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Freshening Industries:
Revenue takes off with external wings

Freshening Industries: Revenue takes off with external wings

WET-WIPE maker Freshening Industries, which started operations in 1994, expanded quickly and, by 2000, felt stifled by the limited opportunities in the local market.

That year, the company realised that it could compete in the overseas market, but only if it could produce good quality wipes for the mass market at an affordable price.

With that idea, Freshening began its overseas foray, buying high quality products and turning them into better quality wet wipes for the global market.

Mr Jonathan Phoon, 42, the company's executive director, says: "Despite some drawbacks in the labour and land costs in Singapore, we do have our unique proposition because Singapore has a brand image associated with cleanliness and hygiene.

"This added value to our products and helped us to enter the foreign markets."

The company, which employs 90 people locally and a further 134 in four factories abroad, exports to 35 countries.

Mr Phoon felt the company had to do something to move itself forward.

Freshening had always been a forward-looking company with clear internationalisation plans, he says.

He was not content with having one or two distributors in a single country.

He says trading in small numbers is not developing and growing a market and, hence, it was not what Freshening had in mind.

So, with the objective of developing its distributors in each country, Freshening Industries approached International Enterprise (IE) Singapore for help in 2010.

Together, they undertook a branding project to better align Freshening brands and to build clear brand identity.

In the exercise, IE's consultant found that the company's branding was confusing.

Freshening was advised to categorise its products into three different labels to attract Singapore and international customers.

The consultant also provided market information and identified infant care as a key market for the company to enter.

Freshening spent a year implementing the new labels that came out of the branding exercise.

It differentiated its wipes into various brands. The first was Smart Towel, positioned as a premium restaurant wet towel.

The second brand was Zappy, which was likened to, and associated with, a personal bodyguard.

It was a product that "took care of you", says Mr Phoon.

This brand includes baby wipes, mosquito-repellent wipes and sports wipes.

The third brand was HospiCare. It comprised alcohol and body wipes which are used in all major hospitals in Singapore.

The company also makes wipes targeted at general consumers under the FrG label. This line of products includes bird-dropping wipes and stain-remover wipes.

Mr Phoon says Freshening is now set to launch wipes for facial care and pet care under the Linz and Woosh labels.

The branding exercise was a success, says Mr Phoon. Distributors and consumers have a better idea of the products.

He says: "We came to understand the importance of brand differentiation and that helped us to enter new markets with new products more competitively."

Freshening, he notes, also has hand sanitisers now.

In 2010, as part of its internationalisation strategy, it identified China as its next focus market.

Last year, it embarked on a feasibility study on the China market under IE's Global Company Partnership (GCP) scheme.

The feasibility study has given the company a better understanding of the business environment, competitors and the right market entry strategy.

With that, the company is all set to make its presence felt with the HospiCare and Zappy labels in the Chinese market.

Under the GCP scheme, Freshening and IE have set up a marketing office in China and are recruiting more distributors.

"IE paved the way with market intelligence, entry tariff and market entry requirements and that shortened the tedious process a fair bit."

He adds that IE helped to introduce suitable in-market partners and facilitated business-development trips to China which yielded some promising outcomes.

He says: "IE had the right connections and we were assured we had trustworthy partners to work with."

Another perk that came with working with the right partner was the access to real data.

Mr Phoon says Freshening gained insights into the new market because the partner shared valuable market information.

The company was able to assess the market well and take calculated risks.

The GCP scheme also subsidises the cost of running the main office in China.

Mr Phoon says: "With lower costs, we are able to stretch our budget and sustain ourselves in the market for a longer period, as market penetration takes time."

After the collaboration with IE and the branding exercise, Freshening registered a 32 per cent increase in revenue in the last financial year, after a three-year implementation period.

Mr Phoon adds that Freshening never had such growth before and credits the plans and guidance from IE for the success.

He notes that by developing external wings, Freshening has been able to save cost by achieving economies of scale, improving its automation and streamlining its processes.

Freshening is now looking into using robotic arms in its production line to boost efficiency.

The journey has also been an eye-opener. Mr Phoon says: "We now know what makes an ideal partner abroad. We have also gained an understanding of the types of products suitable for the different countries."

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