Yeo Hiap Seng (YHS) was founded by Yeo Keng Lian in 1900 to sell soya sauce in China’s Fujian province. Some years later, the family shifted to Singapore and established their Yeo Hiap Seng Sauce Factory. Their business model evolved and the family started to sell a range of food and beverage products.
Yeo Hiap Seng Ltd (SGX:Y03) was listed on the Singapore Stock Exchange in 1969. Yeo Hiap Seng Limited is a subsidiary of Far East Organisation Pte. Ltd.
YHS engages in the manufacture, marketing, distribution, sale, and export of food and beverage products in Singapore, Malaysia, and other countries.
The company offers Asian drinks, including ready-to-drink tea, soy drinks, and juice drinks. Their portfolio includes YEO’s beverages, YEO’s food, H-TWO-O Original, Sparkling H-TWO-O, Pink Dolphin, and Justea. YHS works with agency brands such as A1 A.K.Koh Enterprise, Celsius, Dairy Champ, Hain Celestial, Tao Ti and Uni-President.
YHS adopts a stringent sourcing process for their brands to maintain taste consistency over the years. For example, their beans are bought from Canada and shipped to their plants in Singapore and Malaysia whereas their staff are flown to Hangzhou, China to select the chrysanthemum blooms.
In 2015, YHS hired Mr. Teo Tzai Win, Melvin, as their new Chief Executive Officer after their then-CEO Mr Tjong Yik Min announced his retirement. Mr. Teo is a banker by profession with a broad range of experience in banking functions such as corporate finance, private equity, and operations.
Yeo’s markets themselves through several approaches such as product message on high-traffic areas such as SMRT in-train windows, newspaper and social media channels. Notably, for 13 years in running, Yeo’s sponsored S.League which allowed their H-TWO-O range of beverages to gain strong brand visibility during football matches via placement on jerseys and other appropriate placements. The brand is synonymous and gained a strong foothold among the football community in Singapore. Yeo’s also sponsored Singapore marathoner Soh Rui Yong who became the brand ambassador of Yeo Hiap Seng.
YHS lost the exclusive bottling agreement to Etika Beverages to bottle, sell and distribute carbonated drinks such as Pepsi, Mountain Dew and 7-Up. The agreement will officially ease on 31 October 2016 and it is expected to affect their earnings negatively.
Etika Beverages has an existing 40-years relationship with PepsiCo franchise in Malaysia to do distributions for Pepsi, Mirinda, 7-Up, Mountain Dew, Sting Energy Drink and the Tropicana, Lipton and Gatorade ranges.
Their raw materials are expected to increase because items are priced in US dollars.
YHS is growing by the way of factory expansions in two countries and moving forward, they are being more responsive towards consumer trends.
YHS started the construction of their factory in the Phnom Penh Special Economic Zone to cater to the growing demand in Cambodia. At the same time, the existing Johor Bahru factory has grown out of capacity. To cater for the growing demand, a new factory with a finished goods warehouse to reduce shuttling costs for inventory movement between the factory and existing warehouses.
In addition, YHS started replacing critical equipment to improve operations and reduce costs. The management is also launching a few initiatives to grow strong employee loyalty through a conducive and innovative workplace.
“Take care of your employees and they’ll take care of your business.” – Richard Brandson
(source: Company Website, The Straits Times)
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