The invisible man of beverages


  • Sme
  • Thursday, 07 Aug 2014

Ean Yong with the range of OEM products that his company produces for clients ranging from hypermarkets to direct selling companies.

In life, people are advised not to burn one’s bridges, but for Orgabio Manufacturing Sdn Bhd founder and executive chairman Ean Yong Tin Sin, burning bridges is a necessity in entrepreneurship.

“Life as an entrepreneur is hard, you have to keep looking forward and not look back at all,” he tells Metrobiz.

Ean Yong, who was already in his early 50s when he started Orgabio in 2002 to provide contract and private-label manufacturing for instant coffee and health drinks, certainly knows what it is like to leave a cushy corporate job when the company he worked for was acquired and restructured.

“Friends simply warned me there are no secrets to success in business. You just have to do what it takes,” he said.

He says he had six children still in school when he started the company and knew that more than 70% of businesses fail in the first five years, so he needed to be resolute in my actions.”

He decided to venture into the business as he had prior experience in the field and he realised that there would be a growing market for instant coffee and health drinks.

Coffee is seen as a drink that brings people together. The first coffee house opened in Constantinople in 1554, leading to the place becoming a centre for intellectual exchange.

Even today, many business deals between investors and entrepreneurs are made in coffee houses over a cup of coffee.

At the request of his customers, Ean Yong’s products are packaged in sachets that people can easily tear open, pour into a cup of hot water, stir, and drink.

Although it may lack the ambience of a coffee house or the smell of freshly brewed coffee, there is a growing demand for all things instant because of the fast pace of modern life.

The Washington Post, citing data from market research firm Euromonitor noted that worldwide sales of instant coffee hit nearly US$31bil (RM98.9bil) last year and is expected to achieve US$35bil in sales by 2018.

Continuing a tradition

Instant coffee was invented and patented in 1890 by David Strang of Invercargill, New Zealand.

Banking on a product line that has existed for over a century, Ean Yong mortgaged his house and applied for a bank loan and started the company with RM110,000 in working capital and a rented 3,200sq ft light industrial factory in Bandar Teknologi Kajang with five employees, who were mainly his family members.

The business, similar to original equipment manufacturing (OEM), mainly required investments in purchasing a used mixer, a single-line packaging machine and renovating the factory.

“Renovation plays an important role as we need to comply with the requirements of the authorities,” he said.

This includes creating a clean environment, similar to that of a hospital.

They have received the Health Ministry’s Good Manufacturing Practice (GMP) and Food Safety is the Responsibility of the Industry certifications.

Their products have also been certified halal by the Department of Islamic Development Malaysia (Jakim) for.

In order for the company to export their products globally, the company also has to have under the Hazard Analysis and Critical Control Point (HACCP) certification.

Some of their products are exported to Japan, China, the Philippines, Indonesia and Thailand.

Reiterating the conventional wisdom of the need to look at the bigger global market, Ean Yong said as the emerging markets become more affluent, the upcoming generation will be more adventurous and keen to try new products, including different coffee tastes.

To be successful in the business, hygiene standards during the preparation of raw materials to the finished product have to be met. The standards also cover the need for proper documentation, records and related training for the staff.

Apart from halal certification, which needs to be applied specifically for all new products, other certifications are applied for once but requires annual audit by the relevant authorities.

Family effort

Today, the company had expanded to a 1.3 acre plant in Bandar Tasik Kesuma Industry Park in Beranang, Selangor, and has 50 employees.

Four of his children, two daughters- in-law and his wife continue to help him to run the factory.

“This is not a sunset industry. I would have asked them to look for opportunities elsewhere if it was,” he said.

Their work involves looking for clients, which include hypermarkets and direct selling companies who have plans to market instant foods and beverages to the market under their own brand.

His team then studies the client’s requirement and then source for the ingredients needed and the packaging design.

“We produce samples for the client and they will test it until they are satisfied. There are instance where they require close to 100 samples to be used for focus-group surveys,” he said.

When the taste, ingredients and packaging design has been confirmed, they will send the sample to do lab test externally.

“This is where they will check for microbes, heavy metal and even the nutritional value of the drink,” he said.

With the experience of producing over a hundred OEM instant drink for various companies, they are planning to launch their own brand of instant drinks to cater to the tourist market.

“This would include unique taste, such as durian coffee that showcases the uniqueness of the Malaysian culture,” he concluded.

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