10 success secrets of the Philippines’ oldest distillery

How do we ensure success that will last and outlive us? How do we create or build and manage a business or even an organization that can last beyond three generations, especially if it’s a family-led business in our milieu of high economic growth and frequent political tumult?

Two enduring, family-led conglomerates

I remember a few years ago, at the Makati residence of Endika Aboitiz, SGV Group founder Washington SyCip told me that we members of the ethnic Chinese minority in the Philippines are great natural entrepreneurs at creating new businesses, but our weakness is how to institutionalize success as family corporations that can last more than three generations.

SyCip cited the Hispanic clans of the Zobel Ayalas of the Ayala Group and Cebu-based Aboitizes for managing two family-run conglomerates that have sustained success beyond three generations.

In the case of the Ayala Group, it started out as a distillery that in the early 20th century was sold to Chinese immigrant entrepreneur Carlos Palanca (Chinese name “Tan Guin Lay”) of La Tondeña distillery, but the Ayala firm managed to revive its fortunes again after World War II. 

New product from old firm is Imeldifique

In time for the Christmas season, the country’s oldest distillery — the 163-year-old Destileria Limtuaco & Co., Inc. led by president Olivia Limpe-Aw and husband, senior vice president Benny Aw — recently launched its newest product, Imeldifique Cooking Wine with Ilocano ingredients. The firm’s other popular products include White Castle whiskey and Napoleon VSOP brandy.

Olive’s husband Benny Aw is the son of one of the Filipino-Chinese business community’s respected philanthropists, Aw Peng Lam.

This Imeldifique cooking wine was developed in cooperation with Ilocos Norte province, led by its governor, Imee Marcos, and named after the latter’s mother, Congresswoman Imelda Romualdez Marcos.

The new product idea came from Governor Imee’s approaching Limpe Aw during CITEM’s IFEX 2015 and asking if the distillery could help her province create a product similar to Destileria Limtuaco’s existing Vigan Basi wine. Thus, Imeldifique Cooking Wine came about, which has sorghum spirit as a base and is distilled with China-style Baijiu, then infused with Ilocano  native garlic, onions and salt to get our Philippine “ginisa” or sauté flavor.

Imeldifique’s recent launch at Victorino’s restaurant in Quezon City was attended by Ilocano political and civic leaders ranging from Imelda and Senator Bongbong Marcos to the late Ilocano President Elpidio Quirino’s granddaughter Cory Quirino, Ilocos Sur Governor Chavit Singson, and Ilocos Sur vice governor D.V. Savellano (who also launched his book on Ilocano food heritage, Naimas — co-authored by chef Heny Sison and photographer Neal Oshima — on the same occasion).

Bonifacio Limtuaco, the 19th-century immigrant founder of Destileria Limtuaco and great-greatgrand-uncle of Olivia Limpe Aw

5 generations of family leaders, 10 success tips

Limpe Aw is the fifth-generation CEO of Destileria Limtuaco, starting with founder Don Bonifacio Limtuaco, an immigrant rags-to-riches entrepreneur who established the distillery in 1852. The founder’s only son, Ateneo-educated Carlos, died in the late 19th century, so control passed to the founder’s nephew and Olive’s great-grandfather, Lim Chay Seng, who became the second CEO.

The third CEO was Lim’s son, University of Washington graduate and Olive’s grandfather, the late James Limpe, who became a leader in the Filipino-Chinese business community who resisted the Japanese military occupation of the Philippines and was jailed in Fort Santiago by the Japanese invaders.

The fourth CEO who led the modernization of the distillery in terms of manufacturing and corporate organization was Olive’s father, the late industrialist and painter Julius Limpe.

What are the success and longevity secrets of Destileria Limtuaco & Co., which has been around for the past 163 years? Here is a list culled from our exclusive interview with its president, Olivia Limpe Aw, who is also publisher of the bilingual English/Chinese Asia Dragon magazine:

1. Innovation. Olive Limpe Aw said companies should constantly innovate, not only in terms of products and marketing, but also in business processes.

2. Professionalize operations. After a debilitating 1989 labor strike, Destileria Limtuaco, under the late Julius Limpe, started to rebuild the company by professionalizing operations from that of an entrepreneur-run business into a more corporate setup with the goals of ensuring growth and longevity. The essence of being a family-led business was still in place, but many aspects of the business were professionalized.

3. Consolidate ownership. One of the perennial problems of family-owned businesses is the diffusion of ownership control among succeeding generations of siblings as equal shareholders, then cousins or other kin, often causing instability, deadlocks or collapse. Limpe Aw said, “Ownership of the business should not be too diluted, because there will be problems with leadership, which is usually the reason for the death of many family-owned companies.”

How to consolidate ownership? Aw replied: “My late parents believed that whoever manages the business, she or he must have majority shares in the business.”

I recall hearing of the same setup in two family-led companies: the late Robert Coyiuto Sr. of Prudential Guarantee & Assurance, Inc. reportedly bequeathed majority shareholdings to his eldest son, Robert Coyiuto Jr., who eventually established PGA Cars. Another example is JG Summit Holdings, Inc., with its founder and chairman emeritus John Gokongwei Jr. reportedly bequeathing the biggest chunk of his stockholdings to his son, Lance Gokongwei.

4. Invest in relationships. To ensure the long-term success of a business, cultivate good relationships with various stakeholders like suppliers, customers, employees, investors, creditors, and the community.

5. Be fair in dealings. Limpe Aw said, “If you cheat others, people do not want to do business with you anymore. Being fair is not only good ethics, it is also thinking of long-term business dealings.”

6. Have integrity. “My late parents taught us to invest in our reputation, to take care of our integrity not only as a business but more so as individuals,” Limpe Aw says.

7. Work hard. Aw said that she and her siblings imbibed from her parents the importance of the traditional Confucian work ethic. She said, “Business is not just 9 a.m. to 5 p.m., it is 24/7 or 24 hours daily for seven days. It is not only important to think and plan, but to act and execute plans.”

8. Maintain the hunger. Aw said, “It is difficult for people to maintain the attitude of ‘always having hunger’ or the drive when you’re always full. We should not be complacent.”

9. Have vision. Whether for companies or individuals, we should have long-range vision. In the case of Destileria Limtuaco, Aw envisions the company to last generations beyond herself and that its brands can someday become global brands. They have already started exporting their products.

10. Be passionate and persistent. In order to ensure continuous success and progress, Olive believes that businesses or individuals should have both passion and persistence in whatever we undertake.

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