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Helping fish farmers to sleep well at night

Date of publication : 3/2/2009
Source : The Business Times

YEO Keng Joon, who heads Bharat Luxindo, is cautiously upbeat about business prospects despite the weakening global economic climate. This is because Bharat Luxindo, which supplies prawn and fish feeds to farmers in Andra Pradesh, India, continues to see strong end-demand in markets such as West Bengal.

'In addition we are helping the farms to increase their productivity by using our pelleted feed which will enable them to stock the fish in the ponds at a higher stocking density than what they have been traditionally used to.'

The entrepreneur also has interests in other companies that invest in biotechnology research and aquaculture feed operations in Indonesia.

Last year, Bharat Luxindo posted a revenue of US$5.2 million - up from US$3.8 million in the previous year.

Although Mr Yeo started the aquaculture business with his partners only in 1997, his associations with the industry began much earlier.

Prior to founding the company, he was the aquaculture director with Gold Coin Group, one of the leading animal feeds and nutrition companies in Asia, for more than 10 years. It was also for this reason that the partners decided to focus on the aquaculture feed business.

When asked about the key factors behind the company's growth, Mr Yeo pointed to the multi-million-dollar investments made in Indonesia and India, which boast large domestic markets. He adds: 'The market is so huge, even 20 factories of the current size in India would not be enough'.

Not to be neglected are ingredients such as core competence and quality at affordable prices.

Mr Yeo explains: 'You must have a good team of people, know what it takes to run the business, and so you need to build up a credible team of people to ensure your core competencies.'

Mr Yeo brings up an example: 'If I encounter some trouble in the factory, I can call on somebody who is an ex-production manager and put him in the plant for a short stint to stabilise everything.'

Another important factor in the perishable goods industry is the quality of the products. 'We were able to entice our customers from our previous employer based on the working relationships and quality products.

'And when you are doing business in livestock, farmers want to sleep well at night, so you have to give them the assurance that you can maintain the quality. The fact that we have already done it for a good 10 years has helped as well.'

However, it was not all smooth sailing since the firm's inception. For example, an earlier joint venture with an Indian partner failed three years later when the counterparts pulled the plug, leaving the new business with losses of more than US$1 million.

Mr Yeo and his group of friends kept faith in their investment and decided to pump more capital into a new wholly-owned operating company - Bharat Luxindo Agrifeeds Pvt Ltd - and finally turned its business around.

He also points out that this industry is a fairly competitive one and so the importance of core competence cannot be over-emphasised.

During the interview, Mr Yeo also touches on corporate social responsibility (CSR) activities as he believes in giving back to society.

For example, he personally provides school fees for the children of the company's workers in India and Indonesia, as well as mentorship and guidance. The company even holds festival celebrations for its workers, highlighting the importance it accords to CSR.

Looking ahead, Bharat Luxindo plans to expand into the prawn hatcheries industry, as well as consolidate its 'footprint' in the market.

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