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Turning to niche field for growth

The Straits Times by AW KWAN HONG, HARSIMRAN KAUR ARWINDERJIT SINGH, WONG KAR LYE AND XU ZIHAO

Starting with a single desk in borrowed office space and just one telephone line, Aik Soon Hardware has grown from being a general hardware dealer to become a specialist distributor of marine and industrial valves.

Founded in 1982 by Mr Quek Bok Teck, the family-owned business is now in the hands of the second generation, with two of Mr Quek's four children and a son-in-law forming Aik Soon's management team.

They continue to run Aik Soon with the same values and principles of customer-centrism that Mr Quek has practised since its inception.

When Mr Quek started the company, he believed that conventional price competition was not the way forward if he wanted his business to be sustainable. Instead, he believed in differentiating his products through quality service and customer focus, while remaining affordable to customers.

Shifting its business focus from general hardware to valves was the first step that allowed Aik Soon to focus its efforts in excelling in a specific industry segment.

The firm's flat management structure enables seamless business operations and quick decision making to fulfil customer demands.

All of Aik Soon's nine staff take on multiple roles. For example, its warehouse supervisor can stand in for its machinist and drill the flanges for valves should the latter be unavailable.

KEY TO SUCCESS

The amount of time it takes to build ideas into our successes can be discouraging at times, but moving forward with a positive attitude and hard work, success will definitely come.

COMPANY DIRECTOR LEE CHIN ANN, on how the firm achieves success.

Sales staff also help with delivery whenever needed. Company staff may even board vessels to check measurements, instead of waiting for a third party.

The lack of bureaucracy and the empowerment of staff to make ad hoc decisions with external suppliers has helped to facilitate the fulfilment of customer orders.

Aik Soon has gone beyond indenting goods for inventories through middlemen to being the distributor for major brands.

The company's ability to obtain components from suppliers directly and at any time gives it the capability to deliver orders to its customers on the next day if stocks are available. It offers complementary services such as valve modification and valve automation with electric and pneumatic actuators.

It also offers complimentary visits to clients' vessels during dry dockings for checks, and regularly calls up clients to ask if they have other issues.

A policy of relationship management aids in high retention of existing customers, while increasing its customer base through positive word of mouth feedback.

Aik Soon also differentiates itself through innovation.

In 2008, the company integrated accounting and inventory functions onto a single system, which helped to save time and effort in stock keeping and keep inventory minimal. Another example is the installation of Global Positioning System in delivery vans to maximise efficiency.

Aik Soon's next project is to fully automate its office and boost its storage management efficiency by tapping a new system that automatically tracks inventory, among other benefits.

Company director Lee Chin Ann said: "We have never been discouraged from being late adopters of innovation as we progress and reap from incremental innovative ideas."

In 2016, Aik Soon projected a substantial fall in revenue for the subsequent two years due to stagnation in the local valves market.

With a pickup in international oil prices, Aik Soon decided to seek opportunities in the overseas oil and gas, and marine industry, targeting Malaysia, Indonesia and Myanmar for their growth potential in these industries.

Over the past three decades, Aik Soon has established close relationships with reputable suppliers and is looking to form joint ventures. In this way, Aik Soon would be able to piggyback on established Singapore companies to venture abroad when opportunities arise.

This year, the company plans to leverage its experience to enter the Indonesian market.

Aik Soon's push into overseas markets is enhanced with its distributorship of two leading valve brands - Powell and Showa.

It also expects its overseas expansion to synchronise with its Singapore operation, which would not only act as headquarters, but also as an integrated coordination centre for functions such as training, logistics and marketing.

Mr Quek, the founder, once described Aik Soon's core principle as: "Treat others with sincerity, integrity and kindness, and stay grounded".

With that in mind, Aik Soon today is also a strong supporter of education, having contributed to various programmes, scholarships and funds in local universities.

The combination of these values, coupled with an adventurous yet prudent entrepreneurship, has led Aik Soon to expand from a rented office to what it is today.

Mr Lee said: "The amount of time it takes to build ideas into our successes can be discouraging at times, but moving forward with a positive attitude and hard work, success will definitely come."

•The writers are students at NUS Business School.