A Chinese proverb says, ‘Wealth doesn’t pass three generations’, but family business Bee Cheng Hiang has flourished with each transition. The programme Money Mind finds out why.
SINGAPORE: It began as a one-man show, street hawker Teo Swee Ee peddling his barbecued pork slices in Chinatown in 1933. He carried only a bamboo stick with a basket at each end – one containing his product, the other a charcoal grill with which to freshly grill the meat.
Eighty-five years later, appetite for bak kwa has grown and with it, that humble operation. Today, thriving family business Bee Cheng Hiang has more than 370 outlets in 13 territories.
Just as demand these days shoots up at Chinese New Year, group general manager Daniel Wong said that in those early years too, business was brisk for his great-uncle during festive seasons.
“When there were festivals, there’d be a gathering of hawkers. And he’d join (them) and barbecue on the spot for customers. That’s how we started,” he said in an interview with the programme Money Mind, for an episode on family businesses (it airs Feb 17, 10.30pm).
Twelve years went by, and Bee Cheng Hiang’s first shop opened in 1945 in Rochor Road. The rest is history.
How did this family businesses survive and go from strength to strength over three generations and an 85-year history? Here are six pointers.
1. LOOK FOR OPPORTUNITY IN PROBLEMS
When the company had a shop in Victoria Street in the early decades, one of its neighbours was a logistics firm whose lorries parked along the road, blocking the shopfront and the Bee Cheng Hiang (or Bee Chun Heng, as it was then known) sign.
“What my great-uncle did was he talked to the owners, saying: ‘How about … I pay you some money to paint your trucks? I’ll beautify your trucks’,” said Mr Wong.
And that was how Bee Cheng Hiang put out its brand name around Singapore – on lorries doing delivery services. “That was probably the advent of advertisement on trucks,” mused Mr Wong.
2. THE YOUNG COUNT, EVEN IF THEY AREN’T TODAY’S DECISION-MAKERS
The company had a bigger problem in 1997-98: The double whammy of the Asian financial crisis and the Nipah virus outbreak.
“First, the economy was bad … Then, people were just afraid to eat pork,” recalled Mr Wong. “That set us thinking, did we want to continue operating in the same mode as before – or did we want to think out of the box?
“And so we started to build up our pool of customers more aggressively.”
In short, Bee Cheng Hiang found that its customer base was getting older, and that it needed to reach out to the young. And so it did.
“For every kid that came into the shop, we made it a point to give (him or her) a sample,” Mr Wong said. “Kids aren’t the decision-makers in purchasing, we know that. But we wanted them to enjoy the taste, .”
The company also gave out free stickers, expecting the children to paste these on their bags, pencil cases and “all over the place”.
The campaign was a success, according to Mr Wong, because of what Bee Cheng Hiang’s straw polls showed years later: Children entering their late teens “all knew the brand”.
3. STAY RELEVANT, FIND NEW MARKET SEGMENTS
The company found other ways to make itself relevant to consumers. In the early 2000s, realising that the pace of life was getting faster, it came up with small, vacuum-packed bak kwa for working adults.
“That suited their lifestyle. They could open it up and eat it without the hassle of having to deal with oil,” said Mr Wong. “They could bring it to the office and … not have any pest problem.”
Because it was such a departure, “when we first started to sell this, our regular customers wouldn’t even look at it, because they were so used to freshly barbecued bak kwa”, said Mr Wong.
Young parents, however, started buying the Mini EZ bak kwa because it was easy to give to their children.
Another group of consumers Bee Cheng Hiang reached out to were those who were health-conscious – by developing the Chiziban, a crispy version of bak kwa that the company’s nutritional tests found to be “high in protein and low in calories”.
The product is made from pork loin, which has a lower calorie count than chicken breast, noted Mr Wong, who added: “This is how we capture different market segments.”
The company is also embracing new payment technology. “Ten years ago, we were talking about the EZ-link card … Today, we’re talking about Alipay, WeChat Pay,” he said. “We have to go with the needs of customers.”
4. GET INTERNAL FEEDBACK, PUSH OUT ONLY THE GOOD STUFF
Although Bee Cheng Hiang’s research and development team creates new products every year, at most only one in five products makes it to the shelves.
New flavours and variants are sometimes rejected because “the market may not be ready”. There would also be consequences if customers get “tired of bad new products”.
“We’d have this bad after-effect where people say, ‘For every new product you launch, I’m not going to try because it’s not going to make it,’” said Mr Wong. “So we only present the best to customers. In this way, (they) would keep coming back.”
While customers are not directly involved in the product development process, the company has a “big selection of colleagues” to tap. “For every product … (we) get internal feedback first,” shared Mr Wong.
We always want honest feedback. We want to hear the bad news if there is any. We want people to be critical because that’s part of the learning process.
5. VALUE NON-FAMILY EMPLOYEES
It may be a family business, but when it comes to finding people to groom in the company, honesty and hard work are the two criteria Mr Wong lists – not blood. It does not matter if the person isn’t a family member, he stressed.
There are now fewer than 10 family members in the company, in senior as well as junior positions. And the general manager of the barbecued pork chain is a non-family employee.
Mr Wong, who joined the company in 1993, said: “From day one, we realised that there are just not enough family members to do everything.”
One reason non-family employees are an important asset is that they bring a diversity of views and experiences. And their trust must be earned.
Mr Ng Siew Quan, PwC Singapore’s Asia-Pacific Entrepreneurial and Private Clients Leader, said: “Managing this group of people will be crucial (so that) they feel that they’re part of the family business … (and) are in the same direction pursuing the vision of the family business.”
Many family businesses in Singapore and Asia are still young, he added, and have not picked up enough lessons to get such business transitions right.
Bee Cheng Hiang, however, has gone from strength to strength because it welcomes and trains all talent, highlighted Mr Wong. “It’s hard to find a suitable person to go into a new market and grow that market, so grooming people is always at the top of our minds.”
6. WIDEN YOUR HORIZONS
When Mr Wong joined the company, it had about 12 to 15 shops in three territories: Singapore, Malaysia and Hong Kong.
Expansion picked up only from the mid-90s, when Bee Cheng Hiang started working with business consultants on a franchising programme. “At that time, franchising was the ‘in’ thing. Everybody was talking about the McDonald’s franchise model,” he said. “It was a great way to expand.”
The company relies on a two-pronged approach: It can use the franchise model as long as the territory is suitable; or it can enter the market directly. Having a franchise partner with good local knowledge about a market can lead to faster expansion.
“We’ve been very successful with the Asian market, and we’re always keeping an eye on the European and American market,” he said.
About 20 years ago, the company used to get only a handful of enquiries from Europe and the United States. It now gets “hundreds” of enquiries but has “yet to find a suitable partner”.
Still, Mr Wong remains hopeful that he can “bring the Singapore taste to a new territory, to a new culture”, as venturing overseas has “definitely” been a key part of Bee Cheng Hiang’s success.