Pushing boundaries

The Entrepreneur Of The Year Philippines 2017 has concluded its search for the country's most inspiring entrepreneurs. Entrepreneur Of The Year Philippines is a program of the SGV Foundation, Inc., with the participation of co-presenters Department of Trade and Industry, the Philippine Business for Social Progress and the Philippine Stock Exchange. In the next few weeks,

BusinessWorld will feature each finalist for the Entrepreneur Of The Year Philippines 2017.

Charles Streegan President and CEO HCS Management Corporation

WHEN the Philippine furniture industry was at its peak, Charles Streegan, 55, took over his father’s company, Pacific Traders & Manufacturing Corp., which specialized in furniture manufacturing for export.

Mr. Streegan has since developed the company into one of the country’s standard bearers of fine quality furniture.

After graduating from De La Salle University with a degree in Marketing Management, Mr. Streegan was sent to the United States to work with one of his father’s clients. However, his father had taken ill and asked his son to return to Cebu to temporarily take over the company.

Mr. Streegan was still young when he took over the business. When his father recuperated and returned to the business after a year, he decided to venture out and run his own business. It failed after four years, prompting Mr. Streegan to return to the family company.

In 1997, he became president and chief executive officer.

In the late 1990s, he reorganized the group of companies under one holding company called HCS Management Corp. (HCS), which currently includes eight businesses, including the furniture companies Pacific Traders and Manufacturing Corp. and PT Pacific TradersIndonesia, as well as marketing offices in Dubai and the United States.

For a long time, the Philippine furniture industry was the go-to market for international buyers. It became the center of global rattan furniture manufacturing with exquisite quality products known to the rest of the world. However, the market became increasingly competitive. This had a big impact on the local furniture industry, including HCS. “Other countries just got better, like Vietnam and Indonesia,” recalls Mr. Streegan. “They were offering reasonable quality at a lower price.”

A game changer was the depletion of rattan in the Philippine forest. The global economic crisis in the late 2000s also affected the US building and construction industry which was the main market for the Cebu furniture industry. This had tremendous impact on most of the furniture makers and exporters in Cebu.

HCS then considered converting their business to a different industry, but Mr. Streegan decided not to. After studying the feasibility of moving overseas, he set up a factory in Indonesia — the only Filipino-owned manufacturing facility in the country, where raw materials are abundant and cheaper.

In 2010, they set up the marketing offices in the United States and Dubai to be closer to their market.

Mr. Streegan admits some observers viewed his decisions as unorthodox, but they paid off with new markets and the opportunity to manufacture products using new materials, such as teak wood, which is unavailable in the Philippines.

Mr. Streegan also said that customers approached HCS for its innovative designs and competitive pricing. He narrates that when buyers go to HCS showrooms, they get to see first hand the quality of materials used, the company’s design capabilities and its manufacturing facility.

HCS has maintained a brand and reputation of good quality, design and service.

“In this business, nobody remembers the nine good things you did, they’ll remember your last bad job,” Mr. Streegan noted.

“We have built our reputation and our brand over the years, and now we have a lot of customers who stand by our product.”

HCS’ designs and ability to execute those designs sustains its competitive edge. To maintain this edge the company trains craftsmen in the appropriate artisan skills like weaving and carving.

For Mr. Streegan, technology has had a big impact on marketing efforts. HCS launched a Google Showroom in the USA. “It’s almost like virtual reality. People can browse through our selection via the Internet without needing to physically travel,” he said.

Simultaneously, the company is also developing a local version for the Google Showroom for the Filipino market. By slowly shifting to virtual, it is increasing convenience for customers and promoting pricing transparency.

The company’s long-term plan is to continue to strengthen its design team. It intends to make its Cebu facility its manufacturing hub while using the Indonesian plant for more conventional or traditional products. The goal is to be able to manufacture, source and buy from anywhere in Asia. Mr. Streegan also plans to bring in younger managers to help build a strong, progressive organization.

HCS has received recognition over the years, including the Philippine Golden Shell Award for Outstanding Performance in Export and the Outstanding Respondent among Large and Medium Firms covered by the Business Expectations Survey of the Bangko Sentral ng Pilipinas.

For this entrepreneur, passion is critical to success. “Do what you like best and never be afraid to fail,” Mr. Streegan said. “Don’t be afraid to make mistakes. If you don’t make mistakes, then you’re not pushing the boundaries.”

The official airline of the Entrepreneur of the Year Philippines 2017 is Philippine Airlines.

Media sponsors are BusinessWorld and the ABS-CBN News Channel.

Banquet Sponsors are Bench; Bounty Fresh Food, Inc.; CDO Foodsphere; Fiori Di Marghi; Global Ferronickel Holdings, Inc.; Hyundai Asia Resources, Inc.; Intermed Marketing Phils., Inc.; Jollibee Foods Corp.; LBC; SteelAsia and Universal Harvester, Inc.

The winners of the Entrepreneur Of The Year Philippines 2017 will be announced in an Oct. 18 awards banquet at the Makati Shangri-La Hotel. The Entrepreneur Of The Year Philippines will represent the country in the World Entrepreneur Of The Year 2018 in Monte Carlo, Monaco in June 2018. The Entrepreneur Of The Year program is produced globally by Ernst & Youngs.