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A promise to deliver
STEP into the Automobile Megamart in Ubi, and the potential car buyer might be inundated with choices. There are already more than a dozen showrooms for brand new cars on the first floor, and dozens more parallel importers, used cars dealers, and car service providers in the rest of the eight-storey building.
But one name stands out for being one of the oldest and most well-known players in the trade. That is Leco Auto, a 41-year-old company which has transitioned successfully from its early days as a used-car dealer to become one of the biggest parallel importers of new cars here.
Leco is one of the few companies in Singapore that directly imports the popular Toyota and Honda brands directly from Japan. Parallel importers like Leco can offer cheaper and different models compared to that offered by authorised distributors of the two vehicle brands, which get their cars from factories in neighbouring Thailand.
"The Japanese have very stringent quality control. We believe their build and quality is superior over cars imported by authorised agents," says 70-year-old Leco founder and chairman Ng Hoy Keng, who is running the business with his 35-year-old son, general manager Cobin Ng.
Customers seem to agree. Leco is selling around 500 new cars a year. It gets a substantial part of its business by word of mouth from satisfied customers.
Mr Ng says in Mandarin: "We compete on our brand, our integrity. Our service must be good. Customer referrals are very important. And when we sell, we always deliver. Even if we make a loss on the vehicle, say the Certificate of Entitlement (COE) is too high at the point of sale, we will still sell. To do business, we must dare to make money, dare to lose money."
The quality of Leco's after-sales customer service is also critical to Leco's success, the elder Mr Ng says. Salesmen are trained in the technical specifications of the various cars, and answer any customer queries diligently after understanding the situation.
"When we deliver to the customer, sometimes we will take one hour to explain. Sometimes they cannot figure out how to start the car, how to shift its gears. We must explain clearly. Nevertheless, for Japanese cars, their technology is very good and we seldom have problems," he says.
The customer comes first
The old business adage of putting the customer first is easy in theory, but far harder in practice. Mr Ng cites the example of a customer who bought a new BMW from him two to three years ago, but kept complaining about how the steering of the car was not stable. Various checks on the balance and alignment of the tyres did not resolve the customer's problems.
"He called me five to six times, every time I was having breakfast. Finally I offered to buy the car back from him at the same price that he bought it at."
But the customer checked his finances and decided finally that the problem was not so serious that he had to get back a full refund, and pay some financing costs.
"I have not heard from him then. But my point is that we have to fulfil our promise to serve the customers. It gives them confidence to buy a car, and builds our reputation in the market."
Serving customers well is the proper way to do business because customers can be retained and new customers won over, Mr Ng says. "What makes me proud is that in our 40 years of operations, we have not fought a single lawsuit with our customers."
A journey of hard work
Born in a Punggol kampong, Mr Ng says he was lucky to receive a university education. His father ran a provision shop in the market, and as Mr Ng was number six among eight siblings, he did not have to support the family. His interest in cars was piqued after he visited a car expo in 1970 in Osaka, Japan. He then joined the former Asia Motor, which used to be the authorised distributor of Mazda cars, as a showroom salesman.
Within three months, he was promoted to become supervisor, and soon became assistant manager. "I was hardworking and did well. I sold a lot of cars," Mr Ng recalls.
In 1975, he struck out with a few friends to start Leco, which was then managing vehicle financing and insurance. Leco also exported old cars to neighbouring markets like Batam, Malaysia, Brunei, New Zealand and Australia. It then expanded to Sri Lanka and found a large market for Peugeots, Volkswagens, Audis, and Austins. In good months, he could export hundreds of cars a month.
In the 1980s to 1990s, Leco became one of the biggest used-car exporters in Singapore. It expanded its business to places like Thailand, Cambodia, Myanmar, Vietnam, and China.
Mr Ng, who is Chinese-educated, credits his English-educated wife, Lim Lee Ang, for helping him with much of the business. "She would work till late at night. Not many people could do used-car exports then as you needed to handle customs and administrative procedures," he says.
A business transformation
Then the 1997 Asian financial crisis hit and the Indonesian rupiah, the Malaysian ringgit and the Thai baht depreciated significantly in value. Mr Ng pulled out of these markets and decided to switch his business to doing parallel imports. "Then, things weren't so competitive, there were only six or seven companies. Today there are hundreds," he says.
Over the next 20 years of hard work, customers have gained confidence in Leco's parallel imported vehicles, he says. Leco gets most of its business from selling Toyotas and Hondas, and it also imports continental cars like Mercedes-Benz and BMW.
Today, Mr Ng is semi-retiring from the business to let his son Cobin, who has been involved since his teenage years, to take over. Mr Ng is still actively involved in community and association work. The most notable is his leadership role in the Teochew business community as the first vice-president of the 170-year-old Teochew club Chui Huay Lim. He is also the chairman of apparel provider Augment International, which distributes sports and lifestyle brand Kappa.
Looking ahead, Mr Ng says business has been picking up as COE prices have come down, making new cars more affordable. "The industry depends on government policies. Business will be good if the number of COEs goes up," he says. "There are more competitors coming up, but as the market leader, we will compete as we always have: Through our integrity, our commitment, and ensuring the customer comes first."