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PROFILE
Profile of the month: Alfred Chua
Text by Marc Almagro
Photography by Chino Sardea
Styling by CK Koo
Grooming by Benedict Choo using NARS
11 Feb 2020
Photography by Chino Sardea
Styling by CK Koo
Grooming by Benedict Choo using NARS
11 Feb 2020
The recent acquisition of The Wok People by an international conglomerate puts it firmly on track for sustained growth and further expansion into new markets.
Mr. Alfred Chua showed up at Bodacious, a bar and bistro that he launched with a childhood friend, at half past two in the afternoon. The lunch crowd had thinned by then and the staff were clearing tables and putting the house in order.
My team, meanwhile, had sequestered a corner inside the establishment, and had begun setting up the photo equipment and hanging out the apparels they had assembled for the pictorial.
I had not until then met Mr. Chua, 44, managing director of The Wok People Pte Ltd, a business that he founded and runs with his sister Ms. June Chua, who is the CEO. He thrust his hand out as he strode in our direction, smiling broadly as if he had spotted a bunch of people that he knew but hadn’t seen in a while.
He is tall and has an easy-going air about him, the type of a man that is often described as “a people person” – warm, open, forthright. He was ready to take instructions, he told us casually, after asking if we had had anything to eat or drink.
Bodacious is a standalone, branded establishment in Biopolis, a wooded precinct in the western part of Singapore where international biomedical organizations are massed.
Although not a part of The Wok People portfolio, Bodacious is an interesting clue to Mr. Chua’s personality. It is cheery and convivial, flexible in its offerings of bistro food and bar concoctions, and very appropriately designed.
“We built this as a place for entertaining friends,” he said. It comprises outdoor and indoor dining areas, a well-stocked bar, and even an entertainment section where bands can play.
This is not the first of this type of establishment that Mr. Chua has set up. He has run one in a shophouse in the West Coast but chose to lease it out after a few years’ run.
The Wok People operates in another sphere – Business & Industries (B&I) – where it manages employees’ canteens for companies. It is a dynamic and lucrative sub-sector of the food industry, but also perhaps the most overlooked.
The Wok People runs the facilities provided by the clients. Mr. Chua’s teams, currently an aggregate of 600 full-time staff, go in to cook the food and serve it to the employees.
As an institutional caterer, The Wok People is up there in terms of expertise, capacity, and innovation. It runs 65 canteens that feed employees of large hospitality and retail establishments, semiconductor and manufacturing companies, as well as those dealing in pharmaceutical, petrochemical and shipbuilding.
It is not difficult to imagine the range of requirements that these companies have in terms of service delivery, hygiene and nutrition standards, and engagement provision for their employees – factors on which the profitability and longevity of any institutional catering business pivots.
The business earns revenues from the individual diners who pay them directly for the meals, as well as from clients who engage them to provide free food to their employees. Revenues from the individual sites differ relative to their sizes – The Wok People runs sites with anywhere from 300 to 3,000 employees – but average from S$30,000 to S$200,000 per month.
- A NEW CHAPTER
- OTHER AVENUES
- THE RIGHT ONE
- BETTER THAN USUAL
- INSPIRED BY SUCCESS
Before 2019 ended, The Wok People completed an M&A exercise that transfered its ownership to the Green House Co. of Japan, Ltd. Founded in Kawasaki in 1947, Green House started out as a dorm cafeteria operator at Keio University.
“They do what I’m doing now, institutional catering, but they also service the healthcare industry, such as homes, nurseries, and tertiary and international schools,” Mr. Chua said. Green House also operates a chain of restaurants and manages its own hotels in Japan, along with businesses in South Korea, China, and Vietnam.
Apart from the ownership, no major changes are immediately expected from the company, Mr. Chua revealed. As working company directors, he and his sister are expected to continue performing their jobs.
However, he anticipates a change in market coverage. Among the objectives of the acquisition is building a stronger presence in Asia, and using Singapore as the regional headquarter for that expansion.
“Singapore has a very good reputation for corporate governance,” Mr. Chua underscored, “and Green House regards us a promising company.”
In most M&As, the first year is dedicated to the integration of cultures, systems and processes of the companies. “I foresee an exchange of synergies and skills,” Mr. Chua surmised.
“From the second or third year onwards, it will probably be regional expansion because for the past 10 years we had been a local company. All our businesses operate here in Singapore, which is small, and where manpower is a challenge.”
Mr. Chua pointed that that his competitors are among the top five or ten operators worldwide.
“Although we’re one of the main players here, we're also the smallest and the only SME. The rest is big international groups. Hopefully, this M&A will give us some muscle.”
M&As are complex situations. Business owners are emotionally invested in the companies they have built, and rightly so; in fact, that emotional connection powers their passion for growing the business.
Yet some who have ceded ownership of their business to another entity manage to remain committed to its success. They continue nurturing it although it is no longer theirs.
“It depends on how you look at the situation. Some would like to keep the business and pass it on to the next generation,” Mr. Chua averred.
“It also depends on the industry that you're in. For us, [institutional catering] is a labor-intensive business and, unfortunately, Singapore has serious labor issues. We thought that if we could have a bigger voice, if someone came in to bring the company to the next level, everybody will benefit.
“It's not about whether I’m willing to let go. If I don't let go and I continue to run the business as it is, it might start going downhill.
“So, we made the assessments and decided that it's going to be very challenging in Singapore. Any business owner will tell you about the sadness they felt selling their business, but if you consider the wider perspective, you're actually allowing the business to grow. You’re being unselfish by letting it go.”
- A NEW CHAPTER
- OTHER AVENUES
- THE RIGHT ONE
- BETTER THAN USUAL
- INSPIRED BY SUCCESS
Other Avenues
Given its revenue, a public listing was a strong possibility for The Wok People. Although it might dilute his shares, a listing could still leave Mr. Chua in control of the business.
“Listing a company is a different ballgame,” he reasoned, “and not always the way to go.” Among the important gains from listing is earning credentials, which is useful in capital expansion, he said.
“But our kind of business is a cash business, and we have a very positive cash flow. What will be the purpose of listing where you'll have shareholders coming in, wanting to run it their way, and having a say in the business?”
Every cafeteria is different, Mr. Chua assured me. “The expectations have gone up over the years; our customers are younger and more exposed.
Gone are the days of typical canteens serving ‘economical rice’ and some dishes. They expect a lot of other things now.
“Listing will not necessarily give us the added value or synergies we need. It will just be money and more people who would want to get involved with the business.
“It will tie our hands. On the other hand, an M&A with the right partner will bring in a lot of synergies.”
The system in place at Green House is very strong, he said, due to their processes and, particularly, their technology know-how.
“I can bring a chef from Japan to my canteen to whip up an authentic Japanese cuisine. On the other hand, my chef can go to a business unit in Japan and cook laksa or chicken rice. That will be a better career opportunity for him.”
Mr. Chua’s objective is to grow the business and give more opportunities to their employees who have helped build the business over the past 10 years. “Although a listing will make us look and feel good by allowing us to borrow more money and gain more prominence, it's not what we need.”
- A NEW CHAPTER
- OTHER AVENUES
- THE RIGHT ONE
- BETTER THAN USUAL
- INSPIRED BY SUCCESS
The Right One
Green House is one in a line of “suitors” that have shown keen interest in acquiring The Wok People. And while some companies hide its receptiveness towards an M&A – mostly for fear of appearing to be in distress – The Wok People had been quite upfront about it.
“Even in the past two years, we’ve been saying that we were ready to find partners with whom we have synergies, because we wanted to bring the business to another level. We've seen more than five big international groups that have spoken to us, and when the stars aligned, we found ‘The One’,” he laughed. The M&A took about a year to complete, a relatively short time for such an exercise.
Mr. Chua is now looking forward to opportunities that an exposure to international markets will bring. “The Wok People has completed a chapter of 10 years; it's now opening up a new chapter. Most of my key appointments and department heads embrace it and look forward to it.”
The Wok People is known in the market as being people-oriented, explained Mr. Chua. “Otherwise, we wouldn't have been able to keep our staff for the past 10 years while we competed with big international caterers.
“We're people-focused, some may say very traditional, because we know we can’t run the business without them. This practice of treating our staff well has been with us since the start.”
Naturally, a shared commitment towards staff was an important requirement in their search for a partner. “We looked at the history of Green House and realized that we have the same vision. We immediately saw chemistry between us,” recalled Mr. Chua.
The real deal-clincher, however, came as a surprise even to Mr. Chua. “Before we could even lay down our term to keep all our employees, (Green House) said that we could maintain all employee benefits as well.”
The Wok People, for example, organizes annual staff trips to different places around the world; 40 of its staff had just recently returned from one to Dubai.
- A NEW CHAPTER
- OTHER AVENUES
- THE RIGHT ONE
- BETTER THAN USUAL
- INSPIRED BY SUCCESS
Better Than Usual
Mr. Chua’s current priority is gaining the confidence of his clients and staff after the merger.
“That's crucial in the next six months. My clients have to be comfortable that there'll not be major changes in the business model.
“Our business is all contractual – we place a tender to run each canteen. I have to assure the people I work with that there will not be disruptions. They should also see the value of a bigger voice and a better system in getting things done, particularly when it concerns new business developments.”
The merger has been communicated to everyone concerned. A press release has gone out in Japan; in Singapore, all clients, staff and suppliers have been duly informed.
The focus for local growth will be in new industries and markets outside B&I that The Wok People is not in yet: healthcare and schools. “We can penetrate these markets with support from Green House because of their expertise and experience in these areas.”
Besides integration, another priority will be curbing manpower crunches. “We have to enhance our policies, come up with more ideas for recruitment and retention, and work with government agencies for more trainings and upscaling.” Once these are resolved, overseas expansion can be planned for the next three to five years.
- A NEW CHAPTER
- OTHER AVENUES
- THE RIGHT ONE
- BETTER THAN USUAL
- INSPIRED BY SUCCESS
Inspired by Success
Mr. Chua has gone far in a career that he pursued passionately but did not dream of necessarily. He obtained an diploma in mechatronics from Ngee Ann Polytechnic to fulfil his mother’s wish.
“My mother believed that education could help me lead a better life. She worked three jobs to put us through school. We were staying in a rented flat back then,” he recounted.
His family situation made it clear that he had to study and work hard to improve his lot. And that was what he did.
In 1998, he went into the institutional catering business. “It had low-barriers to entry,” he said. “We didn’t need a big capital to get started. It is also scalable, so we just grew from there.”
The client build-up continued with batches of contract agreements from small manufacturing plants to business in out-of-town locations. These strengthened their knowledge base and prepared to run the same type of business but for different markets.
The turning point finally came in 2000 when their company, Woko F&B, was awarded the staff catering contract by a five-star hotel, eventually catching the attention of other big-league companies to consider their services.
Eventually, in 2005, they sold Woko F&B to a Danish company. In 2009, they decided to set up The Wok People, gradually growing it to the success that it is today – a leader in B&I catering worth S$400 million in annual turnover.
The Wok People has been delivering quality products and services since it started, and at times even raising the industry standards. In 2010, after a year in business, it achieved the ISO9001:2008 requirements.
A couple of years later, it launched an ongoing in-house staff training program, which merited the OHSAS 18001 and Bizsafe STAR certifications that it obtained in 2013. Industry recognitions followed these efforts of strengthening the business, beginning with Enterprise 50 Awards in 2015, Human Capital Partnership Award in 2017, and Skillsfuture Employer Award in 2018.
It also grew the number of sites serviced from 22 in 2010 to the current 65. All these were accomplished within a relatively short span of ten years. Mr. Chua was named EY Entrepreneur of the Year for F&B in 2014 by Ernst & Young.
Despite these achievements, slowing down has not crossed Mr. Chua’s mind. “There is still a lot to do,” he declared, “and a lot more people to nurture and serve.”
What started out for him as a business with great potential has turned into a passion. Success has not spoiled him; it has only inspired him to go on.
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