Breaking into Japan
Another of Chuang’s innovations was to find a way to break into the Japanese market, which foreigners have often found to be impenetrable.
Chuang had in fact long had his eye on the Japanese market. He notes that Japan is a major rice-consuming nation, and not only for table rice but also for rice crackers, mochi, and other types of rice-based snacks, with the raw material being sticky-rice flour.
The problem was that in order to protect its farmers the Japanese government had long banned the importation of sticky-rice flour. Chuang, who was educated under Japanese rule in Taiwan and speaks Japanese well, spent two whole years studying Japan’s customs regulations before finally finding a loophole in 1984. He discovered that France had got around restrictions on imports of wheat flour into Japan by calling it “cake mix flour,” so—after adding sugar to his sticky-rice flour—he renamed his product “rice pastry flour.” This end run around the import rules worked, and today Bangkok Starch sells 500 tons of sticky-rice flour to Japan each month.
In 1998, Chuang, already nearly 70 years of age, showed no signs of stopping his string of creative ideas, and he developed a new product that took markets by storm: rice starch.
Chuang points out that starch has traditionally been made using wheat, corn, cassava, and potato, of which cassava starch is the most widely used. However, overconsumption of cassava starch can lead to intestinal gas and digestive problems. After trying for many years, he finally developed a starch whose raw material is 100% rice, which is more easily digested and has fewer calories.
After water is added and the product is gelatinized (i.e. made more viscous), rice starch is soft and glossy to the touch. Its form is similar to that of butter, and it has the mouthfeel of fat, but without the high calories. It is used in many “diet” products such as low-fat ice cream, low-fat yoghurt, and “fat-free” potato chips.
Dynamism and flexibility
The production process for rice starch requires several steps. First comes soaking, grinding into a pulp, and separation in a centrifuge. Then come multiple washing and drying cycles, and thorough removal of the protein from the rice. Only then do you come up with clean, snow-white rice starch.
Because the process is so thorough, Chuang was able to make an unusual response to the floods in 2011. He unhesitatingly piled up hundreds of tons of bagged rice to dam floodwaters from penetrating his factory. Those outside the loop thought that he had doomed himself to severe losses, but he knew that rice that had merely been soaked in water could still be reused, if quickly moved to the production line and repeatedly processed.
This quick-thinking response to the flooding kept factory damage to a minimum. It also provided a further insight into Chuang’s dynamism, flexibility, and management ability.
After more than four decades in business, Chuang has developed his own operating philosophy. On one hand, he hates clients who come in with big orders and then try to haggle over the price. He might very well tell someone who lays in a huge order for 100 tons that he only can supply 80, so his counterpart will quickly give up ideas of leveraging the larger order for a cheaper price and instead count himself lucky to get anything at all!
But that’s a matter of principle, not avarice. In fact, when the price of raw materials for his products is about to fall, he will take the initiative to notify regular clients to put off their orders in order to save money. “If you want your business to last in the long run, you can’t be greedy. If we reliably provide the best product at a reasonable price, then business will just naturally get better and better,” he says with genuine sincerity.
Afraid to fail
Since the 1970s, Bangkok Starch has grown into one of Thailand’s biggest corporations. Each month it produces over 4000 tons of premium-quality starch, of which over 75% is exported to the US, Europe, and Japan, with the remainder being sold in Taiwan, mainland China, and the Thai domestic market.
Chuang, who never forgets his past, has brought all his brothers to share in his success. At present the family’s business empire—in addition to Bangkok Starch and Thai Preserved Food—has extended into electronics, paper, ceramics, construction, and more, with annual revenues estimated at over 10 billion baht.
Hearty and hale as ever, Chuang still arrives at the office each day at 8:00. He has never considered retiring. Asked how he has come so far in life, he draws our attention to a book that was a bestseller in Singapore: Afraid to Fail.
“If you are afraid to fail, then you fight for every advantage, act prudently, and keep moving forward all the time.” Chuang feels that the tiny country of Singapore has only been able to impress the entire world with its success because its citizens have been too scared of what would happen to them if they got out-competed. He applies the same logic to doing business.
One of Chuang’s most common catchphrases is “What nobody can do, I can.” If you can do what others have not thought to do, or have been unable to do, then you will have carved out a niche, a space, perhaps even an empire, for yourself. Chuang’s perseverance in coming up with path-breaking ideas is all the evidence needed to prove that his catchphrase is, for him, more than just a platitude.
