Section 2.
0 INTRODUCTION TO THE COMPANY
2.1 company’s name
Company Hup Seng Industries Berhad
Backgroun
d Vision and Mission
Vision
o Creating value together. To a better future.
Mission
o To offer tasty and wholesome biscuits, cookies, snacks and
beverages to consumers, safekeep the best interest of
shareholders and reward employees fairly.
percentage of Bumiputra’s share
No. Name & IC Position Share Value Shareholder
No. (M status
Shares) M % NB B
USD
1 HBS Group 408.00 100.00 51.0 NB
Sdn. Bhd
2 Norges Bank 22.67 5.22 2.83
Investment
Management
3 Statens 22.67 5.22 2.83
Pensjonsfond
Utland
4 Cekap 20.03 4.91 2.50 NB
Kapital Sdn.
Bhd.
5 Employees 14.12 3.46 1.77 NB
Provident
Fund Board
6 Chian Tung 13.73 3.37 1.72 B
Kerk
7 Public Mutual 10.58 2.59 1.32 NB
Bhd.
8 Eastspring 10.37 2.54 1.30 NB
Investments
Bhd
9 Swee Ching 8.04 1.97 1.01 NB
Chong
10 Keh Kerk 7.31 1.79 0.91 B
(Chu Koh)
(* NB – non Bumiputra, B – Bumiputra)
Figure 1.1 Shareholders information
date of registration
o 2 November 2000
date of operation
o 4 October, 1991
company’s registration number
o 226098-P
correspondence address
o 14, Jalan Kilang
Kawasan Perindustrian Tongkang Pecah
83010, Batu Pahat
Johor, Malaysia
telephone number
o +607-4151211
type of industry
o Food Processing
company’s other liabilities
Two external factors driving confectionery maker’s growth this year
But the biscuit and confectionery manufacturer is cognisant of the
uncertainties lying ahead, and it is, therefore, not putting high hopes on
being able to carry the momentum into next year.
“We don’t want to paint a robust or rosy growth picture because we are a
very conservative company,” Hup Seng executive director Kerk Chian Tung
says.
For much of 2015, it is noted that Hup Seng has been able to enjoy high
profit margins, averaging around 18%, and strong earnings growth due
mainly to what the company regards as the two external factors that are
beyond its control. These are the prevailing soft prices of crude palm oil
(CPO), which have helped lower the company’s production costs, and the
appreciation of the US dollar against the ringgit, which has helped boost
foreign exchange (forex) gains.
Growth catalyst
Notably, cream crackers have been the main product of Hup Seng since its
founding in the late 1950s by four brothers in the Kerk family
Based on current turnover, the Batu Pahat-based company is estimated to
control one third of the cream-cracker market share in Malaysia.
According to Kerk, Hup Seng’s turnover for cream crackers over the years
has been growing at a rate of 2%-4% annually in tandem with Malaysia’s
annual population growth of 1%-2%.
2.2.1 Technical Aspect
2.2.1.1 Product / Service / Technology Overview - Product Profile
a) Main product and future product.
Main product
Cracker
Our award winning and most popular product is none
other than Hup Seng Special Cream Crackers Cap PING
PONG. Since 1994, our Special Cream Crackers has
won the Gold and Grand Gold Award from Monde
Selection, an international and independent quality
institute founded in Brussels, Belgium. The quality, taste
and texture of the Special Cream Crackers is one of its
kind and has become a household name for many
generations.
Hup Seng Special Cream Cracker Cap PING
PONG
Sugar Crackers
Corneo Crackers
Wholemeal Crackers
Deluxe Crackers
Biscuits
For diversities, we also produce biscuits. We have
PING PONG Marie Biscuits that comes in a few
different flavours, PING PONG Sesame Biscuits
which is full of toasted white sesame that you can
see, smell and taste.
PING PONG Marie Biscuits
PING PONG Sesame Biscuits
KERK Sultana Biscuits
KERK Pineapple Biscuits
Cookies
Launched in July 2015, our latest pride is NATURELL
Oat Cookies that shouts OATS in every bite. They
come in three varieties – Original, Chocolate Chips +
Hazelnut and Chocolate. These rustic looking
homemade inspired oat cookies are NATURELL-y
unique. They melt in your mouth, taste delicious and
leave you wanting more.
Since 2016, all three varieties of our Oat Cookies
have been rewarded with the GOLD Quality Award at
the Monde Selection, Belgium. This is a recognition of
our continuing effort in producing world class quality
products.
NATURELL Oat Cookies
o Original
o Chocolate Chips plus Hazelnut
o Chocolate
Beverage Mix
Like cheese and wine, beverage and
crackers/cookies/biscuits are match made in heaven.
Crackers with coffee, cookies with tea, biscuits with
coffee or tea, these pairings are undeniably
complementary and absolutely satisfactory.
Coffee Mix
Ipoh White Coffee
Ginger Tea
Nutritional Cereal Drink
b) The strength and the uniqueness of the product.
Internal analysis of strength and weakness of a firm
emphasizes its strengths in terms resources that it
possesses and the ability the firm utilizes its resources to
establish sustainable competitive advantages, whereas a
firm’s weaknesses is its deficiency that hinder it to
achieve competitive advantage among other firms.
Throughout this sub-topic, we will use Value Chain
Analysis to conduct the analysis of Hup Seng Industries
Berhad strengths and weaknesses.
Value chain analysis is a tool that allows firms to identify
the operations that are deemed worthy and those that are
redundant, which increases the cost. If the value creation
is greater, ultimately the firm will receive higher returns in
their businesses. Value chain analysis can be divided into
2 categories:
Primary activities: Activities that is directly linked
with creation or delivering of products. For
example: Inbound logistics, operations, outbound
logistics, marketing and sales, and service.
Support activities: Activities that provide
assistance to increase effective and efficiency in
the market. For example: Procurement, human
resource management, technology development,
and infrastructure
Primary Description
Activity
Inbound Hup Seng inbound logistic activities
Logistics mainly focuses on selecting raw
materials producers, managing
supply chain management, building a
cordial relationship with its suppliers,
and ensuring the standards of the
production.
Operation As per 2013, Hup Seng is operating
in more than 40 countries in Asia,
Europe, America, Africa, and Mid-
Asia through company-operated
stores and other associated
companies.
Outbound Hup Seng outbound logistics involve
logistics selling its products through stores
and also through intermediate. For
example, Hup Seng cream crackers
and 3-in-1 In-Comix coffee sachets
are sold in supermarkets.
Marketing Hup Seng occasionally carries out
and Sales new product sampling in supermarket
to test the market but its marketing
activities are often taken care by
public via word-of-mouth
Service Hup Seng focuses heavily on its
superior quality production.
It’s top manufacturing services has
earned the prestigious MS
ISO 9002 Quality System
Certification and MS ISO 9001:2000
from SIRIM.
Support value chain activity.
Primary Activity Description
Infrastructure Hup Seng has a good
support in government
relation to sustain their
business. Other than that,
it has strong general
support activities such as
financial management
planning and other legal
advices to handle its
massive network and
associate companies
around the world.
Human Resource Hup Seng is making sure
Management that all its factory workers
are well equipped with
strong knowledge and
skills in production
process. The workers are
also being provided with
good working
environment, benefits, and
pay to create a strong
sense of belonging and
boost workers retention
Technology development Hup Seng depends
heavily on technology
development to ensure
premium quality of their
products and also to
improve efficiency in
terms of cost and
performance in
performing mass
productions of their
products
Procurement Hup Seng procurement
activities mainly focus on
purchasing coffee beans,
raw material for food,
machinery, and buildings.
2.2.1.2 Project Location
a) Location (Location map) (Appendix)
14, Jalan Kilang
Kawasan Perindustrian Tongkang Pecah
83010, Batu Pahat
Johor, Malaysia
b) Area and land status. (Land Title)(Appendix)
c) Price comparison if your company wanted to purchase
2.2.1.3 Factory Building
a) Type of existing building and new building company
wanted to built or purchase. (Bricks or wood – material
used)
b) Area, building status (Layout plan)
c) Development cost and cost comparison (at least 3
comparison)(Appendix)
d) Contractor or developer name and their experience.
e) Gantt chart.
f) If rental give a copy of tenancy agreement.(Appendix)
