MBG Fruits: A fruitful business

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  • Monday, 10 Sep 2012

Growing fast: MBG’s outlet at Sunway Giza mall. The company plans to have 45 outlets in Malaysia and 40 outlets overseas by 2016.

AN APPLE a day, keeps the doctor away is an age-old saying that most of us would have heard at least once in our life.

Fruits, undoubtedly, are needed for a healthy diet as they provide essential vitamins and minerals, fibre and other nutrients.

It is also a multi-billion dollar business that is thriving as cited by the IBISWorld’s global fruit and vegetables processing global market research report.

The report stated that an increase in demand for convenient prepared meals, growing health and nutrition awareness, increased significance of branding and greater competition from private labels have largely influenced the growth of the industry over the past five years.

“These factors have had varying effects on industry revenue, which is expected to grow at an annualised 0.4% over the five years through 2012. Revenue is forecast to grow by 2.4% in 2012, to reach US$164bil (RM510bil),” the report said.

The projected growth of the fruit industry is definitely good news for MBG Fruits Sdn. Bhd, a homegrown fruit retailer that has been making waves locally and across the region.

Humble beginnings

MBG Fruits started more than 60 years ago by Adnan Lee’s grandfather, who migrated to Malaysia from China.

In the beginning, Lee’s grandfather opened a small stall at Petaling Street — a trading centre in the city for local Chinese businesses.

When Lee’s father Ying Cheong took over, the business moved to the Bukit Bintang wet market. The market was later demolished and moved to Jalan Imbi to make way for Lot 10 shopping centre.

“It took a long time for our customers to come to the new location,” said Lee.

“We moved around using mobile carts attached to a bicycle to get customers. We did not have enough money for a motorcycle,” Lee said.

“My father went around Jalan Bukit Bintang and Jalan Alor to sell fruits. My mother, at that time, would sell fruits in a stall at the Pudu market,” he added.

Third generation charm

The family persevered and it wasn’t until 1994 that Lee got involved with the business full-time. He was only 19 back then. Lee, who is currently occupying the role of managing director in the company explained that he was already familiar with the business as he has always been helping out at the stall.

“I stood out from other fruit sellers at the market,” said Lee who stands at 1.9m.

“People called me kou lou (tall man in Cantonese) and that was my identity,” Lee said.

Lee, who was always fascinated by art and design thought about branding and the need for a company identity.

“MBG stands for money back guarantee. Back in the day, customers would ask me if my fruits were sweet and I would always say of course they are! Money back guarantee!” Lee said with a chuckle.

He further added that his stall was the first stall to have a logo and visible branding at the market.

In 2001, the company was incorporated and four years down the road, the company opened its first store in Avenue K, Jalan Ampang.

“It was by chance we opened our first outlet in a shopping mall. A customer of mine suggested it and it happened so quickly,” Lee said.

The self taught business however found out the perils of operating in shopping complex quickly.

“My first year, I incurred losses but I learned a lot. And that was the stepping stone. Other mall operators approached me to open an outlet at different locations. This prompted me to educate myself on retail business,” Lee explained.

The business grew at a rate of three to five outlets a year in shopping centres and to date, MBG Fruits has two outlets at Pudu Market and Imbi Market and kiosks in 18 shopping centres across the Klang Valley. They are also present in China.

Synergy and forward thinking

MBG Fruits classify themselves as 100% fruit retailers. They do not intend to plant their own products.

“We work with local farmers and suppliers. This gives us an advantage when it comes to quality control,” Lee said.

MBG Fruits purchases fruits worth RM3mil every month to meet consumer demand.

The company has also diversified their business by offering customers a variety of products: cut fruits, fruit juices, fruit salads, fresh fruits, delivery services and fruit baskets.

The company has also invested RM4.5mil for a new headquarters in Kota Damansara.

The spanking new outlet houses MBG Fruits’ online division, delivery service and the management team.

The company has a total of 190 employees including frontliners however expect this figure to double in the near future.

The company plans to have 45 outlets in Malaysia and 40 outlets overseas by 2016.

“We already have a presence in China with our outlets in Xiamen province but we are also looking at the Middle East and Indonesia,” Lee said.

Lee is also a firm believer in human capital retention. The entrepreneur plans to start a program that will benefit his employees in the near future.

“Some employees may have reached their maximum productivity level. It is important for a company to identify that and give them an opportunity to increase their output, “ Lee said, who plans to introduce profit sharing for his employees by 2020.

Many mom and pop shops have grown into international businesses over the years and most of them are living the Malaysian Dream. Malaysia is definitely a land of opportunities for those who work hard, persevere and dream big, as shown by MBG Fruits.

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