Pensonic defies the odds to become a success

Founder and executive chairman attributes success to strong customer-care strategy

GEORGE TOWN: When Pensonic Holdings Bhd executive chairman Datuk Seri Chew Weng Khak started the Pensonic brand name in 1982, only a few believed that the local brand name could take off successfully as it was clashing directly with many foreign brand names of electrical and electronic home appliances.

However, the group managed to prove the skeptics wrong as it has been selected to spearhead the establishment of a home appliance manufacturing hub and international distribution network under the country's Economic Transformation Programme (ETP).

Chew in an interview with StarBiz had attributed the success of Pensonic brand name to the group's customer-care business strategy.
Chew: ‘We will never forget the roots of Pensonic’s success.’

He said: “The only way to compete against the foreign brands is to formulate a strong customer-care strategy that can win the customer's confidence for your product.

“Without a strong customer-care policy, you will not be able to prove on the reliability of your product, regardless of the amount of capital you might pump in,” Chew added.

However, having sufficient capital was important as it could ensure the business could kick-start without any obstacles, he added.

The idea for the Pensonic brand name started back in the early 1980's when many Japanese and European brand names of home electrical and electronic appliances were being taken back by their principal companies.

This was a big blow to Chew's company, Keat Radio and Electrical Co, which was then involved in the distribution of foreign home electrical and electronic appliances.

The news was a major disappointment to Chew, as he had been grooming the company since 1965, from a small retailer cum radio workshop in Balik Pulau.

In 1974, Chew had established the first branch of Keat Radio and Electrical Co along Perak Road, and in two years, he transformed the company into a respected distributor of Japanese made home appliances in the northern region.
Respected brand: Pensonic home appliances on display at the company’s headquarters in Penang

“The turn of event makes it is no longer possible for us to be in the home electrical and electronic appliances business, unless we start selling our own brand name,” he added.

While it was challenging for a local brand to gohead on with the other established Japanese and European brand names he said: “The advantage is that there will be no other local brand name products competing with us.”

Hence, the Pensonic brand name was created via a combination of “Pen” and “Sonic” to mean the “Sound of Penang”.

The company also commissioned an original equipment manufacturer (OEM) of South Korea, then a small company but is now an international name, to produce the audio products for Pensonic.

With an existing extensive distribution network in place, Chew said the companywas focusing on the marketing of the Pensonic brand name using vans to service the rural areas of the northern region, where there was few competition from foreign brand names.

“We started off with audio products, and gradually introduced new range of home appliances such as rice and gas cookers and electric kettles,” he added.

Initially, Chew said Pensonic was targeting the wholesale sector, then eventually it started to appointits own dealers.

In the early days, the group also had difficulties in sourcing funding from the banks.

“This was indeed a challenge. Financial institutions then were cautious to new businesses. Without financial backing, it was difficult to source for raw materials and to fund business operations.

“We did not give up, relying on our earlier investments into commercial properties to refinance Pensonic's business.

“Finally, within a few years we managed to get a contact who is willing to help issue letters of credit to our suppliers to procure raw materials.

“We also managed to find a supplier in Hong Kong supplying to us on credit basis,” he said.

In 1988, the company started manufacturing and distributing its own products, focusing on home appliances, under the Pensonic brand name.

Later in 1995, Pensonic Holdings was listed on the Second Board of Bursa Malaysia. This subsequently saw the company venturing into the manufacturing our own design (ODM) for several international brands.

To date, Pensonic has 10 branches withover 900 dealers nationwide.

Its products are exported to 30 countries in Asean, East Asia, West Asia and the Middle East.

Chew said: “The group will never forget the roots of Pensonic's success, which lies in its customers' support.”

Therefore, in 2003, Pensonic to better service its customers, had engaged international brand consultants to develop a master plan to rebrand Pensonic's image, focusing on strengthening customer care strategy.

“It took us five years to plan and finally we launched the new image and customer-care approach in 2008,” he added.

Pensonic had signed a significant ODM contract last year with a global electrical home appliance brand for the manufacturing of small appliances for its subsidiaries in 100 countries worldwide.