The business community is most likely familiar with the David and Goliath allegory of Cecilio Pedro’s Lamoiyan Corporation versus the multinational giants. How local brand Hapee Toothpaste, born from adversarial circumstances, battled it out with global brand titans like Colgate and Close-Up, and gave them a run for their money. The achievement was so incredible and impressive that Harvard University invited him to speak at a conference of Asian business leaders, and then dispatched a team to the Philippines to conduct a case study of how a local entrepreneur was able to tap a market dominated by big multinationals. Today, Hapee is an even stronger No.3, nipping at the heels of the bigger-spending mega-brands and beating its competitors in NCR!
But this isn’t the most amazing part of the story. What is more inspiring is how despite battling multinational giants, Cil Pedro has remained… well, a nice guy, once again disproving the notion that only the ruthless can succeed. Leaders with exceptional self-awareness often wonder whether the drive to the top will shrivel their spirit or make them lose their soul. In their own journey, both Bill Gates and Warren Buffet have converted to “creative capitalism” or giving back to the community. Greed is slowly giving way to the “decent” profit as the corporate conscience awakens to its social responsibilities. Cil Pedro has known that all along. He has always operated on the fundamental principle of sharing wealth for the greater good.
In 1985, when plastic laminated toothpaste tubes were introduced, Aluminum Containers was left with no customers. Pedro and his partners had made substantial capital investments. To close down would result in massive financial and job losses. It was not an option. So he thought, “Maybe it’s what God wanted me to do here in the Philippines. I told Him, ‘You closed down my factory, maybe you want me to produce.” That started my dream of making my own toothpaste to compete with the giants.”
Rather than fold up, Pedro decided to turn the factory around, refitted the equipment and came up with affordable toothpaste brands to compete with the big names. He kept his faith. Two years later, the Hapee and Kutitap toothpaste brands were born under its new name, Lamoiyan Corporation. (Lamoiyan is the Cantonese name of his late grandmother — the first Christian in their family.)
Selling Hapee at 30 percent lower than the competition easily landed it the No. 3 spot in the market, behind Colgate and Close-Up. Lamoiyan was encouraged to add to its product lineup. From a family corporation managed by Cil and his wife, Irene, the burgeoning business has since hired professionals in its ranks. Diosdado “Ding” Salvador, former president and CEO of Johnson & Johnson in Asia Pacific, joined as managing partner. He is steering the expansion of Lamoiyan’s local brands into major players, diversifying the toothpaste variants and going into other consumer product categories. Together, the team, which now includes Joel Pedro, the only son of Cil and Irene, hopes to bring Lamoiyan to greater heights. Pedro looks to expanding their reach throughout Asia, particularly China, Vietnam and Indonesia. His ultimate goal is to make Hapee the leading brand in the entire continent. “Things are moving ahead. We’re very optimistic that in the next five to 10 years we should be all over. It’s another level,” he said.
But now the major players are getting disturbed. “Unlike before, when we started, this was just a small company, they weren’t paying attention. Today, we’re a threat to them. It will be tougher, but I believe in the capabilities of Filipino talent. We’re very good; we can compete with the best in the world.”
Cil Pedro was never the regular dyed-in-the-wool businessman consumed only by making a profit. He deeply believes that every company has a social responsibility to do their share in easing the social injustice in our society. “I found out that people are looking for companies with values and CEOs that care, not just for making money, but to help the community, reach out, give and bless others.”
A devoted member of the United Evangelical Church, he chairs the board of the Deaf Evangelistic Alliance Foundation, Inc. (DEAF), which helps the hearing-impaired with employment and skills training. DEAF provides free college education to at least 200 deaf-mute students, and has established several centers throughout the country that teach some 1,000 students sign language. Lamoiyan is committed to providing employment and housing to 30 disabled students who graduate from high school every year. “They’re given first priority in our company, and we help them find jobs in other companies that are related to the church.” For his philanthropy, Pedro was recognized as a “social entrepreneur.” In 2004, Ernst & Young, the international accounting and auditing firm, honored him with the award for Socially Responsible Entrepreneur of the Year.
He has made it a personal mission. “In my public speaking and outreach programs, I see to it that this is part of my campaign; to reach out to the poor and inspire a generation of new leaders that will be taking care of their fellow man; that will be sharing and caring and believing in God, to make this country a better place to live in.”
He attributes the appeal of his products not only to quality and reasonable price, but also to the social values and advocacy of Lamoiyan. “Many of our competitors don’t value relationships; for them it’s survival of the fittest,” he says. “Of course we value price and cost, but on top of that we add the human dimension. It’s no longer just the product, it’s the company behind the product and it’s the people behind the company.”
He adds: “It’s also the packaging, the way we promote the product, the way we deal with customers, with our distributors, our suppliers. We are selling 20 to 30 percent lower, so we have to see to it that we get the best product, the best raw materials at the best prices. How do you get that? You have to deal properly with your suppliers. They have to trust you, develop confidence in the relationship. It’s out of the box, maybe, but we treat our suppliers like family members, like partners, like friends. In return, they give us special terms and prices, and that way, we can compete.”
In the end, he believes that it’s the Filipinos themselves that can help our country. “I believe in the world-class Pinoy,” he says. “We’re sending so many professionals outside the Philippines, but here, how come we can’t do it? Why can’t we help ourselves move? If they can do it abroad, why can’t they do it here? That’s what’s pushing me. I believe in the Filipino’s ability to succeed.”
With his faith in the Filipino and strong religious convictions, he sees a good future despite the challenges. He disagrees with those who think the Philippines is a hopeless case. “We’re lagging behind our neighbors in Southeast Asia like Malaysia, Thailand, Hong Kong, Singapore, and even to a certain extent, Indonesia. Now Vietnam is coming in. We should compete, train, educate our people — they have the talent and capabilities to be the best. Why not stand up, join our efforts to come together to make our country strong again?”
Most business leaders credit their success to a formula of hard work, acumen and profit strategies and targets. Cil Pedro runs his business with a work ethic that is based on faith, hope and charity. He shares the stage with Tony Blair and CJ Art Panganiban in the Leadership Conference at 2 p.m. today in the Sofitel Harbor Garden Tent. Cil Pedro will share his thoughts on how small local companies can negotiate a global recession without losing themselves.
Tickets might still be available at TicketWorld.
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