Louis Tan is a young and motivated entrepreneur who works hard for his success. At only 34 years old, Louis has already led a major turnaround effort to reposition Saudee Group Berhad to be a more competitive organization. At the same time, Louis has also helped boost the performance of Sima Frozen Products, a distribution company that he inherited from his father, from a RM 18 million per annum revenue to a RM 84 million per annum in just four years. Louis was recently inducted into the Young President Organization (YPO) – an invitation only organization which comprises the country’s most promising entrepreneurs or chief executives under the age of 45.
Louis traces the origins of his entrepreneurism to his time in high school. “I was a very active student back then where I held leadership positions in the Interact Club and the school prefectorial board. I was always given the opportunity to organize charity events where I would source products and sponsorships from local businesses and sold them in my school. I made quite a reliable source of profit for my school and clubs,” he says. Louis continued to serve in student senates when he was in his tertiary education. When he was in graduate school, Louis established a social business program that links a center for Down syndrome kids with his business school. “I would organized art events for the center. I would invite students in my school to participate in the event. We taught the kids how to make artworks like photo frames, greeting cards and so on. I would then take those artworks and sell them in my school. We gave back all the monies we made to the center,” he says. The program not only generated a steady income for the center, but it also bridged the gap between the school and the Down syndrome community. As a result, Louis graduated from his MBA with the Dean’s Medal of Excellence, an award bestowed to a student who not only excel academically, but also made significant contribution to the community.
Today, Louis serves as the Executive Director for Saudee Group Berhad, and as the Managing Director for Sima Frozen Products Sdn Bhd. Saudee is a frozen process food company that owns the brand “Saudi Gold” and “Farm Gold”. He joined the company in January 2012 as Chief Operating Officer, focusing on overall group operations and business development. During those early years, Saudee experienced turbulent times as the price war competition had put the company in a precarious position. Internally, the company lacked several fundamental elements. “We didn’t have an integrated management system. There was no visibility over key performance indicators. Besides that, we did not have the right people in the right positions, and those who were there were poorly measured. Worse off, the company did not have the right market positioning strategy. We were competing in the segment where we didn’t have any competitive advantage at all,” recalls Louis.
Soon after that, Louis initiated a turnaround strategy that started with the placement of a comprehensive management control system and placing the right people in the positions. Besides, the previous performance management system was also overhauled to provide the right motivation and purpose to the workforce. Initially, Louis found it hard to implement changes of that magnitude as most the staffs were uncertain about the new direction. “It is always hard to implement changes that touch on people’s pay. I was certain that I needed talented people in the
right place that thrive in the right environment. The only way I could do that was to manage the implementation process carefully and communicate with my staff regularly,” noted Louis.
The journey was still rocky for Saudee albeit the internal changes. The company had focused its sales in the lower end market in past. However, with more new entrants in the market for the past 10 years, the profitability of the company had already slid at an alarming pace. “I knew from the start this company needed to do things differently than the rest. We are not vertically integrated like our competitors. So our only chance of success lies on product innovation,” noted Louis. From the start of year 2013, Louis led a major changeover in the product offering. Poor performing generic products were dropped from the line-up, only to be replaced with new unique products that were able to withstand price competition. Besides, the company has also recognized the importance of branding and advertising under Louis’s leadership, hence switching the company’s emphasis to creating demand, instead of the previous approach of pushing products into market.
At present, Saudee has successfully built a formidable foundation that can enable itself to seize future opportunities. Years of continuous improvement have led to a tremendous upgrade to Saudee’s manufacturing capability. To date, Saudee has proudly served many prominent International brands and chain restaurants. Besides, the company is also the first producer that can produce liquid center filled products. “My goal is to provide the market with drastically different products. I would like my products, when placed in the retail shelves, to be distinctly unique compared to the ones from my competitors. We need to break ourselves from the price ceiling,” says Louis. In terms of company performance, Saudee’s turnover has been growing on an average of 12% for the past three years. The company’s EBITDA has also seen significant improvement since the restructuring. “We still have a lot to do, we are far from being comfortable. We need to accept that to succeed in this industry, the odds are still against us. But on the other hand, we can see our futures are gradually shaping up. Those are futures with endless potentials,” noted Louis.
Looking ahead, Louis’s mission is to help Saudee expand its footprint into the Asia Pacific market. “We have so far increase our export business from one country to five countries in the past three years”, added Louis. “With the greater demand for Halal products, I’m confident we will be able to open up more foreign markets in the next three years.”