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Embracing change to stay relevant
BEING a heritage brand with 137 years of history has not stopped Eu Yan Sang from embracing change.
In recent years, the Traditional Chinese Medicine retailer has restructured its operations and introduced new ways to connect with customers to boost productivity and maintain profits.
Eu Yan Sang's managing director Serene Seow said that raising productivity allows the company to offer high quality products which are competitively priced even as business costs continue rise.
"We leverage on technology, innovation, streamline work processes to drive productivity and make striving for productivity the way of business," she said.
The company's efforts to increase efficiency have centred on five pillars: differentiating its products, optimising stores and operations, personalising service, expanding marketing channels and strengthening the brand.
The company has also tapped into technology, introduced new sales incentives and streamlined workflows to drive revenue and manage costs. For example, it used technology to scale up back end support such as warehousing, logistics and head office support without incurring more man hours and cost.
Eu Yan Sang has also used new ways such as digital marketing to connect with customers more effectively. Its target audience and membership base has increased by 40 per cent.
The company's productivity efforts have paid off handsomely. It achieved annual manpower costs savings of S$1.06 million. Revenue went up by 9 per cent this year compared with last year while earnings before interest (Ebit) increased 55 per cent in the same time period.
Ms Seow said that companies need to realise that productivity is a continuous effort, and that it has to be part of their organisational culture.
"The government could incentivise and recognise companies who show marked improvement in key productivity ratios to further drive productivity at the national level and share best practices," she added.