NATIVIDAD YABUT CHENG Co-Founder and CEO

URATEX GROUP OF COMPANIES

NATIVIDAD YABUT CHENG, co-founder and CEO, is an inspiration to many. With her very low-key and simple ways, Mrs. Cheng enjoys the company of the ordinary and loves the simple things most wealthy people unnecessarily deprived themselves of.

But her amazing journey has remained largely untold until lately when her and her company’s sterling accomplishments have been recognized by a prestigious award giving body that people start to get snippets of endearing information about the woman behind one of the country’s very few, but most enduring manufacturing companies – the Uratex Group of Companies.

Humble beginnings

Mrs. Cheng is of Chinese descent, but truth to tell, not all Chinese are born to a privileged family. She was one of them.

As a child, she shared one apartment with 24 people from four families. They only had one comfort room and one bathroom. She experienced skipping meals because there was no money at all for food. Looking back, she could not imagine how they were be able to survive those difficult days.

Mrs. Cheng also dreamt of becoming a nurse on hopes to uproot her family from poverty. At that time, working as a nurse in the US was very lucrative, but her parents cannot afford a college education that she had to drop out from college and started working.

She got married at 22 years old to the late Robert Cheng and were blessed with three children.

Like most Chinese, the young couple immediately went into buy and sell business. Robert was into furniture retailing and construction materials supply. It was a very small business with R4,000 capitalization, but they developed contacts along the way. They got the idea to venture into a small foam manufacturing business. In 1968, Polyfoam Chemical Corporation Corp. was set up initially producing foam for garments, shoes, beddings and furniture producers.

Uratex

Today, Uratex is the country’s biggest foam manufacturing company in the country supplying 70 percent of the local market with foams, mattresses, pillows for all applications may it be industrial, commercial, and the consumer markets.

“We started as husband and wife team only so we can save and if there is no driver to deliver the products, my husband was the one doing the delivery,” says Mrs. Cheng, proud of how hands-on they have been. They eventually grew to 10 people. Now, they have a strong workforce of 3,000 as they continued to upgrade their equipment and adopt new technologies to produce various foam grades for various product applications.

“The garment sector needs a different kind of foam to be sewn into the clothes, the shoe maker needs another grade for his shoes and there were lots of cottage industries like basket and pot holding making that blossomed during President Macapagal’s time,” says Mrs. Cheng.

For industrial and commercial applications, a foam is used for heat insulation purposes. Foam is also used in the automotive industry and even in the electronics sector.

Now, Uratex produces 1.6 million cubic meters, equivalent to 25 kilotons or 25,000 tons of actual foam.

In the past few years, demand is mostly concentrated in the consumer sector. Sales in this market segment already accounted for 60 percent of Uratex total business. Because of the many new condominium buildings and housing projects, there is strong demand for household mattresses, pillows and other home and living products.

Uratex has been enjoying brisk business. Last year, Uratex posted a 16 percent increase in sales and is expected to grow higher this year despite higher cost of chemicals and other raw materials

Expansion The Cheng couple proved to be visionaries. Mrs. Cheng said she learned her foresight from her late husband.

For instance, the company’s expansion by installing new equipment has always been in anticipation of the birth of new foam applications.

Since their products are bulky and heavy, the Chengs foresaw the need to put up operations in other areas outside of Metro Manila. With that in mind, the couple started landbanking in the regions. They bought properties in key cities when prices of these lands were still very cheap.

They have operations in 22 cities, including Iloilo, Davao, Cagayan de Oro, and Cebu. Under construction are new facilities in Butuan, Bacolod and Tacloban. The biggest plants are the one in Plaridel, Bulacan and in Sucat, Alabang.

“Our products are very bulky and the freight cost is very expensive,” she adds, noting that freight cost from Manila to Cebu is more expensive than shipping from China or Taiwan to Manila.

Innovation Despite her age, Mrs. Cheng is not averse to innovation. The matriarch is a big believer in innovation and she does not stand in the way against getting the best technology from Germany, US and Japan.

Recently, the company embarked on a R600-million state-of-the-art equipment to upgrade its existing facility in Plaridel, Bulacan. This is in anticipation of the resurgence in the industrial sector. With the government’s strong push for the manufacturing sector, there could be additional demand among industries. This new foaming equipment is expected to be fully operational in 2019.

“Some industrial firms left the country because of labor issues before. They went to China and now to Vietnam and Indonesia,” says Mrs. Cheng. Fortunately, they were not affected by the labor unrest in 1986.

Aside from its capital-intensive operation, the Chengs always invest in research and development. This is one distinct characteristic of businessmen with long term planning. In fact, one reason for its continued growth is its focus on coming up with technologically advanced and world-class products.

Uratex employs technical foreign consultants and technology experts to make their manufacturing operations and products at par with the world’s best.

“Our operation is very complex,” says Mrs. Cheng noting they have 100 different kinds of chemicals to produce different kinds of foam.

A mistake in the use and mix of chemicals could spell disaster to their products. One time, the Chengs wanted to go into the production of chemicals on hopes they can be fully integrated, but it turned out very expensive.

Uratex imports most of their chemicals from international chemical firms such as Bayer/Covestro, Dow, Shell, among others. Its equipment and machineries are also imported from Germany, US and other countries.

With advanced technology and strict adherence to standards, Uratex is a certified environment-friendly company.

“We have ozone-friendly certification from the Department of Environment and Natural Resources since 1996. Our products have voluntary standard certificates that they don’t contain volatile compounds nor hazardous chemicals,” says Mrs. Cheng.

To ensure buyers of products using foam are not shortchanged, the company is now putting a mark on its foam “Uratex Inside.” This will ensure that the products are fitted with quality foam.

All of these efforts have kept imports at bay.

“If there is any complaint, I am but just here. I am not going away,” says Mrs. Cheng. They are also able to sell at very affordable prices compared to the imported household mattresses.

“Our price is 30 percent cheaper than a US brand and these importers would always say that our product is fake. We are using the same technology that these imported products are made of,” says Mrs. Cheng.

Diversification The Chengs’ foam business has paved the way for their expansion into other businesses. Unknown to many, the family is into the automotive sector under the company subsidiary Robert’s Automotive and Industrial Parts Manufacturing Corp., which supplies automotive foam and automotive parts to top car assemblers in the country.

Car assembly requires foam for insulation and upholstery. They also supplied mufflers and stamped body parts, radiators, leaf springs for Toyota, Mitsubishi, Ford and Chrysler in 1974 for radiator, leaf springs and mufflers and stamped body parts. The company also supplies complete car seats and motorcycle saddles. But they lost a huge business in the automotive sector when Ford Motors withdrew its Philippine operation and relocated to Thailand.

They are looking into getting more business in the automotive sector under the government’s Comprehensive Automotive Resurgence Strategy (CARS) program. The CARS Program is expected to again provide impetus to local automotive parts manufacturers and suppliers.

For the CARS program, the company is investing at least R200 million for the production of mufflers and stamped body parts, which has 23 metal body parts, for the assembly of Mirage car by the Mitsubishi Motors Philippines.

They also supply Toyota with mufflers and special foams for VIOS and Innova. The did the same for Mitsubishi’s Adventure.

Aside from foam and automotive parts, Uratex has gone into related products such as monoblock chairs. Uratex has also forged a 50-50 joint venture company Inoac Philippines Corp. with Inoac of Japan for the supply of special foam for electronics products. This makes Uratex an indirect exporter.

Recently, Uratex ventured in a partnership with a Belgian company into the avant-garde furniture.

Other related ventures include RGC Textile, Six Inch, Uratex Monoblock, Uratex Premium and Uratex Ready-Wrap Containers.

The Uratex Group did not stray far from their core business, until Mrs. Cheng saw that a big portion of their 30-hectare Plaridel plant area lying idle. This has awakened her soft spot for agriculture. She now has a total of 50 hectares of ricefield in Bulacan.

Whatever her people say to improve harvest, she would readily comply whether this could be equipment or seeds. They are now profitably selling palay for a business she considers sideline.

Visionary

Mrs. Cheng has inherited her husband’s way of looking at the long-term horizon and to dream big. The R600million expansion is a strategic investment because foam capacity is expected to soar in the next five years.

“It takes time to build a plant, say two years, so we need to plan ahead so that when the growth comes we are ready,” says Mrs. Cheng.

Part of their long-term plan is supply inventory management. Uratex has not experienced running out of materials because Mrs. Cheng always sees to it they stock up on supplies direct from suppliers because it takes 90 days to order from Germany. This way, they are able to save on cost.

“We are very good student of life-long learning,” says Mrs. Cheng, who trained their three kids early in life to learn the ropes of the business with her daughter already issuing checks at the age of 9.

“All of them are involved in the business,” says Mrs. Cheng. Pinky, the eldest daughter, is in charge of finance and customers. The middle child Peachy is the COO. Bigboy, the youngest, handle marketing and sales.

“My kids have free-hand to decide, but they always ask me first on major decisions,” says the matriarch.

Notably, despite the fact that she has not finished college and no formal education in running a business, Cheng can beat any new entrepreneur there is. How did she do it?

“I love to read newspapers while the TV and radio are on. I read all the parts of a newspaper every morning including the comics. I picked up the books left on the street, but I don’t read fiction,” says Mrs. Cheng. She watches Bloomberg, making her abreast of the world of finance.

Mrs. Cheng is also active on social media with her Facebook account, just to update her of what has been happening online real time.

She is not intimidated by technology, too. She always Google everything she does not understand and learn from it. In fact, daughter Peachy, who enrolled in a high-level finance course was surprised that her mother already knew all about hedging and forex transactions.

In terms of financing and banking transactions, Mrs. Cheng never lets anyone deals with that but herself saying, “I can bully the banks.” Banks have been very supportive of Uratex.

Uratex is not discounting the possibility of going public, but they really don’t need outside capital. Besides, Mrs. Cheng would like Uratex to stay a familyowned enterprise.

Generosity If there is one thing she regretted, it is her not being able to finish college. While she made it big in this world without a college diploma, Mrs. Cheng does not encourage that. That is why she vents this frustration by becoming a generous patron of education, sending hundreds of scholars, not just the kids of their employees. She also diverted the funds allotted for her husband’s Caddie Tournament in the Philippines, which is the first in the world, to the more meaningful scholarship fund. They have 300 scholars right now. They have professorial chairs in the University of the Philippines.

Uratex is celebrating 50th year in 2018, but it has set its eyes farther. Uratex aims to be included in the elite group of 200-Year-Old Club Companies where there are only 38 members.

Uratex is still a first-generation company, although the matriarch has been gradually passing on the reigns to her children. Mrs. Cheng has been thinking of leaving behind a Family Constitution to keep the legacy intact. The operation is now ably assisted by professional managers. Some of the staff now are children of their original workers.

Another thing that separates the Chengs from the rest of the successful businessmen is there being simple and down to earth, never forgetting how to be ordinary.

Their customers now are already the children of their previous customers. “There are many in the company who grew up with me,” says Mrs. Cheng, who loves simple things like taking photos with his workers, especially in the provinces.

She never fails to stand as godparent in any wedding when she’s asked to even as she looks forward to meeting people during town fiestas.

Mrs. Cheng continued to lead a simple life at her old residence in Project 7 in Quezon where she holds office on the ground floor. She is not difficult to talk to when it comes to financial support.

“Lack of education is not a hindrance for one to succeed in life, that has always been my constant sermon to my people,” says Mrs. Cheng, who also encourages his staff to do some business on the side because one cannot rely on mere salary to support a growing family. How many times she has extended financing to employees, who are eager to start a small business.

“A mere salary is not enough so I encourage my staff to have double income to hurdle difficulties, take up a small business,” says Mrs. Cheng, who has been very forgiving to her staff. Even those who committed mistakes are given several chances.

Integrity

Over the years, Uratex continues to harvest awards and recognitions, but Mrs. Cheng only accedes to a few that she believes are worth it. But she treasures the awards given to them by customers because these are good gauge of their performance and how their customers perceived them.

Some of these prestigious awards include the Bossing Award. The most recent is the prestigious Ernst and Young Entrepreneurship award. Mrs. Cheng, who bested other entrepreneurs for the Entrepreneur of Year 2017 and the Master Entrepreneur of the Year for management excellence, will represent the Philippines at the World Entrepreneur of the Year Awards in Monte Carlo, Monaco in June 2018.

“We’ve always believe that through innovation, Filipino can conquer anything, any place in the world,” says Mrs. Cheng.

As a company, Uratex has also cultivated a company culture of integrity, hardwork and perseverance, and being a practical spender.

“You cheat once and people think you are a cheater your entire life. So, integrity is very important to us,” says Mrs. Cheng. They did not cheat when they were poor, the more they cannot do it now that they have more than enough.

“We have to be honest, even if we lose money,” says Mrs. Cheng, who has no intention of slowing down. She works from home and finishes her job at 10 pm.

“I don’t want to retire, it is difficult when there is nothing to do. Founders never really retire, perhaps in name only,” says Cheng, who allots 30 minutes every day for exercise.

“It is always stressful if there is no work,” says Mrs. Cheng, who allows her employees to call her Nanay or Lola and her husband was called Tatay Robert, who was equally known for his generosity.

She travels a lot also, tagging along with her some 20 employees from any rank each time just to bond and share stories. She knows how to take care of employees, giving them more than what the law provides.

The daughter of a pure Chinese father married to a Filipina, but they always behave and act Filipinos all the way and speak Tagalog all the time. Even during interviews, she insisted she speaks Tagalog.

She is not judgmental and treats everyone with respect. She welcomes all religions and even reads the Muslim Koran and the principles of Buddhism necessitating her child to ask what kind of priest to call when her time comes.

Mrs. Cheng’s story is one that inspires every Filipino, and as she would say, “There are no excuses, wherever you are in life, there is no reason why you would not rise up and achieve your dreams and make a meaningful impact on the lives of others.”