3 siblings recharge PH appliance business

Three De La Salle University-educated siblings who inherited an appliance business from their parents 10 years ago now supply millions of Filipino homes with electric fans, rice cookers and other home appliances.

“It is a homegrown brand,” says Jevon Ong, referring to Hanabishi, which in Japanese means flower diamond, now represented by the brand’s logo. Jevon is the vice-president for purchasing and merchandising of Fortune Buddies Corp., the company behind Hanabishi appliances.

“Our vision is to have Hanabishi appliances in every Filipino home,” says Jevon, 34, who graduated from DLSU in Manila with a degree in Economics.  

His older brother, Jasper Ong, serves as the president of Fortune Buddies Corp. Under Jasper’s leadership with the help of his two siblings, the company saw a double-digit growth in sales annually over the past five years, as Filipino families improved their disposable income and embraced the 30-year-old Hanabishi brand.

Fortune Buddies Corp. president Jasper Ong (left) and vice president for purchasing and merchandising Jevon Ong
“In the past three to five years, the company grew 25 percent to 30 percent annually. Last year was a massive growth of almost 40 percent in terms of sales revenues.  We grew along with the nationwide expansion of SM, Robinsons and Puregold and we introduced new product lines while improving the existing lines. We also improved the design and pricing for our products,” Jasper, 37, says in an interview at a restaurant in Makati City.

Jasper, who has a degree in Manufacturing Engineering and Management at DLSU, took over the management of the Hanabishi brand in 2006, when their parents­—Jose and Conchita Ong—retired from the business.  Cherish Ong-Chua, the sister of Jasper and Jevon, serves as vice president for marketing and operations.

Although the Ong siblings grew up in San Juan, Metro Manila, they are now mostly based in Meycauyan, Bulacan, where Fortune Buddies Corp. has a massive warehouse at Sterling Industrial Park and employs 300 people, on top of a sales force of more than 1,000 around the country.  Jevon is married to lawyer Hailey Villarica, a daughter of Bulacan Rep. Linabelle Ruth Villarica and incoming Meycauayan mayor Henry Villarica, who is the president of Villarica Pawnshop.

Asked how the Ong family made its mark in the local appliance business, Jevon says it is about the brand.  “It won’t last 30 years, if not for the high quality and affordability the brand represents,”he says.

This success caught the interest of Japanese conglomerate Hitachi, which last year signed a distributorship agreement with Fortune Buddies for Hitachi television sets. Fortune Buddies, which also distributes Hanabishi TV sets for the CDE income groups, now supplies Hitatchi TV sets targeting the AB segments.

Jasper says Hanabishi started in 1986, when his father, who used to sell porcelain dinnerware door-to-door in Binondo, travelled abroad and realized the potential of venturing into the appliance industry. 

Jose Ong, the patriarch of the family, visited Thailand and Taiwan, which were strong in appliance manufacturing at that time.  He thought that the Philippines, being a tropical country, would have a rising demand for electric fan, and more Filipino families would buy the product if it was more affordable. 

Jose, together with a business partner, searched for manufacturers who could offer practical and reasonably priced products.  Then, they sold the products under the Hanabishi brand.  Two years later, they established a manufacturing plant in Malabon with 10 employees and competed with other homegrown brands such as Asahi, 3D and Standard.

“There were only few major players.  The competition at that time was on price.  Other foreign and local brands were very expensive.  My father wanted to offer more affordable, and at the same time quality products. That’s how Hanabishi came to be known,” Jevon says.

The local market received the Hanabishi brand well.  Encouraged by the success of Hanabishi electric fan, Jose Ong and his partner introduced more products such as rice cooker, flat iron, gas stove and other small appliances.

Before the Ong siblings took over in 2006, Hanabishi had a product portfolio of 50 stock keeping units.  Jasper says under Fortune Buddies Corp., Hanabishi gradually expanded by introducing more products and models.  “From less than 100 SKUs in 2006, we now have 400 SKUs today,” says Jasper.

TV host Vic Sotto (second from left) seals a contract as the endorser of Hanabishi appliances. With him are the Ong siblings.
From electric fans, Hanabishi now offers home appliances such as rice cooker, gas stove, oven toaster, flat iron, juicer, blender, exhaust fan, duct fan, turbo broiler, electric airpot, air-conditioning units, refrigerators, chest chiller, deep fryer, water dispenser, washing machine, microwave oven, electric oven and LED TV.

Jasper says an appliance could have as many as 10 or more SKUs, depending on the model, size, design, color or features of the product.  “Filipino consumers are now more choosy in terms of 

design and color.  With many choices, consumers are now more empowered,” he says.

Jasper says the partnership with Hitachi Electronics Asia for the distribution of Hitachi TV sets is another milestone for the company, as it is now able to serve the AB income group.  He says the plan is to look for more distributorship agreements with other foreign brands, while strengthening the Hanabishi brand.

“Last month, we also brought in digital electric oven, the first in the Philippines.  We are the first to introduce that.  We also have induction cookers, which are now the preferred cooking appliance in condominiums,” Jevon says.

Jasper says despite the entry of new players amid the onset of the Asean Integration, Hanabishi will continue to be known for its quality and affordable products.  “We are in the mid-range in terms of price.  We cater to practical customers and we have a strong 30-year-old brand.  We are not pricey, yet we are not very cheap.  We don’t compromise on quality.  We need to protect the brand,” Jevon says.

Jasper says new players try to sell at a lower price than Hanabishi, and even below the production cost.  “But that could be substandard and could be risky.  To assure customers of Hanabishi quality, we offer five-year warranty on motors of electric fan and five-year warranty on compressors of refrigerators and air-conditioners,” Jasper says.

Jasper says along with traditional products such as electric fan and rice cookers, television is a fast-growing item.  “We started distributing TV two years ago. Slowly, in the past two years, we are growing in that segment,” he says.

Jevon says Hanabishi is now the country’s leading brand in the small appliances segment.  “We are hoping to grow at least 30 percent this year.  First-quarter results are very good. Retail companies such as Puregold, Robinsons, SM, Shopwise, CitiMall are expanding.  We tag along with their expansion.

We are the preferred suppliers of these retail chains.  Wherever they are opening new stores, we are also there, given our expanded range of appliances,”Jevon says.

Jevon says Hanabishi is present in 3,000 outlets nationwide, offering appliances for household kitchen and living room.

Jevon says growth would have been higher in the past two years, if not for the port congestion and heavy road traffic.  “Infrastructure is one big concern among businessmen, because the lack of infrastructure leads to inefficient delivery and logistics,” he says.

Hanabishi products are manufactured in China, which is known for its high volume of production.  “We source it where it is of good quality and affordable.  We are looking for other countries which could produce the same, but so far China remains the most viable source.  Volume production in China makes it affordable,” Jasper says.

Jevon says Fortune Buddies has a team in China that is in charge of design and quality control. “They ensure that the quality of the products and minimum standards are followed,” he says.  The Fortune Buddies team dictates the color, design, pattern and shape of the Hanabishi appliances, according to Jevon.

Jasper says with the success of Hanabishi, Fortune Buddies is organizing a thanksgiving party in October this year to mark the 30th year of the brand. “We would like to recognize the people, customers, employees, sales force, business partners, dealers, consultants, marketing and advertising strategists who are behind the success of Hanabishi,” he says.

Jasper says the company has also teamed up with charitable organizations as a part of its corporate social responsibility.

Hanabishi has supported civic organizations and foundations such as the Bantay Bata 163 and GMA Kapuso Foundation and responded to the needs of calamity-stricken areas. It donated home appliances to 200 families in Iligan City affected by typhoon Sendong in 2011 and 600 families displaced by typhoon Yolanda in Leyte in 2013.  A street in Palo, Leyte was named after Hanabishi to recognize its contribution.

Jevon says as a part of its marketing, Hanabishi teamed up with Eat Bulaga for its KalyeSerye series and tapped TV host Vic Sotto as endorser and face behind the “Kapartner ng Praktikal na Nanay at Bossing” brand identity.

“It has worked quite well,” says Jevon, as he credited the AlDub series, referring to the onscreen partnership of Alden Richards and Yaya Dub, in Eat Bulaga for helping boost sales of Hanabishi appliances last year.

Jasper says based on Securities and Exchange Commission data, Hanabishi has emerged as the leading homegrown appliance brand, in terms of sales and revenues.

He says the outlook remains positive for the appliance sector.  “We are constantly on the lookout for new products. We attend various trade fairs abroad, where we search for innovative, new technologies and products,” says Jasper.

“We expect growth to be sustained in the coming years.  Every year, sales have been growing.  We work closely with big retailers and all of them have very good outlook and plan to open new stores in the provinces.  The Philippine population is also growing, and so is their need for affordable, practical and quality appliances,” says Jasper.

Jasper credits the success of Hanabishi to hard work and constant search for affordable, quality products.  “This is why we have loyal customers.  They come back.  When we introduce more categories and appliances, they trust the Hanabishi brand,” he says.

Topics: Jevon Ong , Jasper Ong , Cherish Ong-Chua , Hanabishi , Fortune Buddies Corp. ,
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