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Pin Corporation Interview – Sharing insights on frozen food products distribution in Singapore

Pin Corporation Pte Ltd

Mr Liew YF, Executive Director

Introduction

  • Started in 1996 as a family business, Pin Corporation’s principal business activity is in the distribution of frozen food products in Singapore.
  • With a primary focus on frozen meat products, their source countries are usually Brazil (70%), Germany, Holland, Denmark, Spain and US.
  • Pin Corporation’s business covers the entire logistical chain of procuring the frozen meat products, warehousing and storage of these products, and the subsequent sale and distribution to customers.
Cold-room business

Pin Corporation’s wholly-owned subsidiary, Mandai Link Logistics, owns a cold-room with a total storage capacity of more than 25,000MT and a height of about 30m.

This facility was built in 2006 after obtaining land from JTC Corporation.

The cold-room is equipped with an advanced Automated Storage and Retrieval System (ASRS) specially built by an European specialist (LTW Intralogistics).

They also have an in-house customer inventory system – where customers can just send in an order and the system will automatically retrieve the required amount of goods for collection at the specified time. Customers can then come and collect their goods, or if they don’t have the necessary transport, Mandai Link Logistics can provide it.

It is an automated and paperless system which they have been improving over the past few years.

The cold-room is used for the company’s own internal storage purpose, with extra space rented out to customers.

After diversifying into the cold-room business, Pin Corporation made a conscious decision to import only high-margin products. This reduced the amount of products they hold, so that they can rent out the extra storage space.

As a result of their spacious and highly-advanced cold-room, Pin Corporation has the capability to stockpile its products.

COVID-19

25-27% of Singapore hen eggs come from local farms, about 70% from Malaysia and the rest from other countries.

In order to not be overly-reliant on just Malaysia, the Singapore Food Agency (SFA) encouraged importers to have a third source for hen eggs (Japan, Korea, Australia, Europe, etc.)

These imported hen eggs have to be under chilled conditions and as Mandai Link Logistics has the biggest chill room in Singapore, they now store the largest supply of chilled hen eggs in Singapore.

Consequently, Singapore’s hen egg supply was still stable when COVID-19 hit.

Labor

Pin Corporation employs about 90 staff across the entire group. They recently increase their local workforce due to government-imposed quotas on foreign staff.

Local workers are generally not interested in this business as they are often required to work under very challenging working condition in the coldroom. Therefore, they have to hire extra staff to ensure its smooth operations.

Mandai Link Logistics has an in-house maintenance team for their cold-room, none of whom are locals. They all hold S-Passes, and it is getting more challenging to renew them..

How did you get into the business?

During his schooling days, Liew obtained a scholarship from the Economic Development Board (EDB) to study mechanical engineering in Germany.

This was part of a government initiative to attract foreign companies to invest in Singapore in the early 70s by ensuring that Singapore has local engineers with the necessary skills to work in these companies after they are set up.

After graduation, Liew worked for EDB, which sent him to work for SKF Manufacturing.

Liew left after five years to take up a sales job with East Machinery. He took up this job for the opportunity to travel to China

Two years later, Liew got posted to Hong Kong to be their branch general manager from 1987 to 1989.

Later in 1989, he was headhunted to join Fagor Automation after his contract ended. In the new company as a Managing Director in charge of the overseas Asia Pacific market. In between he spent 2 years in Taiwan to setup the branch office there and subsequently also tasked to develop offices in Shanghai, Beijing and Guangzhou.

The start of Pin Corporation…

In 1995, upon the request of his family, Liew came back to Singapore to help out in the family business.

In their first year, Pin Corporation achieved a turnover of SGD 9.6 million, which was very good for a start-up operation.

The company experienced a number of crises (Malaysia Nipah virus, swine flu, bird flu, SARS etc.) – all of which actually benefited them as people turned to frozen meats when those viruses hit.

In 2003-2004, they achieved net profits of nearly SGD 3 million, turnover of more than SGD 60 million, as well as profit margins of about 15%.

At one point, Pin Corporation was preparing for an IPO. However the market was very bad then and they decided to stop the process.

The company then turned to UOB – who helped to finance them in building the cold room.

Their customers

Liew discussed the need for Singapore to diversify its food sources.

He added that Pin Corporation only does B2B business (dealers, food manufacturers or meat processors and secondary importers) who serve restaurants and other food outlets.

Liew described how some of their customers started out as small companies, and eventually expanded to become their competitors. He pointed out this is possible as their market is still growing.

Plan for the next five years

Liew shared that his children are not that keen in the business.

Mandai Link Logistics is also considering expanding its cold room facilities foreseeing the increasing need for more storage facilities in Singapore as the government strives to maintain a healthy stockpile of essential items.

He is open to acquiring other companies, or for Pin Corporation to be acquired if a good price is offered.

Business links with Japan

Liew has been visiting Japan quite regularly since 2012, especially to Kagoshima as they had planned to import kurobuta pork to Singapore.

He described how he had to help the exporter apply to the then Agri-Food and Veterinary Authority of Singapore (Now known as Singapore Food Agency) for accreditation due to the language barrier.

As Japanese products are more expensive and not suitable for their current customers, the company wanted to set up a special division just to import Kagoshima products.

Unfortunately, the venture didn’t succeed and they currently don’t import any Japanese food products.

Nevertheless, the company did collaborate with a Kagoshima company which produces a special animal feed additive. Pin Corporation was an agent for the product and they tried to promote it in East Malaysia. However, the response was not very good there.

Liew revealed that they had a good relationship with the Bank of Kagoshima. He understands that the Bank plays a vital role in promoting Kagoshima products overseas.

Liew also described how he was very impressed by the Japanese company Muratec back in 2005 when Pin Corporation was looking for a specialist to install their ASRS system for their cold room.

Message for Japanese companies

Liew shared that he visits Japan every year as he loves the culture and the respectful way they treat each other.

He is also very impressed by how the Japanese are able to make significant enhancements to existing products. For example, black pigs can be found in other countries, but only the Japanese have been able to breed the premium kurobuta pork.

Meanwhile, he noted that Japanese companies are typically more cautious and conservative in the way they do business.

One piece of advice Liew can offer is that knowledge of the English language is important when doing business overseas.