Alliance Bank (M) Bhd: How Does A Start-Up Ensure Its Survival?
Budding young entrepreneurs share their insights on this
By the time a business enters into its growth stage, it usually starts producing a steady revenue stream.
So how do start-ups sustain their growth and consequently ensure their survival?
Leaderonomics decided to look at the local SME landscape and had the opportunity to speak to five Malaysian start-up founders on their business growth strategies.
These founders are among the 20 finalists of the Alliance Bank SME Innovation Challenge 2016, who are in the running to elevate their businesses.
Happy Bunch
After two months of conceptualisation, primary schoolmates Joanne Ho (pic right) and Beh Lee Yen launched their florist company, Happy Bunch, to address the gap they saw in the local floral delivery industry.
With an aim to make the gifting of flowers a simple, convenient and affordable process, they created a business model which curates one amazing arrangement of flowers that changes daily, at an affordable price.
Since the company’s inception two years ago, Happy Bunch has grown from delivering a mere 10 bunches (or smiles as the founders call it) a day during its testing phase, to a couple of hundred bunches a day within the Klang Valley.
According to Ho and Beh, the key factors for a start-up to grow successfully is to always keep in mind the company’s core values and to build the right foundation.
To elaborate, Beh said, “It’s kind of like building a house. If you are building a small house, you only need small pillars. But if you were to build a bigger one, you would need bigger pillars. If the proper support is not there, you may be able to grow big, but you won’t be able to support the weight.”
The duo articulated that strategic planning i.e. a combination of strong partnership between the co-founder(s), having the right supply chain and investors in place, and keeping close tabs on the company’s financials, are critical to ensuring a company’s sustainable growth.
Ju Xiang Food Industries
Ju Xiang Food Industries is a traditional Chinese meat jerky manufacturer and retailer with humble origins in Sandakan 20 years ago.
In order to remain relevant and to ensure sustainability of the business, Ju XiangFood Industries was rebranded in 2013, and has now grown to become the largest retailer and manufacturer of Chinese meat jerky in Sabah under the helm of its second generation owner, Jackson Tang.
While still maintaining the existing business, Tang is also diversifying the business as part of his strategy, by targeting the Muslim market and the younger generation to give the company a competitive edge and to ensure its sustainable growth.
Due to the fact that consumer behaviour changes from time to time, he iterated that it’s vital that the business strategy changes according to consumer needs with thorough planning and organisation. Otherwise, the business would not be sustainable.
Tang advised that while you may assume your product is something that consumers may want, it may not necessarily be what they need.
“This is why every time when it comes to a new product, I not only think of how amazing it can be, I also consider if it addresses core consumer needs,” he said with regards to his own business strategy.
Maideasy
It is not uncommon to catch wind of the wild tales of live-in maids in Malaysian households.
Azrul Rahim and Meriza Anna Mustapha (pic) (husband-and-wife team), and Hasrimy Hassan, share the same sentiment and decided to start a business to address the need for reliable maids.
Maideasy is a convenient (and cost-effective) way to book a part-time cleaner for RM20 per hour via the web or a mobile app.
Based on her 10 years of experience in the software development and entrepreneurship industry, Meriza couldn’t help but stress on the importance of strategy and understanding of the consumer behaviour in the market one is looking at, particularly in terms of culture and geography.
It’s not ideal to mimic another company’s business model from abroad, no matter how successful it is.
Meriza relayed that this won’t necessarily work in the Malaysian context as the consumer behaviour here is different.
Since the company’s inception in 2015, Maideasy has carried out more than 15,000 cleaning jobs. They are currently undergoing expansion efforts to Johor Bahru and Nilai. Now, that’s rapid growth!
To ensure the development of the business is sustained, Meriza noted, “In the long run, [you need to determine if] you are getting repeat customers.”
“If it’s a good business, it means that you’re solving a problem that people are willing to pay for again and again.”
Microbs
A lack of awareness on effective waste management among business owners, the prevalence of ineffective waste management products in the market, and costly and environmentally hazardous methods of waste clean-ups: these are some of the reasons why brothers John-Ian Oei and John-Hans Oei decided to start Microbs.
What began as a company that sells a product that can effectively break down organic waste at accelerated speeds, has now evolved to become a total waste solutions provider that does site visits, consultation, product education and customised solutions, just to name a few.
With regards to diversification, which is vital for the growth of any business, the younger brother of the two, John-Hans (or Hans), conveyed that different sets of clients have asked for assistance in resolving other issues such as ineffective product design and systems.
That was when the brothers knew they had to adapt their business according to the clients’ needs and tailor the business’ growth towards that.
Money is good for the business, but to sustain it in the long run, it’s about the value you can provide [to the clients], Hans said.
Aside from adaptability, Hans noted that having strong leadership is vital for the growth of a start-up. The ability to influence the current generation of business owners—to change their mentality towards responsible waste management—is important to Microbs.
Nutri Brown Rice
Despite the high nutritional value and health benefits brown rice offers, some refrain from consuming brown rice due to its chewy texture and lack of taste.
Developed through a combination of the finest brown rice from the rich paddy fields of Northern Malaysia and a high technology processing innovation, Branden Kuan (pic right) and Albee Heng brilliantly came up with a brown rice instant beverage packed with whole grains, natural vitamins and minerals. A concoction so smooth that even a three-year-old would ask for more!
“Strategically, a business owner must first develop a great product that is able to resolve consumers’ problems and inspire people, and then secure a team that is highly capable with complementary strengths,” Kuan relayed when asked about what is vital to a business’ growth.
In the face of competition, Kuan believes that growing the business through the right strategy is key to creating a differentiation factor.
“When you’re at the peak of your business, you must start to think out of the box to create another differentiating growth strategy. We can’t become complacent. Although we [may] think we are better than our competitors, we must always push forward so competitors are unable to follow what we are doing.”
With presence in Malaysia, Singapore, Hong Kong, China and soon in Europe, the company has demonstrated exponential growth in its fourth year since its inception.
Keeping growth at the forefront
While the nature and business model of every business is different, several key factors come into play in ensuring the growth of any business is sustained.
From our conversations, it can be deduced that it takes a combination of understanding one’s consumer behaviours, laying down the right foundation and values, having strong, impactful leaders, and continuously innovating one’s products, to not only spur the growth of the business, but to take it to greater heights and make a sustainable impact on customers.
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