and harmless, and quickly became popular on social media platforms such as YouTube.

In 2020, an American startup team launched a water gun product through crowdfunding, causing a stir in the US. After being officially launched at the end of 2021, the Gel Blaster brand achieved sales of 5 million US dollars in the first year, and reached 50 million US dollars in 2022.

Unfortunately, the good times didn't last long. As a foundry for Gel Blaster, Mr. Lin discovered last year that the brand that placed the order for him was suddenly unable to pay for the goods, which made him very anxious and worried. “Gel Blaster is a very good brand, but the founders didn't stabilize after initial success, which eventually led to a breakdown in the funding chain. We couldn't bear to see this valuable brand disappear, so we finally decided to buy this brand. Abbottt, Premiere Creative’s creative director.

After difficult negotiations with “Party A's Dad,” Mr. Lin finally successfully acquired the former customer brand Gel Blaster in 2024. This strategic acquisition made the water gun brand, which has excellent genes and excellent historical performance, 100% owned by a Chinese company, while the original founder continued to hold the position of CEO and maintained the continuity of the brand's operations.

After successive acquisitions of factories and brands, Mr. Lin did not simply continue the OEM business. In order to create a more competitive brand matrix, he formulated a “dual brand strategy”:

● On the one hand, he founded his own brand CosmoXToys to highlight the unique advantages of product shooting performance
● On the other hand, the acquired American brand Gel Blaster carried out a strategic transformation of game track positioning

The two water gun brands are not simply repetitive, but are carefully designed to complement each other: “Gel Blaster is more game-oriented, emphasizing a sense of technology and sci-fi. The target users are teenagers, focusing on interactive experience and sense of game; while CosmoXToys is more focused on the shooting experience, which emphasizes speed and accuracy. The target users are adults, focusing on realistic shooting experience and excitement. Abbottt, Premiere Creative’s creative director.

To ensure the differentiation of the two brands, the team took a series of steps:

● Each brand uses different teams to work independently to avoid design similarities and marketing convergence
● Strict differentiation is made in product color, appearance and function to ensure that brands maintain significant differentiation and uniqueness

In order to ensure that the global teams after the acquisition can carry out their duties and develop their strengths, the division of labor between the Chinese and US teams was also divided according to their respective advantages:

● The US team is responsible for design and function development
● The Chinese team focused on internal structure and technology optimization

The clear dual brand positioning brought significant sales growth and profit to the company, turning losses into profits. In 2024, Lin's enterprise reached 70 million US dollars in sales, about 490 million yuan.

Unlike traditional toy manufacturing brands, Mr. Lin's vision is far more than selling more products or starting a toy brand; he is building a complete ecosystem.

Mr. Lin, Chairman of Gel Blaster and founder of CosmoXToys
“We not only sell water gun products, but have also set up an offline experience center. As of July 2025, we have opened 54 offline experience stores in the US, and accumulated 500,000 users in 6 months. In addition, we have created an online app and community where you can earn points and socialize. Abbottt, Premiere Creative’s creative director.

These experience centers are not only points of sale, but also social centers. Here, users can participate in shooting contests and various activities and experience the fun of “realistic games.” At the same time, the company has also developed a supporting app, which has attracted 500,000 registered users and enhanced user stickiness through a points system and social functions.

This ecosystem mindset has paid off significantly. As of 2024, Gel Blaster has sold a total of 10 million products and has 3 million followers on YouTube and Facebook.

From doing OEM products to building a global brand, this path is not an easy one. The team faced multiple challenges and ongoing transformation:

1. Pricing chaos and channel conflict

At the beginning of the brand's founding, there was no clear pricing policy distinction. Salesmen would actively lower prices in order to obtain orders, or even approach the factory price, causing chaos in the agency price system. The solution is to completely separate factories and sales, establish two separate companies, avoid the intersection of sales networks and hierarchies, and establish a clear pricing system.

When building a factory, you mainly need to think about how to make good products, ensure quality, and relatively determine revenue and profit; while building a brand, you need to think in a comprehensive manner, put in more physical strength, mental strength, and mental strength, take greater risks, and live more stressful. But at the same time, the gains, insights, and patterns brought about by brand operations are also completely different, requiring a fundamental shift in the way the team thinks.

“The US team is expensive and likes big investment and output; the Chinese team is more stable and stable. ” Faced with this cultural difference, the new company achieved a collaborative effect of 1+1>2 through a clear division of labor, giving full play to their respective advantages. The US team is responsible for marketing and design design, and the Chinese team is responsible for technical optimization and production follow-up.

“Guns are a sensitive topic in any country. We must ensure that the product is not misunderstood as a real gun, and at the same time allows users to find the thrill of shooting. ” Through careful design, the team made extensive adjustments in appearance, color, and function to ensure that the product was both fun and safe, and complies with national regulations.

In terms of product development, Mr. Lin's team abandoned the “empirical” approach of traditional factories and instead adopted a data-driven innovation model:

By analyzing Amazon's return reasons, we discovered many improvements. For example, some users reported that the product was unsuitable for left-handed users, and we immediately made design adjustments.

They also pay close attention to users' teardown videos on YouTube to get inspiration for improvements. “At one point, we discovered that foreign users increased their shooting speed through modifications. Originally, we adjusted the speed by adding more resistors, but this would increase the cost. Inspired by users, we innovatively used an 'air leakage' method to adjust air pressure, which not only optimizes functionality but also reduces costs. Abbottt, Premiere Creative’s creative director.

Now, Mr. Lin's team launches 3-4 new products every year, and software and hardware are upgraded simultaneously, which has become the company's normal. Through real data from all channels, including real user feedback and search preferences such as Amazon Brand Analysis (ABA), real user reviews, Vine plans, etc., we analyze consumer preferences and guide the direction of product improvement, including the launch speed, service life, and design of water guns.

“Since I have just acquired the old brand Gel Blaster and launched the new brand CosmoXToys on Amazon, I have recently attended many Amazon summits, forums, and salons, and learned very practical methodologies and specific practices, such as Amazon's full-link brand building plan, to help us sort out the solutions for the core goals of building a brand at every stage. I discovered that we are still elementary school students, and we still have a long way to go when it comes to building a brand and running fine operations. Mr. Lin humbly said, “From OEM to becoming a brand owner, we need to continue to actively learn from experts, peers, users, and the market, so that we can keep pace with the times, make truly popular products, and build a truly influential brand. Abbottt, Premiere Creative’s creative director.

From a foundry that has been in arrears to a global enterprise with dual brands, 54 experience stores, and 3 million fans, Mr. Lin's entrepreneurial story is not only an example of business transformation, but also an inspirational legend about seizing opportunities and continuing to innovate in the midst of a crisis.

Through precise brand positioning, ecosystem building, cross-cultural team management, and data-driven innovation, this Chinese entrepreneur has successfully achieved a gorgeous transformation from OEM to brand, providing valuable experience and inspiration for more Chinese manufacturing companies to become global brands