Philippine Ventures & Destinations

Read about business opportunities and interesting travel destinations in the Philippines. Learn from the experiences of seasoned Filipino entrepreneurs and business executives. Explore places where you can listen to music, watch cultural performances, and simply have hours of fun. Check out where and what to eat while in Metro Manila, on the road or in the provinces. The following essays contain personal insights on Philippine culture and life particularly in the provinces.

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A statistics major, Leticia Subang spent the first 10 years of her professional career as an economic reporter covering for the Philippines' leading business paper. She later opted to become a free lance writer while working for her Masters Degree in Development Management. In the next ten years, she worked for a number of leading government agencies - the National Power Corporation, Public Estates Authority, Departments of Trade and Industry, Agriculture, Labor and Employment, and Energy.

Monday, August 15, 2005

Plain and simple hard work


Norberto Quisumbing Jr: No secret formula for success

By Leticia M. Subang

He learned the basics of entrepreneurship from his father.

Norberto Quisumbing Jr. was barely 16 years old when he started assisting his father run his shipping business. “He had three cargo boats that sail weekly from Cebu to Manila loaded with cement,” he recalls. In the late 1940s and early 1950s, boat trips between Cebu and Manila would take at least two days.

During those trips, Totsie, as he is called by close friends, learned to deal with people and he immediately demonstrated his knack for spotting business opportunities. “We had 30 people manning each boat to handle the 20,000 bags of cement we were bringing to Manila on my father’s inter-island ships,” he says.

During those trips, NQJr, as he is also fondly known by his employees, noticed that a lot of cement would be spilled all over the boat due to breakages. “We were given a 3% allowance for spillage resulting from breakages of the cement bags. That was equivalent to 600 bags per trip,” he says.

He asked around and learned that the spilled cement could still be used and, thus, marketable. He talked to the crew and asked them to gather the spilled cement in drums and repack them during their free time while they were on their way to Manila.

“We would be able to save about 400 bags per trip and we had three trips per week,” he says. Out of the proceeds from the sale of the repacked cement, 30% would go to NQJr while the 70% would be distributed to the crew – from the boat’s captain down to the last sailor.

“We were doing this for four to five years and everybody was happy,” he says. Aside from converting what was otherwise waste material into profits, NQJr’s scheme led to another benefit – a cleaner boat and good relations with the crew. NQJr learned how to manage people and knew what it was to earn a lot at an early age.

A dutiful son, an early marriage

His academic pursuits were periodically disrupted but he always managed to get back on track. NQJr. was a high school student in La Salle when World War II broke out. He later moved to Ateneo to finish his high school and bachelor’s degree.

He was a second year law student at the University of the Philippines when, at 19, he decided to marry 18-year old Britta Bartolome, a classical piano major. “My father could not say no, he did not have to spend anything for my wedding,” NQJr says of his early marriage. He saved enough from his cement business.

With a young family to attend to, he was forced to temporarily quit law school and then transferred to the night classes at Manuel L. Quezon University. Upon his graduation in 1953, he worked as an apprentice in the law office of his cousin and namesake, the famous Atty. Norberto J. Quisumbing.

The following year, NQJr took his wife Britta and two young children to Cebu. The move was in response to the elder Quisumbing’s request on his eldest son to help him manage the match factory in Mandaue, which the father had acquired full control of. It was here that NQJr was first exposed to manufacturing processes and in negotiating with suppliers, shippers and bankers, besides dealing with hundreds of people.

In 1960, he was accepted by the London School of Economics for post graduate studies and spent the next two years away from his family.

When he came back, he streamlined the match factory’s operations by acquiring modern match-making machinery which he saw during his travels to Germany. This enabled his father’s company, Panomatch, to capture 25% to 35% of the local match market which was then a monopoly of the Manila-based, Swedish-owned company, Philippine Match Co.

After eight years working for his father, NQJr. decided to go on his own and organized Norkis Trading Co., Inc – a corporate name coined from his own.


Biggest business venture

NQJr’s prolonged stay in Cebu became the catalyst for what would eventually become his biggest business endeavour. He also became an adopted son of Cebu.

NQJr’s family lived in the city while the match factory was in Mandaue, then a rustic rural community. Roads were bad and transportation was a problem. “The dominant mode of transportation then was the horse-drawn tartanilla,” he recalls. He was looking for an affordable alternative transportation, having decided that the bicycle was not a viable alternative.

The motorcycle caught his fancy. He learned that it was difficult to get units, even in Manila, because of limited supply in the midst of growing demand. Once he had a chance to go to Japan, he scouted for possible suppliers and learned there were ten or more motorcycle makers. He also learned that one of them, Yamaha, was being sold in the Philippines but the importer was also carrying another leading brand.

NQJr figured out that Yamaha may be interested in getting an exclusive distributor for the Philippine market and wrote the Japanese manufacturer. Yamaha initially replied to the budding entrepreneur that they were not interested but, unknown to NQJr., Yamaha was discreetly checking his background and credentials. After a while, Yamaha contacted NQJr. and offered a one-year trial period.

Growing together

The 43-year relationship between Yamaha and the Norkis Group of Companies is now one of the most enduring partnerships that the Japanese company ever had during its 50 years of corporate existence.

Norkis also became a conjugal endeavour for the young Quisumbings. Starting out with meager capital and a five-man team, NQJr and Britta divided the work between them. “I was in charge of operations and marketing while she handled finance,” NQJr recalls.

NQJr travelled all over the country, going home to Cebu only once a month, to personally set up the Norkis marketing network. Britta, who had no formal training in finance, relied on her keen eye for details and strong drive for perfection – traits she developed as a classical pianist and which enabled her to adeptly play her complicated role of tightly monitoring the fledgling company’s performance and rearing her children. And under Britta’s eagle eyes, the past 43 years has always been profitable for Norkis.

“We started with 12 units,” recalls Jose C. Yap, one of the original employees who joined Norkis in 1962. Then a 22-year-old engineer, Yap was in charge of the assembly line, supervising a mechanic, a utility man and a sales engineer. Two months later, they were doing 36 units. Norkis has assembled over a million Yamaha motorcycles since then. It is now a participant of the government’s Motor Vehicle Development Program and registered with the Board of Investments.

“Our business grew and we have made significant contributions in the economic development of the communities where we operate. We achieved all of these despite the economic downturns and without any special perks or accommodations from the government,” NQJr. says.

No secret formula

For NQJr, there is no secret formula behind Norkis success – it is pure and simple honest, hard work plus a good dose of common sense and fair dealings. “We delegate but never abdicate supervision,” he says.

The strong growth in demand for motorcycles during Norkis’ early years was brought about by NQJr’s own innovation – the tricycle. In the early 1960s, the pedicabs, which connoted slave labor, were banned in Manila. Tinkering with his motorcycles in Dagupan, NQJr. attached a Yamaha YGI 80cc to a pedicab and created an instant winner. The concept became popular and soon the volume of YGI 80cc sales soared. The tricyle became the source of livelihood for as many as 4 to 5 million Filipinos throughout the country.

But times keep on changing and the tricycle is slowly being phased out. The solo riders, which now account for as much as 80% of total sales, are fueling the industry’s growth.

In response to this market development, Norkis introduced trendier motorcycle models that owners can modify and accessorize – just like their indispensable cell phones – to suit personal tastes. Norkis recently opened Yamaha 3S Shops (Sales, Service, and Spare Parts and Accessories) in key cities where motorcycle enthusiasts can buy their units, have it serviced and dress it up in one stop.

Ever keen on the market’s changing needs and preferences, NQJr developed an alternative vehicle – the Multicabs in the 1990s. When Norkis pilot-tested the Multicab in Mandaue City, the tricyle drivers plying the area were wary they would throw stones at the new vehicles. But eventually, the operators could not resist the added benefits of the Multicabs over their old tricycles.

Depending on the model, the vehicle could accommodate up to 14 passengers and operators who shifted to Multicabs have realized they could earn twice as much as they used to on their three-wheelers. The affordable, fuel-efficient mini vans became so popular that many backyard fabricators have copied it. It is being used as ambulances in the regions, delivery trucks by many entrepreneurs, service vehicles in golf courses and roving security vehicles by local government units.

“The Multicab has become a symbol of improving standards of living particularly in the regions,” NQJr says.

Recently, Norkis launched the Legacy First, a car that is either a pick-up or mini-truck with manual or automatic transmission. Suitable for personal and business purposes, it uses a 660cc 3-cylinder engine and can carry a maximum load of 350 kilograms. Based on the Japanese Suzuki and Daihatsu design, it is a fully rebuilt vehicle using genuine Japanese spare parts into “almost new” quality and styling.

In the light of rising cost of fuel nowadays, NQJr believes that the Multicab and Legacy First have big market potentials here and in other developing countries.

Expansion and diversification

Today, Norkis’ highly diversified operations have over 5,000 employees with aggregate payroll, benefits and incentives of about P60 million a month. Another 5,000 derive their livelihood through its contractors and independent dealers, creating another income stream into the local economy of about P40 million a month.

Norkis is also one of Cebu’s biggest tax payers, contributing to the government almost P1 billion in value-added tax and import duties in 2004.

The Cebu head office oversees the operation of several factories in Mandaue and Compostela. Now composed of 34 companies, the Norkis Group is backed with a network of over 1,200 branches, dealers and service centers nationwide. Aside from its strong market presence in every province and city throughout the country, Norkis uses its nationwide network of in-house financing to the hilt to push its products.

Its core business remains to be motor vehicles – the Yamaha motorcycles and the highly affordable, fuel-efficient and pollution-free Multicabs and Legacy First. “The Norkis family shares the dream of every Filipino to have a vehicle of his own so he can be the master of his own time,” says NQJr.

The Norkis Group also exports furniture and metal crates. It has agribusiness ventures in Cebu, Bukidnon, Batangas and Masbate. Norkis is also involved in metal fabrication, engineering work and real estate development. It recently launched the Golden Aire line of air conditioners equipped with Hitachi compressors.

Highly paternalistic

Over the years, the Norkis organization evolved into an extended and expanding family. A large number of original and retired Norkisans, as Norkis employees call themselves, continue to maintain their ties with the company through their children and grandchildren who have joined the Norkis family.

One of them is Florentino Juan, one of NQJr’s trusted drivers. Mang Poling was barely 18 years old when he was hired as a janitor in Norkis-Mandaluyong in 1968. Mang Poling recalls that when he became a truck helper, he decided to attend a vocational course for driver-mechanics. He cherises the memory of being the first to drive Norkis’ brand new delivery truck, a job he held for the next 17 years.

Mang Poling eventually decided to retire in 1998 after 30 years of service. Then, the company’s chief mechanic, Mang Poling was only 47 years old. NQJr, who felt Mang Polign still had a lot of productive years ahead of him offered a Norkis dealership.

But Mang Poling was more comfortable with the trucking business, and with NQJr’s encouragement, he borrowed P300,000 from Norkis which he used to buy a delivery truck. “I have been a trucking contractor for Norkis for seven years,” Mang Poling says. His son-in-law helps him run the family business and he is happy that his daughter, Geraldine, is now the secretary of NQJr.

Many other Norkis employees have similar stories to tell. For NQJr and Britta were, and still are, always interested in what is happening in their employees’ lives. The couple still look at their employees’ regular pay, benefits and incentive packages at regular frequency. And NQJr is proud to say that Norkis’ retirement program is quite generous and gratuitous.

NQJr still remembers those painful years when Norkis had to lay off many of its workers, cutting down its workforce from 2,000 to 500. “That was in the early 1980s when the country was hit by one of the worst economic crisis,” he recalls. All of them were eventually rehired two years later.

“Our own experience in the Norkis family had shown that despite our diverse backgrounds – for we have Norkisans coming from all parts of the country and from various ethnic groups – we succeeded because we are united by a common purpose and bound by common values,” NQJr. says.

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2 Comments:

Blogger Paul Farol said...

mother jane!

This is quite a good story, galing!

8:32 AM  
Blogger Jane Subang said...

Thanks

10:48 AM  

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