A new elegant seven-storey building stands out among the other industrial properties surrounding it at 9 Jalan Kilang Road. Equipped with the latest pharmaceutical machinery, large warehousing spaces and an office designed with nature in mind, Borden's facility is vastly different from what it used to be.
"Before 2006, the company manufactured its products in a small single-storey factory which limited our manufacturing capability," said Christopher Yeo, managing director of Borden Company. "Therefore, we decided to upgrade our facilities to prepare the company for growth."
Borden's newly increased manufacturing capability allowed the company to soar higher by riding on its famous Eagle Brand medicated oil. In 2012, Borden won the Enterprise 50 Awards for the fourth consecutive year and has consistently been awarded the title of "Best Selling Medicated Oil at Watsons". These achievements are a testament to the company's success in the competitive pharmaceutical industry.
But it has been quite a journey since the homegrown company started in 1960. Borden produces the Eagle Brand medicated oil, affectionately called the "green oil" by loyal users due to its distinct colouring. The oil was formulated in 1935 by a German chemist and went on to dominate the local medicated oil market during the post-war period. Borden then decided to expand overseas. Upon its introduction to the Vietnam market, the oil gained widespread popularity. Borden has since continued to expand its presence and now exports to more than 20 countries, including Australia, the United States, South Africa and the United Arab Emirates.
The success of the company can be attributed to the founders of Borden and the new-generation leaders who ensured that the company remain relevant over the years. This is done by adopting a smart business model which integrates lean manufacturing, strong marketing and a high degree of innovation.
Recounting Borden's past, Mr Yeo shares the founders' vision: To attain great heights and soar above all others, an eagle's body has to be light and nimble.
Thus, Borden keeps its business operations lean by focusing on its core expertise in product manufacturing. With manufacturing done in-house, Borden appoints distribution partners with ready networks of pharmacies and supermarkets. "By outsourcing distribution, the company is better able to channel its time, efforts and resources on value-enhancing aspects of the business such as brand-building and research and development," explains Mr Yeo.
Potential distributors are shortlisted based on a thorough internal evaluation that considers their enthusiasm to carry and build the Eagle brand, and the strength of their distribution network among other factors. Many are granted exclusive distribution rights for the products in their respective markets.
Borden allocates 12-15 per cent of its revenue to advertising. The success of branding the green oil as a premium item can be observed from the success in Vietnam. Despite its premium pricing, the oil is widely recognised there as the go-to remedy for varied illnesses. During festive occasions, the medicated oil in its premium shiny packaging is often used as a gift.
The last element of Borden's three-pronged strategy is to constantly innovate to keep up with the changing environment. Borden tapped its expertise in analgesic products and expanded the Eagle Brand to include a wider range of products such as muscle rubs, disinfectant sprays, muscular balms, plasters, inhalers, alcohol swipes and eucalyptus oil. These products have been readily accepted by consumers.
As the business grew, Mr Yeo recognised the need for further development. The first step was to build a larger manufacturing facility. Trained as an architect, Mr Yeo recognised the trend of decreasing construction costs in 2006. Borden reaped significant savings in construction costs when redeveloping the single-storey factory, that it had occupied since 1975, into a new seven-storey office cum light industrial building. While other SMEs worry about rising rental and consider outsourcing their manufacturing, Borden can continue to produce its medicated oil locally as it owns the whole building. The "Made in Singapore" label on all of Borden's medicated oil bottles further reinforces the premium branding.
Mr Yeo recently decided to raise productivity by investing in a production line which is faster and requires less labour. The new automated machinery improves manufacturing productivity by at least 40 per cent and frees up manpower for other areas. Tapping Singapore's Productivity and Innovation Credit scheme allows Borden to benefit from huge tax savings. Praising it as a "wise scheme for SMEs", Mr Yeo expects the company's overall business process to improve with the installation of the new machinery.
Similar to the tenacious eagle that uses storm currents to soar to greater heights, Borden is quick to seize opportunities even as it faces challenges head-on.
When the Sars epidemic occurred in 2003, it quickly recognised that there would be an increase in demand for disinfectant wipes and sprays. The company swiftly innovated and manufactured these disinfectants and brought them to market.
Counterfeits of the green oil are commonly found in developing countries where intellectual property laws are not widely enforced. To help customers distinguish the authentic and counterfeit products, Borden incorporated three-dimensional holograms with security features in its product's packaging. Borden also works closely with regulators to conduct raids on illegal counterfeiters by using information obtained from distributors or private investigators.
Borden is keen to reach out to the younger group of consumers as well. Traditionally, the company's primary target market comprises working adults and the elderly who favour external analgesics. Borden is aware that if the younger population does not adopt its products, its longer term future may be at risk. The company gives free samples of its products in orientation packs for tertiary institution students and sets up booths during sporting events to provide free muscle rubs. Borden is looking for new platforms to reach out to young adults such as through the use of social media. Its R&D department is also testing new formulations to appeal to younger consumers.