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Management Essay

HI-O Enterprise established in 1975, has since become an established household name offering a wide range of Chinese medicines, medicated tonic, wellness, beauty and healthcare like quality Traditional Chinese Medicines, teas, wines and consumer products. HI-O is principally engaged in the wholesaling and retailing of herbal medicines and healthcare products and investment holding. The business segments of the Company include wholesale, multi-level marketing, retail, manufacturing and others. The wholesale segment includes wholesaling and trading in herbal medicines and healthcare products, herbs and tea.

The multi-level marketing segment includes operating multi-level direct marketing of healthcare and beauty products. The retail segment includes retail chain stores. The manufacturing segment includes manufacturing, producing and distributing pharmaceutical products, alcoholic and non-alcoholic drinks. The others segment includes businesses involving leasing of machinery and equipment, licensed money lender, insurance agent, advertising services, rental income, trading of clocks and investment holding.

Besides, they have developed multi-distribution channels that give them broad access to Chinese medical halls, hypermarkets, parameters, convenience stores, and food & beverage outlets. Currently, they have more than 50 experienced and dynamic sales personnel and promoters to serve the wholesale market. Recently, Group managing director Tan Aka He told Starlit, they will introduce new creative products and

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adding new distributors will help drive their multi-level marketing (ML) business. Tan added that HI-O planned to introduce new technology products by early next year under a newly formed Energy Division.

He said the new division would help to offset the slowdown in ML business and would be the company’s growth driver in the future. From the annual report 2012, we can know that the Wholesale Division of HI-O is looking to expand its business network and to rulebook at its product mix and marketing strategies to capture younger and newer market. Other than that, For the Retail Division, it will continue to develop more new house brand products to expand its product mix, thus to enhance its profitability. A series of new products has been launched to expand its product mix and to cater to a wider group of target audience.

The new products launched were: Hondo Memo Care Plus, Hondo Vital Line, GLOB ACTA Essence of Chicken, HI-O Twin Happiness Gift Pack, Green Essence Diet Cafe and Royal Cracker Healthy Snack. The response to all the products was encouraging. MISSION AND VISION Mission We are committed to promoting healthcare culture and improving humans well- being. We aim to become the premier healthcare company in Malaysia and thereby bringing the greatest value and pride to our customers, business partners, employees and shareholders.

SOOT ANALYSIS Strengths The strength of Hi-O Enterprise Bertha is their successful marketing techniques; they provide a fair and reliable system to all distributors. Their commitment has provided customers with comprehensive support and incentive programs. They have more than 70 chain stores, which enable them to have a strong retail business. Each store will also by the professional herb masters to provide advice on herbs and Tics to customers, this will serve as part of their service. SAG Global Biotech Sad Bad is the 1st traditional medicinal plant to comply with Good Manufacturing Practice (IGMP) standard in Malaysia.

Their commitment to quality has been rewarded with ISO 9001. They also set up an analysis laboratory arm IIS Research Laboratory Sad Bad ratified with Good Laboratory Practice Standard (GULP) to perform various testing services to meet the stringent quality controls. The laboratory is run by a team herbal monograph, including qualified chemists, microbiologists and experienced staff to meet customer demand. They will ensure that herbal research process and the quality of the herbs in compliance with the procedures to protect the safety of customers; meanwhile comply with Department of Standard (ADSM) requirement.

Weaknesses The lack of talent of the Chinese medicine profession becomes the problem for Hi-O Enterprise Bertha. Only some of Hi-O chain stores are providing integrated medical services by making available in-house consultations by qualified ETC physicians. Plan in 2012 is expected to bring a decent performance, but based on the limited space of the shares rose, still unable to achieve a breakthrough. As the supplier of the Chinese herbal medicine, they have to face more and more debate about its effectiveness and potential side effects.

The safety and quality of finished herbal medicine products require tests on their resources which at one point can comprise hundreds of natural constituents. Chinese herbal medicine is lack of international standards and evaluation methods, some countries do not have the policies and regulations of traditional medicine. Products of traditional medicine are produced form natural elements which mostly are collected from wild plants. Scarcity of resources could also be an issue for business practices.

Opportunities Hi-O Enterprise Bertha decided to improve their marketing strategies to use the multi-level marketing business, so they have a more balanced product group. Hi-O Enterprise Bertha has signed a world distributorship of Exam Bamboo Salt to expand a new market and the bird’s nest export business is expected to recover. The Beijing Tenanting Co Ltd and Hi-O Enterprise Bertha recently contracted associates, to set up a bird’s nest Holdings Limited in order to extraction, processing and distribution of bird’s nest and bird’s nest products. Cooperation with them, Hi- brand culture.

There have professionals communication and learning to enhance the level of traditional Chinese medicine knowledge. Strengthening the existing health care services, and actively explore the field of pharmaceutical equipment, to promote search programs, and to promote investment in the field of medicine. Hi-O merged with Yang O Holdings SUB which is sourcing for and processing, trading and distributing bird’s nest. Once it obtains the license to export bird’s nest, this will represent another good revenue stream for the company since the consumption of the product in Asia, especially China.

Threats China has banned the import of bird’s nest for Hi-O Enterprise Bertha because the bird’s nest exports to China containing excess nitrite, which is commonly used to preserve meats but can also cause cancer, in last year July. More than that, other competitive enterprises such as E Yang Sang and Brand’s gradually to replace their herbal medicines position in Malaysia. Indonesia ML operation is still relatively small and not making much progress due to fierce competition and strict regulations.

They have been applying for the license for the past three or four years for their Indonesian subsidiary P. T. To approve their products. If they still cannot get a license from Indonesia which will bring the loss and investors will also lose the confidence to invest in their company. GRAND STRATEGY OF THE COMPANY Hi-O Enterprise Bertha has become a biggest premier healthcare company in Malaysia. The aim of Hi-O Enterprise Bertha is bringing the greatest value and pride to their customer. One of the obvious strategies to market its product is the group formation of Hi-O Marketing Sad.

Bad. Most of the health food, wellness, and beauty products are sold by Hi-O company. The strategy has successfully boosted the group business and a huge exposure for Hi-CO’S brand into customer market. Hi-O sources raw materials for its produces are from the main land China. Traditional Chinese Medicine market in china is saturated and the products are rarity. However, Hi-O Enterprise Bertha is devoted to solitary select the right ones to bring into product line. The group is selling genuine quality product at a fair price with Hi-O branding to build its clients trust.

Since the setting of its Multi-Level Marketing Division, Malay customer have constituted a large segment of fits market as well as its sales forces, which has result in remarkable transformation for Hi-O as a group. One of the famous product among Malay consumer is ‘Purr Ere’ tea. ‘Purr Ere’ tea considered as a wonder tonic with abundant health benefits ranging from removing coins to improving blood circulation. The Group’s image has been changed after they are achieving reputation among the Malay customer. The power of traditional medicine has shown the evidence results in today’s healthcare industry.

Therefore, the group decided to take the business abroad by penetrating the lucrative markets of China and Indonesia. Hi-O Enterprise Bertha venturing into the international market is the one of their brand even further and promote their company products especially Chinese medicine to a higher level. Firstly, the company is used the cost -leadership competitive strategy to compete tit other company which is selling the same type of products such as Mamma and CNN holdings, and this 2 company are the main competitor of Hi-O enterprise.

The strategy is use to decrease the price of widely needs product to gain less profit over other competitor. Secondly, Hi-O company purchases raw materials from China because of the goods of China are inexpensive compare to local country, and it can lower the cost price, so the company can implement the cost-leadership strategy in the market for compete with other in lower price. Besides that, the company are using the technique reduce the production process cost for lower the cost. For example, the “Natural Toothpaste” produce by Mamma company, the price is ARMS. 0; “Nature Paste Toothpaste” produce by Hi-O company is only ARM 22. 50, toothpaste is widely needs product Hi-O company is using the low price to sell this product, so its shows that the Hi-O enterprise is using the cost-leadership strategy. In the other hand, the company is also use differentiation strategy, which is increase the quality of the products as a way to attract buyers to choose their goods over the similar product of other company and this is also widely need by the market.

For example, recently the company is produce a new product called “Bamboo Salt Premier Drink” , it is the natural salt made of energy seawater generated by the vast underground(West Coast of Korea), this salt contain inorganic metal which are essential for human body. The advantages is can remove toxin and improves restorative capacity of our body. Nowadays, only a little market is selling this product in the market, so this very unique product. This product is more special than the other company health drinks, therefore, Hi-O is using the differentiation strategy compete with other competitor.

UTILIZING THE IDENTIFIED STRENGTHS AND OPPORTUNITIES According to the SOOT analysis we have done, we can know that Hi-O Enterprise Bertha has an efficient distribution network system that give the organization implement the task effectively. This may help the company to expand their business successfully. For instance, it can start new branches to the international stage and create new products and services based on its well management to improve market share.

Hi-O Enterprise Bertha had been received many rewards from various aspects such as The Brand Laureate Award, CIO 100 Honoree Award and so on, that cost up the reputation of the company. The company can take this advantage to do a lot of promotion or advertising because the quality of the goods and services had been aware of the government to attract more investors and customers. Besides, IIS Research carries out the research and testing the Traditional Chinese Medicine (ETC) to maintain the grade of products.

This is one of the factors that have made Hi-O become the leader of Traditional Chinese Medicine’s market. Other than that, the Multi-Level Marketing is one of the plans that can broaden the market. The company not only considers the Chinese customer and also the Malay customer, Indian customer and the others. Hi-O Enterprise Bertha is the sole cooperate which gained the distributorship of Exam Bamboo Salt. This is one of the strategies use by the company to overcome loss on the birds’ nest export-business customers with acquires the distributorship of Exam Bamboo Salt.

This is because customers can easily get the product in Malaysia. Furthermore, Hi-O Enterprise Bertha cooperates with a well-renowned Traditional Chinese Medicine company, Beijing Tenanting, to get back the birds’ nest market in China. The market will also develop rapidly due to the company has merged with new subsidiary, Yang O Bertha. OVERCOME THE IDENTIFIED WEAKNESS AND THREATS From the SOOT analysis above, Hi-O Enterprise can gives workers the training and send them to interact with the professional in this area to solve the situation of lack of profession.

The company may have an internship with universities or colleges to discovery the students who are talent in this aspect. For example, Hi-O Enterprise Bertha had been agreeing the internship with ATTAR. Besides, the company can develop a land to plant their own resources to overcome the problem of limitation of Traditional Chinese Medicine. The quality and safety of the resources also can be errant. Since there have ethnic diversity, Traditional Chinese Medicine are not acceptable by all the country, the company come out some methods to produce new products which best suited with the people all around the world.

The company can utilize IIS Research Laboratory to carry out the research to find the way of reducing the nitrite. The existing of the competitors like E Yang Sang, Brands may become an incentives to the company to work their best. The company can realize and recover the weakness of the company by comparing the company’s performances with other competitors. The company also can obtain the information from their competitors by public and advertising to strengthen the management of the company.

A good relationship with customers must be maintained via doing survey and feedback to customer, that In addition, the company can seek out the new markets against with Indonesia such as Manner, Singapore, Brunet and so on. CONCLUSION Hi-O Enterprise Bertha has an excellence achievement and good reputation base on the rewards and recognitions of the company. The valuable rewards and recognitions are including CIO Sais’s Annual Index of Sais’s Top Performing, The Brand Laureate Award CIO 100 index highlights top 100 regional enterprises and organizations that have excelled through creative and innovative IT projects in the past year.

Companies that achieve CIO 100 listing have broken new ground by using IT systems, initiatives and projects to provide added value to their customers. The Brand Laureate Award International Best Brand Awards SUMS can be expressed as the organizational structure, procedures, processes and In the 21st century, SMS has tended to converge with sustainability and transparency initiatives, as both investor and customer distraction and perceived quality is increasingly tied to these factors.

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