Orient to deepen its presence in health food
Industry is moving towards a niche market
FROM humble beginnings as a trader of raw materials for health food back in 1995, Teoh Eng Sia decided to cautiously take the next step of venturing into the health food business.
In 2000, he started his good manufacturing practice or Gmp-compliant plant in Batu Caves, Selangor, as an original equipment manufacturer (OEM) of health foods.
Teoh, who is the founder and managing director of Orient Biotech Sdn Bhd, tells Starbizweek that one of the reasons he decided to venture into the health food business is to help others improve their health and well-being.
“Back then, I saw many people including friends and relatives suffering from illnesses, and therefore decided to do something which will improve their health and see them rejoice over their good health. This has given me satisfaction and motivation to march forward.
“To look for a niche market, I started a research and development (R&D) team in 2002 to undertake original design manufacturing (ODM). Since then, my focus has been on ODM for the health food and supplement business and it has more than 100 products under its stable,” he adds.
Currently, about 50% of the company’s products are sold domestically with the balance for the export market. Its export destinations are Singapore, Taiwan, Thailand, Hong Kong, Indonesia and Vietnam.
Commenting on the challenges he had to face when he ventured into the health food business, Teoh says, “Like most entrepreneurs, initially I encountered issues of insufficient capital, market penetration, lack of management skills, quality and professionalism to lead a management and marketing team.
“With the passage of time, my hard work and willingness to continuously learn and improve has taken me to where I am today. I am glad I have accomplished many milestones. In 2021, the company was awarded Asia Pacific Top Excellence Enterprise.
“Among the other accolades we have achieved is the small-to-medium business or SMB Recognition Award in 2008, the United States Food and Drug Administration and Hazard Analysis Critical Control Point or HACCP certification in 2013, and the OTC GMP Certification in 2014,” he says.
On how different Orient Biotech’s business is compared to its competitors, Teoh says his focus is on stringent quality control as this is important in churning out quality products with functional health food benefits.
He strongly believes that “food is medicine if used wisely and not medicine as food”. Apart from a strong emphasis on professionalism and as a one-stop solution to customers, the company also provides products that are registered with the Health Ministry.
Besides this, he says the company also supports export facilitation for its customers, and carries out ingredient sourcing, quality control and assurance to further boost its products in the market.
As part of its expansion plans, he adds that Orient Biotech has bought a six-acre industrial plot of land and intends to build a factory with modern automation facilities which will place the company on a stronger footing in the health food and supplement business.
The reason for the new factory is to meet the strong demand for its products, he says, adding that due to the Covid-19 pandemic people tend to be more health-conscious. Hence, the robust demand for health products.
Its current manufacturing facility is located at Taman Industri Prima Selayang, Batu Caves, and caters to customers in the business-to-business or B2B segment.
They include pharmaceutical chains and those in the health food industry.
In terms of competition, Teoh says, “The health food and supplement industry is moving towards a niche market.
“In this sense, we provide one-stop services, end-to-end production, market studies, proprietary formulation, and support the committed young entrepreneurs in online marketing as well as supporting product development and consultation.
“We also have our own market research team, brand development and design facilities, among others. The company treats its customers as synergy partners who are looking for quality products and not merely quantity.”
Health food, unlike commodities, is a niche market with stringent quality control and is a regulated business as it is registered with the Health Ministry, he says.
This type of business he adds, is also subjected to audit by the government for the issuance of licences, permits and approval of relevant facilities.
To a question on the health food business, Teoh says due to the pandemic there is greater health awareness and people are more health conscious. This has translated to stronger demand for health food and supplements and given a boost to the industry.
“For this year, we estimate that the local industry’s revenue growth will exceed 10%,” he says.
The global dietary supplement market is projected to grow at a compounded annual growth rate of 8.6% from 2021 to 2028, according to Grand View Research.