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1. What is the nature of your business?
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We are mainly in a distribution of commercial kitchen and service equipment industry for hotels, fast foods, restaurants and institutions.
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2. What made you embark on this venture choice?
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In the 60's, I was employed by European company that specialized in this line and when I more or less advanced my career into being manager of a division at a very young age, I found that the room for further advancement would be slow, so I decided to branch out myself. Part of the reason was also because that company was a target of a takeover. The opportunity was ripe for me to break out on my own with 2 of my good colleagues.
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3. How does your business work?
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Simplex not only distributes commercial Food Service Equipment to the hotels, restaurants and fast foods, but also provides after sales service and consultancy work. We are a system integrator as well. Especially the hotels and fast foods operators require sophisticated equipment, so we have to scour the United States and Europe to source the appropriate equipment and then negotiate a distribution agreement with the manufacturers.
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4. Did you have the capital to start the business or did you have to borrow from someone to get started?
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Initially it was difficult in the sense the bank would not give us any loan, because at that time we were not that structured. It was quite ad-hoc, in a sense that we used our own money and relied on friends who are the suppliers in this industry. Whatever profit we had was ploughed back into the business.
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5. Do your parents have their own businesses too? Have they inspired you in one way or another?
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At that time my father was also having business on his own, but I did not rely on him. He was a role model for me though.
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6. What was your childhood dream? When did you decide that you would strike out on your own instead of working for someone else?
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I would say my dream at that time was to going into the corporate world, but circumstances turned out that I found that I need to break out and do my own. The opportunity was present to me at that right time and right place.
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7. Why does someone decide to be on their own rather than join an existing company?
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You must have that kind of passion to believe in your dreams that you want to make more than you can achieve in an employment. Come with it, despite of any ensuing difficulties, it is the satisfaction derived in overcoming them and it does make you're a better and worthy man in society.
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8. Are there at any point in your life that you experienced a significant event (WW2, racial riots of the 1960s, the Economic Crisis of the 80s or 90s, SARS, new competition or shifts in market behavior and trends) which affected or influenced you and your business that made you change the way you think and do your business?
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I am already in the business for more than 30 years, so I have gone through the various phases of crisis. As for the racial riots, it was before I set up the company, it did not impact me as such. Then the crisis that impact us most were the Financial crisis in 1997 and the SARS outbreak. The 1997 crisis was the worse that we ever encountered. We had a company in Indonesia then and we had to close shop after the looting and incurring bad debts there. At the same time, we went over to China to set up a new branch. It was not easy, since we had to put in a lot of money. Then we were in the face of recession. It was tough with the depressed market in Singapore and we relied on China to fuel the growth. It was a tough decision to be in China, but we had to, as opportunity was there and we gathered our resources to be there.
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9. What are some of the challenges in starting a business from scratch?
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Before you go into a business, you must know what you are in for. The best is you have to know the industry that you are in passionately and determine the market that you are going in, your capacity and your confidence in selling to the market. You also have to ensure that you have the right type of products to supply to the market and do a lot of research. We were lucky in a sense that before the fast food came in, I was in the States, looking in the equipment that they were using. I went over to the manufacturers and secure the agency right. The agencies of these equipments have been with us for more than 30 years. You have to smell the opportunity and as a result, we have a number of so-called 'Rolls Royce' lines in this industry.
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10. Who/What motivates/inspires you?
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It was just ad-hoc decision that I wanted to go into business to became the master of myself. The only person that impact me on the business was Dale Carnegie at that time. I read his books and somehow he made an impression. I was a shy person before and the books taught me to break out from my shell and instill the confidence in myself.
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11. Tell me about the first few customers and the first few years of business. How do you retain customers?
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The first customer was Singapore Airport Terminal Services at Paya Lebar at that time, then the general Hospital. My first year in business was quite smooth, competition was not that keen, there were only our company and a few British companies. Maintaining relationships with customers was easy if you are able to meet their needs, because their needs are very precise and you have meet their expectation in service as well. If you are able to meet their demands, it would be easy. McDonald has been our client since they started, same thing for KFC and Burger king. Moreover the quality of the product must be good and they are among the most expensive equipment in the business.
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12. Please tell me some stories of your best day in business or your proudest achievement to date.
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The best day in business was getting the agency of Taylor ice cram machine. It was a hard fought occasion, where we had to fight with the more established British houses for the agency. We have nothing to show them, except our passion and knowledge. As a result, we managed to win them over and with McDonald's and Yoahan in the market, we were able to create waves in the ice cream industry, which later generated most of our capital. The rest is history. The margin was reasonable then and the competition was not strong. Taylor chose us, because we had fire in our belly and we proved it to them that they were right in their decision. Later, we went into hotel projects, where the margin was thin and capital intensive. and for obvious reason it was not a big part of our business. So we retain what is good and do less on what is not good. Hotel projects are very seasonal and we would ride with the trend.
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13. Do you recall your worst day in business? Have you ever felt like giving up?
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Of course there was worst day. It was during the Asian crisis, where we suffered a big loss from Indonesia, We also just bought this factory at the peak price and suddenly there was a deflation of assets value and the bank asked us to top up to the depreciated collateral value. However, we believed in ourselves and keep moving so we could get through from the situation. At the same time our operation in China required us to pump in more money to fuel the growing trade. Although there were great demands there, because of the long cycle of trade we were unable to get local banks in Singapore to finance offshore trade in China. So in the end we had to be true to ourselves, we had let our customers trade directly with our suppliers and just received the service allowance which in itself was substantial. In the mean time, we were still providing a consultancy service. However, the situation has stabilized now.
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14. When was the moment you realised the business would work and support you?
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From the very first moment, in fact the best time was during the starting period, where the cost was low, the profits was reasonable and that were the time we expanded without much consideration. In fact right now, the cost of entry to this industry is not cheap, you need a huge capital.
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15. What are some of the things you have had to overcome to succeed?
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It was stressful during the recession and the SARS period which impact the financial position of the company coupling with the expansion in China. We need to cut down the inventory, reduced head count and changed the mode of trade to ride through the bad patch.
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16. What are some qualities that you feel you possess which differentiate you from someone who works for others?
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The ability to visualize, to look at trends ahead, such as going to China early, going to Vietnam early and going to Malaysia early, even before the government looks towards it. At that time the bank was not very supportive for offshore operation with its local restrictions and we have no choice but to grow it on our own resources organically.
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17. To succeed in business, what qualities are essential? What are some of the secrets in making a successful business?
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The quality that you must have is perseverance and the ability to make the right decision. In business there is always problems, do not evade them, but solve them and be truth about the problems to your partners and associates, you will be surprised that they are more understanding and will help you go through the problems.
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18. How do you get all the knowledgeable workers?
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We have to train them in-house.
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19. Have you ever thought of expanding the business in some way or in multiple locations? How and where?
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We are there, we are already in China, Hong Kong, Myanmar, Malaysia and Vietnam. In Indonesia we closed down in 1997, after incurring heavy losses. We have been in Vietnam for 10 years. Although in the first few years in Vietnam we were making losses, but we have the perseverance, belief and stamina to stay on, so is China, ultimately it will be successful.
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20. What aspects of expansion would you like to see for your enterprise?
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My hands are quite full, so I just develop the existing companies to their full potential. Of course I can set up in India or Middle East, but I do not have limitless resources. Vietnam and China are growing, so it is better to develop the business more. Moreover, China has a huge volume, but more competitive, while in Vietnam the players are not there yet, we are in an enviable pole position.
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21. In your opinion, how would you define entrepreneurship?
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An entrepreneur must be willing to take risk and believe in himself. He also has to have the tenacity to hold to his belief and gather all the resources available and leverage them from those who believe in him. He should put his heart and mind to solve whatever problems creatively.
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22. To what extent does ones educational level help or hinder entrepreneurialship?
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The higher you go, I would say it will impede the entrepreneurship fire. I started with A-level in my time, then I joined this British company and was quickly promoted. It was also became a good spring board for me to become my own boss. If I were to study and get a degree at that time, I would maybe too contented and not be taking that kind of risk, but to sit on a cozy job.
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23. As we try to select the final 2007 entrepreneurs, what qualities would you think a person should have to inspire others?
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Before anyone wants to venture into any business, one must know what he is in for, he must be able to calculate the risk. He also must be sure that the business that he is going in is well versed in, has a passion for it and sacrifice the time to grow up the business initially, there is no shortcut. It is hard work which can be inspiring too.
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24. What are some of your own values in doing business and what do you like to pass down to others, particularly the younger generation?
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In fact I have my son working for me, he has a computer science degree and also has an MBA from the University of Chicago. He opening up a new area of business in IT area for the food service. You have to change with the time and see what is relevant. You also have to differentiate yourself from the others.
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25. What advice would you give young people who want to start their own business?
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To be immersed in the industry that you passionate in, learn the industry before going in, Make sure that you are knowledgeable and should have the passion, also make sure to be capable to fund the business. For that you have to leverage on yourself, parents and of course if you are able to convince the banks, go for it.
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26. Do you foresee the future entrepreneurs conducting their businesses in a different way than entrepreneurs from the past 5 years? Why?
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Definitely, because we are now working in a very fast environment with the technology around, people also becoming very smart and therefore need more information. Entrepreneur has to know his type of business and his product well. He also has to rely more on IT. Learning curve becomes shorter.
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27. Do you feel that the future entrepreneurs have a higher chance to succeed than the entrepreneurs from the past 5 years? Why?
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It is more difficult in a mature economy like Singapore, but if he willing to plant himself in a less developed area or emerging markets, I think he can succeed better. Future entrepreneurs will face more difficult time in most established trade in Singapore. However, there are new trends and new products emerging, hence spawning new niches. Only those entrepreneur who can mine such opportunities can survive.
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28. What do you think about corporate social responsibility? |
I think it is very important. What we make we have to give! |
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