Navigating shutdowns and slowdowns

  • SME
  • Saturday, 16 May 2020

Sales increase: Merry Me’s Kee (left) and Choo saw revenue grew as they moved online.

THE disruption brought on by the Covid-19 pandemic has weighed on businesses across different industries. Even as businesses reopen, they continue to face challenges amidst a weakening economy.

As SMEs pick up the pieces, several companies shared with SMEBiz their experiences over the last two months and their plans to mitigate and adapt to the challenging business environment.

Medical Devices Corp

Founded in 2007, Medical Devices Corp is a manufacturer of portable peritoneal dialysis machines. The company has a history of being among the breed of local pioneers in new technologies and designs, making it one of the most innovative Malaysian firms in research and development of medical devices.

With the coronavirus still raging across the world, Medical Devices Corp is now looking to commercialise the production of new face masks with filtering technology, says founder and director Loke Khing Hong.

Long-term view: Ant Futures’ Wu sees potential demand in alternative food sources like crickets.Long-term view: Ant Futures’ Wu sees potential demand in alternative food sources like crickets.

Loke says the company is currently working with a small group of scientists and researchers from Germany and Poland to patent the prototype and get the final nod from the World Health Organisation (WHO) to start production of this filtering technology for protective masks.

While the technology it aims to commercialise is not new and has been used by industries such as biotechnology and space sciences, Loke says established mask manufacturers have largely overlooked this filtering device given the urgency of getting out suitable personal protective equipment (PPE) to medical frontliners in the midst of the outbreak.

He adds that the N95 masks that are widely used by medical personnel are not very effective in filtering out the virus.

Therefore, the timely commercialisation of this technology for mass production will be critical in the coming months as countries continue efforts to flatten the curve.

Medical Devices Corp plans to start manufacturing the new masks at its existing plant in Perak soon and this will not only help with the fight against the outbreak, it will also, hopefully, keep the company on its innovative and profitable path.

Ant Futures

One of the more interesting ventures among Malaysian startups, Ant Futures jumped into the cricket farming business in 2018 with the idea of helping the world wean off meat as the main source of protein.

The company makes cricket-based snacks and alternative protein food under the Ento brand and was in talks with several potential strategic investors to expand its manufacturing facilities and penetrate new export markets just before the Covid-19 pandemic struck, putting a halt to these plans.

Retail boost: Sunshine Kingdom is optimistic that Chinese tourists will return. — AFPRetail boost: Sunshine Kingdom is optimistic that Chinese tourists will return. — AFP

However, founder and chief executive officer Kevin Wu Khing Woon describes the company as being battle-hardened. After all, it has spent a lot of time dealing with doubters on the merit of its business and convincing the public to take a bite into crickets as a healthy alternative snack.

Ant’s cricket farm and manufacturing plant were allowed to operate during the movement control order (MCO) as the company falls under the food production category.

During the period, it moved its entire non-farm operations online, including the marketing of its products through online platforms and engagement with its retailers and customers.

Despite the public’s negative perception towards cricket-based snacks, Wu says the company remains committed to pushing out alternative, sustainable food sources.

He adds that there are many environmental benefits to having crickets as a food source as farming takes up 14 times less land, 15 times less water and 12 times less feed compared to other farmed livestock.

If they keep at it, Wu believes they’ll find long-term success.

Newleaf Plantation

Durian plantations were all the rage before Covid-19 came along.

Every big player in town was eyeing the China market and deployed new farming technologies to boost production.

To the dismay of many, like Newleaf Plantation, this will be the first time a major export season for durian is affected in such a big way.

Plantation players are waiting to see what the ex-farm prices for the thorny fruit will be, which will be partly determined by demand from exporters.

Demand from China remains uncertain.

Catering to the new normal: New workplace trends will boost Accendo’s future growth.Catering to the new normal: New workplace trends will boost Accendo’s future growth.

Managing director Kenny Wan shares that Newleaf’s plantation operations were mostly unaffected in the initial phases of the MCO while marketing and administrative activities were done remotely.

But with the coronavirus affecting practically every major export market, Newleaf is now revising its distribution strategies.

One of its key options is to build an online platform and start farm-to-home delivery services within Malaysia in time for the upcoming fruiting season to make up for any potential drop in exports.

Newleaf has also started exploring possible expansions downstream by collaborating with specialist food manufacturers to make Musing King-based desserts such as snowy skin frozen durian paste mochi and cakes to utilise its capacity.

Accendo HR Solutions

Specialising in software and technology for human resources management, Accendo HR Solutions builds the necessary software and systems needed for the coming transformation of work and workplaces in a new normal.

But even for Accendo, founder and managing director Sharma Lachu admits that the first two weeks of the MCO was a challenging time for the company as everyone grappled with the new reality and concerns over the seriousness of the pandemic.

The company moved all its operations online and arranged for staff to work from home.

However, the focus has now turned to helping its clients in dealing with the transformation and restructuring of their human capital and talents.

Accendo relies heavily on technology, data and behavioural science in its approach to HR solutions. Some of the tools it is currently developing include artificial intelligence and HR management systems for corporate clients.

Being involved in analytics, Sharma says Accendo is able to adapt and pivot fast towards new trends and requirements for today’s business environment. More importantly, he notes that the company’s ability to make timely decisions to meet the requirements of the new situation remains intact.

Ice Estate

The Covid-19 pandemic struck right at the core of Penang-based Ice Estate, which makes the Merry Me Ice Cream. Its business model, anchored on spreading joy at special occasions, was rocked as people cancelled celebrations and shut their doors during the MCO.

Before the pandemic, its catering and event services flourished with three to six events per week. They were even planning to expand into the retail business with ice cream kiosks in the Klang Valley.

Instead of wallowing in their losses, co-founders Joey Kee and Stanilaus Choo took the initiative to keep business going through online delivery since they already have a range of unique ice cream flavours such as tau sar piah, teh tarik and tau fu fah.

However, they note that the commissions charged by third-party delivery platforms ate up a big chunk of the company’s profits. To overcome this, Merry Me Ice Cream gathered its resources and network to carry out deliveries without going through those delivery platforms.

As demand for their ice cream grew, the marketing team kicked up advertising a notch and they were able to generate 30-40 orders per day, some days going up to 70 orders, throughout April.

This helped bring back a six-digit income for the company.

Ice Estate also expanded its delivery services to KL with the help of a cold chain logistic partner.

In the third phase of MCO, its marketing team decided to also start a “Reselling Campaign” to help others generate income. The campaign creates a unique link for home-bound individuals where sales through the link will help channel them a commission.

Sunshine Kingdom

As a retailer of Malaysian specialty food products for tourists, Sunshine Kingdom’s business is closely tied to the retail and tourism industries, both of which are among the most severely hit by the Covid-19 pandemic and the subsequent lockdowns in Malaysia and many parts of the world.

The reopening of businesses since early May has brought some comfort to the owners of Sunshine Kingdom. Its store in Central Market, a key tourist hub in the heart of the city, has opened its doors with the relaxation of the MCO.

However, demand remains slow.

The fact that the management of Central Market has waived rental fee for the month of April provided the company with temporary relief.

Aesos Lai, one of the co-founders of Sunshine Kingdom, is still optimistic that the business will see a rebound once travel resumes as Malaysia remains one of the top destinations for Chinese tourists.

As China gradually picks up, recent news of its domestic travels have been rather encouraging. Lai is hopeful that this will slowly reflect in international travels.

Instead of fretting about the tough times, Lai has made use of this down time to indulge in his musical interest to pen a song and a book as a tribute to healthcare and other frontline workers fighting against the Covid-19 pandemic.

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