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True to tradition
ALONG a row of shophouses in Bukit Pasoh sits a newly renovated three-storey house richly decorated with traditional Chinese paintings, porcelain and jade collections, antique chairs and family photos.
This is the private museum of the family behind Axe Brand Universal Oil, the humble medicated oil made by LKF Medical that has spread from Singapore to more than 50 countries around the world. Smiling faces peek up from photos of all the places the oil has been: Bahrain, Cuba, India, Qatar, even Iraq and Sudan.
Asked about his sprawling business empire, Leong Mun Sum, the spry managing director of LKF Medical, delivers a number of feisty responses. "People say LKF Medical is a one-product company. I simply answer, so is Coca-Cola," he says.
Isn't medicated oil used only by old people for their colds and headaches? "Young people will get old one day," he says. The market for medicated oil is far from saturated, he adds.
"Lifestyles in Asia are changing. More and more people spend a lot of time on computers and smartphones, which will give them backaches and headaches," Mr Leong says.
The two Asian giants of China and India can drive the firm's business looking ahead. "China has nearly 1.4 billion and India, more than 1.3 billion. The potential is immense," he says.
To hear Mr Leong tell it, his strategy to grow Axe Oil is simple: Keep the product affordable, advertise in ingenious ways, and expand into new countries.
Axe Oil is a blend of eucalyptus, camphor, menthol and other oils. With each bottle retailing in Singapore for less than a dollar and as volumes continue growing tremendously over the years, prices need only be increased very marginally, he says.
The product formula also does not need to be tinkered with. "If you change it, other people will think your product is an imitation." Savvy marketing has benefited the firm tremendously throughout its history.
LKF Medical, or Leung Kai Fook Medical, began in 1928 when Mr Leong's father Leung Yun Chee emigrated from China to Singapore and met a German physician called Dr Schmeidler.
The doctor shared his recipe for medicated oil, which could relieve all kinds of discomforts in the humid tropical climate. Impressed, Mr Leung founded LKF Medical to make and sell the oil.
The initial going was tough. Faced with intense competition from other brands from Hong Kong and China, he devised numerous strategies to market his brand. For a start, the axe was used as a symbol as it was recognisable by households, which had to use an axe to chop wood for cooking fuel.
To pitch his product to medical shops, Mr Leong would dress up in a natty Western suit and employ a uniformed chauffeur to drive him around in a limousine. Shopkeepers would come out to talk to him, thinking he was a prominent businessman.
Mr Leong also distributed pamphlets with famous stories on one side and Axe Oil advertisements on the other. He made use of promotional items like calendars and free samples. He even started newspapers, including evening paper Shin Min Daily News in 1967, to promote his product.
It was from the 1960s that Axe Oil began to expand beyond its Singapore and Malaysia markets. A milestone was breaking into the Middle East by targeting the haj (pilgrimage) market. Mr Leong and his older brother, LKF Medical chairman Leong Heng Keng, would go aboard ships sailing to Saudi Arabia and distribute a few thousand bottles of Axe Oil.
The oil became useful to sufferers of seasickness and headaches. Soon after, LKF Medical began exporting to the United Arab Emirates, Saudi Arabia, Kuwait and Bahrain. By the 1980s, Axe Oil was sold in China and African countries such as Kenya and Nigeria.
Each time the company expands, one key question is how best to market its product. Radio and airline advertisements are common. It also needs to find suitable distribution agents.
"Today, adding a new country is a milestone," Mr Leong says. "We have been in Uzbekistan for a number of years now. We went into Iraq in 2015. This year, we just found an agent in Nepal, a new agent in the Philippines, and we are getting enquiries from Bangladesh."
A third generation emerges
The Leong family is now in the midst of finalising its succession planning. A third generation, the sons of the five second-generation brothers, has been working in the business for some time. The family constitution is being worked out, Mr Leong says. "All these years, the family has worked well with each other. We discuss everything together, and everybody has a part to play," he adds.
"There are so many cousins in the third generation, they are all very qualified, with MBAs (Master of Business Administration), and trained as doctors and lawyers," Mr Leong says. "They'll be able to carry on the business and make LKF Medical prosperous."
Despite being in business for almost 90 years, LKF Medical will continue expanding across the world, holding true to its values of making an affordable and effective cure-all bottle for everyone, Mr Leong says.
"We are very proud that LKF Medical's Axe Brand Universal Oil has carved a name across the world. Our logo has blue and green. Wherever there is sky or land, you'll find Axe Oil."