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 To a pessimist, the
Chinese character "crisis" means danger and calamity.
However, to a positive-thinking person, the word is a source of power.
Does the symbol on top of the Chinese character 「危」 look like another
Chinese character 「力」but
deformed after it has exhausted its power? When looked at this
way, the word "crisis" can be considered as a character
that traps 「厄」inside
of it with last breath. The latest interpretation of the word
"crisis" is that without crises there are no opportunities.
In fact, it is an alternative encouragement. If a real case is needed
to demonstrate this new aspect, the success of Mr Luk, who is well
known in the metals industry, and his KTB Ltd. began with the word
"crisis.
Shanghai
merchant turned crisis into a favourable development
Established more than 50 years,
the success of its founder Mr Chen Luk and its second-generation
management team is the result of continuous conscientiousness to
survive during adversary and dangerous environment.
Before China became a People's Republic, Mr
Chen Luk was already a successful merchant in the then thriving Shanghai city
due to his bravery and insight. He traded in daily necessity
goods such as bicycles and tyres which were considered contrabands by
the Japanese occupation authorities. In 1949, he began dealing in
axles in Shanghai
for the reason that these products were necessary in manufacturing.
Of course, the products dubbed as「啤令」by Hong Kong people gave him
the first taste of success. This is the reason why he gave his first
son the name「培林」which
sounds like 「啤令」when
spoken in Mandarin. Sensing the political instability, Mr Luk came to
a new place Hong Kong in 1953 to
start it all over. Arriving in Hong Kong,
he went back to his old business - trading in bearings.
In 1956, he invested 50
thousand dollars in Central District to begin Bearing Business.
Working
hard to turn crises into opportunities
At that time, most of the
bearings were handled without an agent but through foreign-owned
trading houses call “HONG”, people in this business had to share the
profit with these trading houses and had to avoid locking too much
money in inventory. Because of this, Mr Luk worked much harder
than anyone. He was willing to match every order each time by adding
to his inventory to ensure his shop had just enough inventory without
tying capital in it. He knew that he had to rely on
foreign-owned trading houses to keep his business going by selling in
bulk for small but more frequent returns, despite that they would
share his profit. In fact, foreign bearings suppliers wanted to sell
direct to users bypassing foreign-owned trading houses, but the
agency system did not exist then. Later, Mr Luk took advantage of low
interest rates to buy directly from overseas manufacturers, marking a
beginning for KTB Ltd.as an agent for famous bearings bands. Because
of courage and insight, he further increased his stock when Hong Kong dollar interest rates were low and
foreign currencies rose in value. As a result, Mr Luk made
considerable extra profits.
Order sizes of bearings at that
time varied significantly, sometimes in an amount of a few thousands,
sometimes in a 5-digit figure. Therefore, businessmen would not hold
too much inventory. Likewise, delivery lead times also varied a lot,
from 2 to 3 months to 6 months or even 1 year. Mr Luk thought to
himself that to win in this business, he needed a variety of products
to avoid lack of products so that customers would repeat purchase.
Since then,, he made it a motto for the company that there must
always be a complete line of products to fulfil every customer's
demand.
A Suave businessman better than
a miser
It is unusual to have no crises in doing business. It is particularly
so if business is getting bigger.
Riots occurred in Hong Kong;
Mr. Luk not only traded in bearings but
also acted as agent for manufacturing machines. Small and light
industries began to take off in Hong Kong
and other Southeast Asian countries at the time. Orders flooded in
like snowflakes. No sooner had the machines arrived than they were
put on freight for shipment. It can be said that Mr Luk's
family expanded further because of a crisis. Luck did count but
working so hard in 360 days a year is rare.
Perseverance is important in
business. Because of this attitude, KTB overcame another crisis.
Tackling
dishonest businessmen from China
The
opening up of China's
market should not be good news to companies like KTB. Even the CEPA
cannot help them. As a matter of fact, growing demand for bearings
due to industrialization in China fostered a domestic
imported bearing market. This without doubt affected Hong Kong's companies that sold the same.
However, KTB instead of seeing its business shrink grew further.
Although the threat came from China, it took a Chinese
to resolve it. Since there was a huge demand for bearings in China,
the market was full of counterfeits. Some counterfeits traded as
steel bearings but they were really made of ordinary iron. These
counterfeits posed great danger to and ruined the machines. If the
machines broke down, production has to stop. Factories selling these
machines can bear the time and money to repair them but for those who
need the machines for production will suffer not only money and time
but also reputation. The cause of these problems is merely an
inferior bearing.
The Second Generation decided
to take the business further north in China
for long term growth in spite of the fact that KTB has already built
a good reputation in Southern China.
The new management believes key
to a successful business is to listen to good advice but only those
who work conscientiously can attain real success.
Caption:
KTB is the agent for many
world-famous bearings, including German brands (FAG, INA, GMN, STIEBER, RINGSPANN),British brands (RHP, WESTON, COOPER, SNFA), French brands (SNR, NADELLA), Swiss brands (RMB, WIB), American brands (TIMKEN, TORRINGTON, MORSE, FAFNIR, MRC, McGILL, RBC,
DODGE, SMITH, KAYDON, LINK-BELT, LOVEJOY) and Japanese brands (NSK, IKO, EZO, OZAK, JAF, FYH, TSUBAKI, MTR, DAIDO). In the very
beginning, the Japanese came to ask Mr Luk's family to be their
agent. No one then had ever thought about that the quality of
Japanese brands could one day surpassed that of the American or
European brands.
KTB's
second generation management team, inheriting their father's hard
working attitude while injecting dynamics and new way of thinking
into the group.
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