Today, I’m now going to feature the
life story of the richest man in the Philippines. He is no other than Henry Sy,
the retail magnate who owns all established SM Malls and also a banking magnate
who owns Banco De Oro-EPCI Bank and majority share in China Bank.
This is another inspiring story as
we witness his rags to riches story on how he built all SM Malls and became one
of the biggest bankers enabling him to become the richest man in our country
surpassing both Lucio Tan and the Ayalas.
Let’s learn and be inspired from
another successful entrepreneur story as his daughter Teresita Sy-Coson
narrates the story of his father’s success:
Our company, SM, as many of you may
already know, came from the hard work of my dad, Henry Sy, Sr. It is a rags to
riches story that even myself did not realize until I went to trace his roots
in China.
His journey from the thatched hut I saw there to the shopping centers he has today is something that amazes even myself.
His determination, his discipline
and his thriftiness have produced an astute and street smart businessman who has
influenced a lot of people. Including us, his children.
My father’s perseverance during the
different crises our country has gone through has made our active business
pursuits possible for a half century. True, he was disappointed with the
economy many times, but he never saw the reason to quit and instead pursued his
goals relentlessly.
He had many obstacles – both
external and internal – in his business, and there were times he could not
understand why things had to be so complicated for him to pursue his business
objectives.
It has been written – and I can
attest that it is true – that Henry Sy started from the bottom.
He came to the Philippines at the
young age of 12, and worked in his father’s small sari-sari store more than 12
hours everyday to help him. It was located on Echague St., which is now Carlos
Palanca Sr. St. in Quiapo, Manila. There, he devised ways to increase his
income by developing small portions of products – much like the sachets we see
today in the supermarkets.
He was able to make multiple sales
in order to make extra income, spending so much time in the store that he had
no time to go out and play with friends in the neighborhood. It did not take a
long time for him to realize, however, that he can only do so much in a
sari-sari store environment.
WWII came and the sari-sari store
was looted and burned. He did a lot of buying and selling of odd things during
the war to enable the family to survive.
This must have provided him the
hands-on training for his stamina in business. At one time, he was hit by
shrapnel while selling, and quite fortunately was brought to the hospital by
his good friend in a kariton.
Without that friend, he could have
bled to death. He treasured that friendship and later expressed his gratitude
after the war by making that friend his partner in a shoe store. The
partnership lasted for more than 40 years until the shoe store had to give away
to the building renovations of the lessor.
After the war ended in 1945, he
ventured into selling American shoes imported by enterprising Gis.
He later saw the opportunities of
opening a shoe store, and not long after he was managing three shoe store in
partnership with friends.
With the pleasure of a growing
family while at the same time pursuing studies at FEU in the early 50s, he
sought more ways to augment his income.
He studied the market and decided to
be different. While other young men went to the US to pursue a higher
education, he went on a long business trip to the East Coast, and came home
with a lot of merchandising ideas.
For a time, he was selling a lot of
shoes, accessories, and leather goods, hoping to change the way shoe
manufacturers look at the industry.
Sensing a lot of opportunities, he
decided to open SHOE MART – “SM” – the first air-conditioned shoe store that
merchandised shoes in a very inviting and classy format. With the success of
that store, he went on to open more shoe stores, but he could not get enough
suppliers.
Many shoe manufacturers at that time
could not understand why they had to listen to this shoe retailer who had very
definite ideas on what he wanted to sell. They did not cooperate by providing
him with the volume he needed, and because of that limitation, he gradually
shifted to apparel – and thereafter other merchandise – with the help of my
mother.
He was continuously learning from
his customers, suppliers, and employees. This on-the-job research gave him
enough confidence to expand to a department store chain. Many things in life
grow out of needs, and to meet the needs, you become determined. With
determination you will take extra challenges and do things differently – which
will most likely bring success.
We opened our first department store
in 1972, two months after Martial Law was declared. The business had a slow
start, but progressed steadily. During the Martial Law years, he continued to
open more department stores, reaching a point wherein he could not get space he
needed in the existing shopping centers during that time. He then decided think
long term, and invest in properties for malls, which were patterned after
suburban shopping centers, which he had been studying for some time.
When we started the construction of
our first mall in 1983, the Philippines was in the midst of a debt moratorium
and experienced hyper inflation. The economy decline was further aggravated by
the assassination of Ninoy Aquino. Many bankers predicted our demise because my
dad came from nowhere – he may had a few department stores and shoe stores at
that time, but he was not one of the financial heavy-weights at that time.
Unaffected by criticism, and armed
with sheer determination and optimism, he persisted and opened in 1985 with our
department store and supermarket and a few tenants. Many potential lessees were
saying no to lease offers.
At about the same time, given the
social unrest of the times, our own Shoemart Makati was faced with ugly
strikes. He almost gave up, but through the encouragement of his employees and
customers, he continued. At that time, he decided emotionally draining
disturbances should not overpower him or detract him from his goals. Since that
time, he has not faltered in his confidence, and became even more determined to
continue the business. He also convinced everyone of us in the organization to
follow his optimism.
Later, we expanded, slowly building
malls at that time to get our formula right. The expansion was not without
difficulties. When constructing Sta. Mesa and Megamall, we were faced with
delays in construction due to cement shortages and the 1989 coups.
When the 1997 Asian crisis came, we
were planning our mall expansion, including the Mall of Asia, which was then
envisioned to be the biggest mall in the region.
Because my dad felt the tsunami-like
effects of the region wide crisis, which was unlike any other he had
experienced, we had to change plans. We deferred opening the Mall of Asia, and
went on with the opening of other malls.
We grew in numbers instead of size,
serving different smaller markets. We have also expanded our retail business
beyond department stores to include supermarkets, hardware stores, appliance
superstores, and other retail formats.
At about the same time, we looked
into the banking business – both at our bank and at the industry. At the time,
our main bank, Banco de Oro was a medium sized bank. Because we were quite
conservative in lending, the deluge of bad loans that characterized the times
did not affect us. Given that, we thought it was an opportune time to grow
amidst some instabilities. We reorganized and strengthened our organizations
for about three years and developed growth strategies that started in the year
2000.
Encouraged by the consolidation
program of Central Bank of the Philippines (BSP) in making Philippine banks
more competitive relative to the region, Banco De Oro made few acquisitions
because of the moratorium on banking. It acquired the Dao Heng Philippines
branch, the First eBank, the Banco Santander Philippines branch, the United
Overseas Bank branches, and most recently – Equitable PCI Bank.
Opportunity is where you find it,
not where it finds you. Crisis and weakness indicate one can look for
opportunities. Transforming problems into opportunities can bring good returns.
Prosperity and growth come only to a business that systematically exploits its
potentials and systematically optimizes its performances.
Our business – especially that of
shopping centers is a long term business. It takes at least eight years to pay
back. We feel that the country will always be around, and with Filipinos’ love
for shopping, there will always be customers we can sell to.
We also have to continuously
innovate. Our other retail formats like supermarkets, hardware stores,
appliance stores, home stores, toy superstores, baby stores, and Watsons are
continuously evolving with the shopping habits of our customers. Because they
frequently visit the store, we make sure we have new products all the time so
that their shopping experience will not be boring.
Our group’s policy is to look for
opportunities at all times, and to be ready to act when it comes. While crises
may have brought opportunities, we continue our plans in good or bad times with
some changes to suit our demands of the time.
May Henry Sy’s success rubs off to
us as well. As a final note, I would like to leave this quote from Henry Sy:
““There is no such thing as overnight success or easy money. If you fail, do
not be discouraged; try again. When you do well, do not change your ways.
Success is not just good luck: it is a combination of hard work, good credit
standing, opportunity, readiness and timing. Success will not last if you do
not take care of it.”
Posted: 20 Jan 2009 By Tyrone Solee.
