Guo Erniu watches before his Monkey King product gets loaded on truck.

At first, he used corn stalks for the inner structure, and covered them with paper. Continual improvements followed. For all of his animal-shaped products, he concentrated on the details to make them look real, and they always sold faster than his competitors. He earned enough to open a studio one year later.

Lanterns made of corn stalks and paper only survive one festival, however, and are not suitable for long-distance transportation.

As his business grew and orders came from other cities, Guo turned to more resilient iron wire. He also started using silk instead of paper for the covers.

At the peak of his business in 2008 and 2009, he hired 30 welders and another 30 laborers. His products were sold nationwide, and were also exported to Malaysia.

The lantern-making industry flourished in his village.

"As many as 110 out of the total 320 families here adopted the business in 2012, having made 18,000 lanterns with a revenue of 30 million yuan," Guo said. "Unlike others, our villagers seldom work outside."

With the economic slowdown, orders fell by 20 percent this year. But Guo is confident of continued success, because smaller models account for a growing percentage of his orders.