An egg-cellent turn


  • SMEBiz
  • Saturday, 27 Jun 2020

Improving operations: Tan (right), seen here with his father, started the closed-housing system as he embarked on modernising the farm.

DESPITE his father’s dissuasion, Tan Leng Yee decided to take up the mantle at his family’s third-generation poultry farm Liang Kee Farming Sdn Bhd in 2003.

Armed with a degree in mechanical engineering and a master’s in industrial engineering, his father would rather he pursue a professional career.

“My dad, like so many rural fathers, did not equate the agricultural sector with success. To his mind, it was nothing to be proud of. He wanted me to set my sights on becoming a doctor or engineer, ” he shares.

His siblings went on to find their place in finance, chemical engineering and business. But Tan stuck to the farm.

His days are filled with clucking hens, chicken manure, eggs, animal feed and a lot of hands-on work, much like his growing up years spent on a 9-acre chicken farm in the former tin mining district of Kampar.

“As a teenager, I often dreaded long holidays. During festive seasons like Hari Raya when the workforce took long leave for celebrations, I had to help my dad out, standing there at the egg sorting machine from 8 to 5, grading eggs, ” Tan recalls.

The long hours and manual labour have not deterred him. From the get-go, Tan sought to modernise the farm, which has now expanded to 95 acres, to improve the family’s commercial egg production and animal feed and organic manure manufacturing operations.

Growth potential: Tan is looking to increase its free-range eggs to 30% of productionGrowth potential: Tan is looking to increase its free-range eggs to 30% of production

He started converting the farm to a closed-housing system, implementing better rearing methods, feeding systems and risk management.

One of the noticeable results from this was the drastic reduction of strong manure odour. The ventilation system was enhanced and faeces cleared within 48 hours. They also topped the hen feed with certain good bacteria to promote stronger digestive systems to further reduce malodour in the chicken housing.

This, notes Tan, is a far cry from how farms used to be: foul smells permeating the air, poultry faeces cleared once a month and flies, maggots and dead chickens a constant bother for farmers.

It wasn’t an easy job convincing the family to embark on this change. The ways of the farm have been around for a long time and getting everyone on board the path of sustainability, profitability and modernity was a challenge. Additionally, Tan had to have his hands in every part of the operations as the company worked on the changes.

Eggs galore: Liang Kee’s egg production, sold under the LK Fresh brand, goes up to 500,000 a dayEggs galore: Liang Kee’s egg production, sold under the LK Fresh brand, goes up to 500,000 a day

“Liang Kee Farm is a small-sized company and I really can’t afford to hire a management team. There are non-stop dealings which I must personally handle, from planning, marketing, reading and writing business reports, dealing with suppliers, operational problems, and customer feedback. And farming on a small scale is also about putting in ‘mental hours’ beyond the physical kind, ” shares Tan.

But his insistence helped steer the company to its current trajectory. Today, Liang Kee’s egg production – sold under the LK Fresh brand – goes up to 500,000 a day. Aside from chicken eggs, LK Fresh also produces quail eggs, salted duck eggs, century eggs and fresh duck eggs.

Apart from upgrading and automating its operations, Liang Kee has also been investing in research and development (R&D) over the years. Tan says that good branding and a unique product are needed to differentiate LK Fresh from the commodity eggs in the market.

Although initially clueless about where to start, help came in the form of local researcher Prof. Dr SW Yeong as well as collaborations with other partners such as ExcelVite Sdn Bhd. This led to the production of Liang Kee’s current top product in the market, low-cholesterol eggs that are enriched with tocotrienol and mixed carotenes.

About three years ago, the company also ventured into the free-range system where laying hens have free access to an outside range for at least 6 hours a day. The pilot project started out with 300 chickens.

Last year, its free-range eggs became the first in Malaysia to attain the Certified Humane Raised and Handled certification from international experts. Tan believes that by handling farm animals with the best care, his products will eventually find their way into consumers’ hearts.

“As consumers are becoming increasingly aware about food production, many want assurance of the methods of agriculture used in food production, before meals even reach their dining table, ” he says.

He adds that free-range eggs have taken off among health-conscious Malaysians and are gradually becoming a premium in the urban lifestyle.

Currently, free-range makes up less than 3% of Liang Kee’s egg production. Tan hopes to increase this to 30% but notes that there is still a lot of R&D work needed for this product range.

“We are focusing more on nutrient enhanced eggs and no antibiotics eggs.

“Moving forward, we will spend more time and money into R&D to develop our downstream business that uses our eggs or hens by value-adding and extending their shelf life. This would also enable us to do something for the export market.

“Then we won’t have to waste our products when we have excess or be forced to sell the low quality eggs which would jeopardise our brand image or human health, ” he says.

Liang Kee’s revenue has slipped a little to below RM25mil in recent years due to low prices of eggs. Notably, prices of commercial eggs fluctuate according to supply and demand.

However, Tan says sales of its branded nutrient-enhanced eggs have grown steadily and buffered the general drop in egg prices.

He says there is also growing interest from the food services industry for its specialised eggs.

“We were getting enquiries earlier this year before the movement control order (MCO). A lot of hotels, fine dining restaurants and bakeries were already interested in our nutrient eggs and some will even go further and support humane farming which is the trend now.

“Unfortunately, most of these businesses were affected by the MCO and stopped ordering. But now they are slowly coming back. We will keep increasing our free range eggs project as retailers and hotels grow to support them. Luckily, we are still the only farm that is doing it according to standards, ” he says.

Tan believes that Liang Kee’s three-generation legacy, required certifications and good practices will continue to give it an edge in the market despite its small size.

Additionally, the company has spent the last two years building its social media presence to engage directly with consumers. Tan points out that, like most other advanced consumer markets, Malaysians are increasingly interested in how food is produced from farm to table.

The father of four also tries to instil this interest in his children, finding every opportunity to share lessons on sustainable farming with them.

“I show my eldest son how workers pack chicken manure and the amount daddy pays them per pack (50 sen), while standing in the middle of a mountain of poop. I have them use this amount to divide by what they want to buy. I want them to know the work daddy and his employees put in to produce food for them, ” he shares.

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Automation , R&D , Liang Kee Farming , chicken , eggs ,

   

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