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MANILA — Sammy Lim doesn't want to be the biggest furniture retailer in the Philippines. He wants to be the biggest in Asia.
And he believes he can do it by "reinventing" Ikea, taking the international furniture chain's concept back to where it was decades ago.
Lim is director of the Chamber of Furniture Industries of the Philippines and heads Blims Fine Furniture, a furniture retail chain whose history goes back to the 1890s when Lim's Chinese family sold furniture to Spanish and Portuguese priests.
Lim's background is varied. By the early '40s, Lim's family owned the three largest furniture store groups in Manila, only to have them destroyed in the war. By then, the electronics business was starting to bloom, and the company rebuilt as an appliance and furniture business, becoming the largest chain in the city.
"Being from a Chinese family, I had always worked at the store even from a child," Lim said. "I wanted to do something new. So in 1977, I established the largest one-stop furniture center in Manila."
Since then, Lim has had a number of jobs, many of them in government. He has been the deputy minister of trade for the Philippines, has headed the National Development Corp., which invests in corporations, and is the founder of the Philippine Franchise Assn. which grew from 40 members to 600 in the six years Lim held that post. Lim also formed a partnership with Gold Star to manufacturer electronics and teaches retailing and franchising at the Asia Institute of Management.
Borrowing the Ikea idea
Lim, during an interview at the recent furniture exhibition in Manila, said that in face of competition from other Asia countries, it's time to approach the world market differently. His strategy may not be new in the United States, but that may be a different thing in Asia. "There are too many small players," he said. "It's time to consolidate, or at least to cooperate or syngerize to form a strategic alliance."
That's what Lim would like to see the manufacturing industry do. And that's exactly what he plans for the furniture retail business.
Lim is traveling the globe these days with his eye on seeing what makes companies like Rooms To Go so successful. Eventually he plans to return to Manila and put these ideas into practice. And, from a retail standpoint, he believes his part of the world is ready for it.
"Furniture has become a side business of real estate developers who don't even understand the business," he said. "They'll build a mall and in one wing they'll dump the furniture. They are getting the volume but I don't think they are into lifestyle, comfort, those types of things. So I think this is the time to reinvent the furniture business."
Lim would like to follow the concept of selling affordable rooms, not pieces, by showing consumers what an environment could look like. "No longer will they buy one piece, but they will buy eight pieces. You have to couple that with financing. They say, 'My salary's still the same, so how do I afford it?' By payments," he said.
"I was at the Cebu furniture show," he added, "and I saw a lot of beautiful accent pieces. But accents are just that — accents. I just don't think accents are that big a business. I think a big business is selling a lot of pieces."
Levitz, he added, had the concept 20 years ago, and Ikea has it now. But Ikea has moved up in cost so that it's no longer affordable like it once was, he said. Asia has a large population of young people who can't afford pricey goods, and that's where consolidation comes in.
Lim with like to work with about 50 or 60 suppliers worldwide to create a "new" Ikea with the cheapest possible prices — all united under one brand. "I do not hope to be as big or as good as Ikea is today, but I would go back to the fundamentals, the basics," he said. "I think Rooms To Go is doing something like I'm saying."
He said the concept of "slave labor," is over in Asian countries. "With the Internet, they're going to learn pretty fast. So unless there's a long-term partnership (with labor, design, manufacturing, marketing and selling), it's going to be over pretty fast.
Lim said there is strength in numbers under branding. He can choose 50 suppliers in China, Malaysia, the Philippines, the United States., anywhere, and their brands alone won't be as strong as if banded together into one backed by the 50.
"I want to pick 50 to work with me to grow this chain," he said. "We can go anywhere. It's going to be a global company. I want to be the Ikea of Asia."
| Lim |
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