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Carving a name, across the world

One of Singapore's most recognisable products, Axe Brand Universal Oil is now sold in more than 50 countries
Friday, July 22, 2016 - 05:50
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'My vision is globalisation. Our logo has blue and green. Where there is sky, water or land you will find Axe Oil there.' - Leong Mun Sum, managing director of Leung Kai Fook Medical Co (LKF Medical)

SPEAK of made-in-Singapore products, and Axe Brand Universal Oil will take pride of place as a local brand gone big. The little cure-all bottle is now used by people in more than 50 countries around the world, from children in Singapore to pilgrims in Saudi Arabia and villagers in Kenya. Axe Oil has even inspired a number of copycat medicated oil products bearing its distinctive blue-green border.

Leong Mun Sum, managing director of Leung Kai Fook Medical Co (LKF Medical), the company behind Axe Oil, thus speaks of his family's 88-year-old business with pride. "My vision is globalisation. Our logo has blue and green. Where there is sky, water or land you will find Axe Oil there," he says.

While LKF Medical makes a variety of other products, Axe Brand Universal Oil, which contains a blend of eucalyptus, camphor, menthol and other oils, remains its top seller. The oil is used for many common ailments including nausea, rheumatism, upset stomachs, colds and insect bites. "Axe Oil is an effective product, and is convenient to use and affordable. That's why it has survived for so many years," he says.

Prices are kept low, ensuring sales volumes are high. Clever marketing tactics, like advertising on buses, airline magazines and outdoor screens, also help keep the brand in the minds of consumers, Mr Leong says.

A chance meeting

The story of LKF Medical and Axe Oil 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 pair hit it off and the physician shared a secret with the young immigrant: His recipe for a medicated oil to cure all kinds of discomfort.

Mr Leung was impressed. He founded LKF Medical and began marketing and selling this cure-all remedy. The initial years were tough. There were many competing brands from China and Hong Kong. Undeterred, Mr Leung, who had a talent for marketing, began trying to market his oil as being superior to the rest. The axe was used as a symbol, as it was instantly recognisable by households, which used an axe to chop wood for cooking fuel.

To pitch his new product to medical shops, Mr Leung would dress up in a Western suit and employ a uniformed chauffeur to drive him around in a fancy limousine. Thinking he was a prominent businessman, the shopkeepers would come out to talk to him.

Mr Leung and his chauffeur would also distribute pamphlets which had famous stories on one side and Axe Oil advertisements on the other. Sales began to pick up.

During the Second World War, overseas trade ceased and Axe Oil sales were given a further boost as the competition from abroad diminished.

Business smarts

Mr Leung's entrepreneurial spirit knew no bounds. Already in the 1930s, he was making use of promotional gifts like calendars and free samples. In the 1950s, he even started a newspaper to give Axe Oil more prominence.

In the 1960s, Mr Leung began exporting his product to Indonesia, adding a third market beyond Axe Oil's home base of Singapore and Malaysia. In 1967, he founded evening paper Shin Min Daily News, which differentiated itself from existing papers by carrying horse-racing lottery numbers before the others did so the following morning. Local news was also put on the front page.

In 1971, Mr Leung passed away and the business passed to the hands of his eldest son, Leong Heng Keng. A significant achievement for the older Mr Leong was breaking into the Middle Eastern market in the 1970s.

"Many people in Singapore and Malaysia went to the haj (pilgrimage) in Saudi Arabia by boat at that time. They suffered from seasickness and headaches and found the oil very useful," the younger Mr Leong says.

To market the oil to pilgrims, Mr Leong said his older brother hit upon an ingenious idea. He would go to Singapore's harbour to board the ships before they set sail, distributing a few thousand free bottles of Axe Oil each time.

As Muslims around the world went for their religious pilgrimage, word spread about the wondrous bottle of oil. That decade, LKF Medical began exporting Axe Oil to the UAE, Saudi Arabia, and Jordan. Sales kept growing. By the 1980s, Axe Oil was being sold in China, Hong Kong, and parts of the African continent like Kenya and Nigeria.

Revolutionising manufacturing

In 1987, the younger Mr Leong, who had graduated with a Master of Pharmacy from the University of London in 1963, took over as the managing director of LKF Medical.

Before joining the business, he had spent four years working in the UK as a hospital and community pharmacist, and the next 20 years for a major contract manufacturer of consumer goods in Singapore and Malaysia.

"I had to fulfil my father's vision for one of his sons to become a pharmacist to have an authority around when factory inspectors came. I also had to gain experience in how to run a corporation," Mr Leong said.

Once in charge, Mr Leong upgraded the manufacturing lines of LKF Medical even more. He also ensured compliance with various manufacturing standards. LKF Medical became one of the first medicated oil producers in the world to obtain the ISO-9002 quality control certification.

Today, it has five Good Manufacturing Practice-certified (GMP) factories in Singapore, Malaysia, China, Indonesia, and Vietnam. Its production lines in Singapore can produce more than 100 bottles a minute.

A global firm

In the 21st century, LKF Medical's business has gone truly global. The latest markets in the last 20 years include places like Vietnam, Cambodia, the Philippines, USA, Australia, and more recently, Romania and Greece.

Meanwhile, the third generation of the family has entered the company, armed with corporate experience and Master of Business Administration (MBA) degrees. Looking ahead, the company plans to extend its product range. It is also working with local universities on new projects. The future of Axe Oil is bright, Mr Leong says.

More and more countries trust Asian herbal preparations as an alternative to Western medicines. And with many people spending a lot of time in front of computers and smartphones, they tend to suffer from headaches, neck and back pain. Axe Oil will come in very handy, he says.

Above all, Axe Oil will continue to expand to new markets, fulfilling the dream of globalisation and taking the venerable business to greater heights. "It was not easy to expand to over 50 countries in the world. I am very proud."