"He had no equal."
As the year comes to a close, one person I will miss much from the business scene is the late Henry Sy Sr.. He died on the morning of Jan. 19, 2019. He was 94.
With visioning and unrelenting hard work, Tatang Henry grew his 10 centavos in 1936 at age 12, into a $20-billion wealth today, making him the richest Filipino, the ninth richest in Asia and the 52nd richest in the world. In the Philippines, he had no equal.
Henry began doing business at 12 landing in Manila by boat in 1936 from Xiamen, with only 10 centavos in his pocket, but in search of his father and a better life. He spoke no English and no Tagalog.
Sy’s holding company, SM Investments Corp. (SMIC) is the Philippines’ largest conglomerate in market capitalization of $24.5 billion; the next biggest conglomerate, JG Summit, has a market cap of just $10.8 billion. His BDO Unibank has a market cap of $59.6 billion, the most valuable local bank; Metrobank, with $45 billion, is a distant second.
The business footprint of Henry’s SM Investments Corp. (SMIC) is formidable: 2,693 retail outlets, 74 malls, and 2,014 bank branches.
SMIC is a leading Philippine company that is invested in market leading businesses in retail, banking and property. It also invests in ventures that can capture high growth opportunities in the emerging Philippine economy
In the first nine months of 2019, SMIC had revenues of P350.7 billion and profits of P33 billion.
In 1936, Henry spent half of his 10 centavos to buy a loaf of bread in the boat. But he fell ill because it had butter. Fortunately, he befriended another boy who found P20 lying on the boat’s deck. That sustained them during the perilous journey.
When young Henry first saw his father, he cried. “There has to be a better life than this,” Henry told me in one interview eight years ago. His father’s store in Calle Echague was no larger than two square meters. It was multi-functional—a store by day, a bed by night, with the same table where goods were displayed serving as bed by nightfall. Every morning his father bought goods in Divisoria and carried them barefoot to Echague. It was backbreaking unrelenting work.
From his father, Henry learned one thing—the importance of discipline, hard work, and good credit.
Henry was born in Xiamen, China, on Oct. 25, 1924, as Sy Chi Sieng (in Chinese “to attain ultimate success”).
Henry began doing business by buying and selling. He would buy cigarettes by the cartons from American GIs and sell them by the pack, making a peso per pack. He also went into selling scrap metal and other odds and ends.
Later, with rented space from Don Vicente Rufino on Calle Carriedo, Henry built his first store, selling anything he could. It was also his house by night. US shoe importers offered to sell him shoes by the job lot. The business prospered.
Henry introduced innovations in retailing like fixed pricing, after a Filipino GI walked into one of his stores and bought a pair of shoes without haggling. Henry felt guilty the GI was overcharged.
Other innovations—sales girls dressed like stewardesses and very important, air-conditioning “so shoppers would feel like they are in America.”
By 1959, Henry, after nine years of marriage to Felicidad, a teenage crush, had six children—Teresita (1950), Elizabeth (1952), Henry Jr. (1953), Hans (1955), Herbert (1956), and Harley (1959). They are the new management team today.
“From the very start, at the age of 10,” Henry recounted, “I knew I had the drive and determination to make something of myself,” Henry recalled of his journey in 1936 to Manila.
“While I am not big with words,” Henry said, “I am big and bold with my dreams and vision.”
For Henry, “there is no such thing as overnight success or easy money.”
Before reaching 30, Henry had made his first million. He said to himself: “Only the first million is difficult. After that, the rest is easy. There are countless ways to make more money. Only your willingness to work, your imagination, and time can limit the ways.”
In 1955, Henry went to New York to secure a steady supply of shoes. Also, he was already planning for a chain of shoe stores.
Henry and his family moved to North Forbes Park in 1962 and a year later, Shoemart Makati opened its doors to the public. “I saw the development of Makati from the time when there was only one building on Ayala Avenue. I saw the potential of the place and made my investments,” he said.
Henry opened Shoemart Cubao in 1967 and the Manila Royal Hotel in Echague in 1969.
By the 1960s, Henry was a made man. But he pursued grander plans. From the late 1960s to the 1970s.
Launched in 1972, Shoemart Manila on Carlos Palanca Sr. Street (formerly Calle Echague) was transformed into the first of Henry’s department stores. Its immediate success inspired Henry to embarked on an even larger expansion in Makati in 1975. All of Henry’s stores would be rechristened “SM Department Store,” or simply, “SM.”
Of this triumph and others like it, Henry simply said, “Crises also produce opportunities.”
In 1976, he bought Acme Savings Bank, with two branches, for P5 million. It is now Banco de Oro, the largest bank. SM Makati was booming,
The late 70s and early 80s were years of economic stagnation and political instability in the Philippines. They were years of feverish expansion for Henry.
In 1985, Henry constructed a huge multi-level building to provide retail space for over 100 tenants, with everything under one roof. This was SM City North EDSA. He spent P200 million on it.
By 1990, Henry retired as president but remained chairman. He bought the Ortigas property where Megamall is now, but not after losing a bigger corner lot in a toss coin with John Gokongwei Jr.
Megamall opened on June 28, 1991. The largest mall in Asia at the time, it had two buildings connected by an enclosed bridge.
Henry attributed Megamall’s success to its retail mix. “What they [competitors] have is shopping, dining, recreation, amusement. We offer more—cinemas, ice-skating, service clusters, an art gallery, showrooms for specific products like home furnishing, appliances, and computers.”
In June 1994, the SM Group went public and raised P4.7 billion, which was used to build over the next five years SM malls in Cebu, Las Piñas, Bacoor, Fairview and Iloilo.
Henry was named Management Man of the Year for 1999 by the Makati Business Club. The award was presented by then Vice President Gloria Arroyo on Jan. 24, 2000.
Mall of Asia opened on May 21, 2006. On its first day of operation, more than one million people came to see the city’s newest mall. Since then, it has welcomed a billion visitors.