How Hoe Hin leveraged unique promotional practices such as hiring celebrity spokespersons, sponsoring care ...
In the old days, Gan Fock Wai’s father had good connection with many Cantonese opera artists and movie stars such as Sun Ma Sze Tsang, Chan Po Chu and Wu Fung. He even pledged brotherhood with top film directors who were happy to allow Pak Fah Yeow billboards to appear in their movies, as a way to promote the product brand. Back then, a lot of Cantonese opera artists and movie stars loved using Hoe Hin products. Those who are still alive today remain very supportive to Pak Fah Yeow. In the 1970s, Hoe Hin invited Teresa Teng to serve as Hoe Hin’s Charity Queen. Teresa was about 17 years old at that time and had just come to Hong Kong for further development not long after she started her career in entertainment. Gan Fock Wai knew Teresa well and the two young people had played table tennis together when Gan was in Primary Five and Six. Gan Fock Wai thought his father had a very good business mind and used a lot of progressive ideas to successfully transform a simple medicated oil into a best-selling brand. In order to successfully market Hoe Hin products such as Pak Fah Yeow, Gan Fock Wai began trying out new ways of promotion. To this end, he put more emphasis on repositioning Pak Fah Yeow as a multi-purpose product whose usefulness went far beyond that of regular pharmaceuticals. In expanding its uses, Gan Fock Wai explained that if Pak Fah Yeow was marketed as a medicine, people would use it every time they felt unwell because of headaches, mosquito stings or insect bites. Going beyond a purely pharmaceutical positioning, Gan Fock Wai told people that Hoe Hin’s star product could be used to refresh the complexion, relieve emotional tension and even soothe heat stroke or dizziness while one waited for the bus or did the Christmas shopping! In Hong Kong, Hoe Hin had registered Pak Fah Yeow as a proprietary Chinese medicine. While it focused on the product’s extensive applications in its promotional efforts, the company never exaggerated its curative effects. Gan Fock Wai hoped to expand the uses of the brand so that consumers would pop a bottle in their purse or pocket to take with them for their own use or even help others while out and about. Examples of the latter type of usage could include giving some Pak Fah Yeow to a stranger in the street who was feeling discomfort or heat stroke. Emphasising such versatility was a sure way of helping to increase sales. Gan Fock Wai describes that he had inherited his father's practice of never forgetting to convey a positive message in Hoe Hin’s promotional materials. About 10 years ago, Hoe Hin launched a series of TV commercials which were on show immediately before the news reports on two free-to-air local TV stations. Each day Hoe Hin sent a message featured a slightly different jingle such as “Letting Go Is Happiness”. The company also sponsored 13 episodes of Commercial Radio Hong Kong’s popular Spiritual Environmentalism programme. Occasionally, Gan Fock Wai hosted the show himself, inviting different guests to share uplifting spiritual stories and their wise advice about life. Many years ago, Gan Fock Wai served as the lead singer on popular Hoe Hin commercials, such as “Go Fly”. Four years ago he returned to the recording studio to record “Love 80 Years More” to celebrate Hoe Hin’s 80th anniversary. Beginning in the 1980s, Gan Fock Wai had released several albums, initially singing for fun. He later learned to love music even more and began using it to convey positive messages. In last Lunar New Year Fair, Gan Fock Wai sold an album called “Music Recycle” to raise charity funds for Friends of the Earth. The album mainly featured him re-singing old songs aimed at reminding fans to recycle and reuse. The song “Go! Go! Go!” was intended to convey a message about the environment. Gan Fock Wai later planned to record a new album on behalf of the Society for Abandoned Animals to help call for the better protection of animals.
Pak Fah Yeow as a Family Formula
The formulation was based on weight. Ingredients were measured on old-style balancing scales. Ingredients included menthol, camphor, lavender, eucalyptus, peppermint, etc. They were imported from around the world including Australia, China, India, etc. The formula remained largely unchanged to maintain the same smell of Pak Fah Yeow. Yet the company gave up some potential markets due to the restriction by the local government against certain chemical components. Gan preferred to keep the same formula because otherwise it would no longer have the unique smell of Pak Fah Yeow. The mixing of the ingredients used to be carried out only by Gan’s grandfather and grandmother at the back of the house. This ensured the formula to be kept as a secret from the workers. Modern technology allows a close prediction of the formula by chemical assay, so now building up a good brand name is of greater importance.
Pak Fah Yeow participation in the Product Exhibition
Gan’s grandfather mainly used the trade fair (products exhibitions) to build up the image of Pak Fah Yeow. Pak Fah Yeow was an active participant in the trade fair from the 1950s to 1970s. Gan’s grandfather targeted at the general public to promote the product. He was eager to win the first prizes in the fair to increase the brand’s popularity. He tried to build the biggest and the most eye-catching booth in a traditional Chinese style with good lighting. He also knew a lot of movie actors and actresses so he engaged the actresses as charity queens at the booth for promotion. The charity queens did not parade on stage, they just stood at the booth and collected votes from visitors. He always managed to win most of the titles: the best booth design and the best charity queen representative of Pak Fah Yeow. He also gave away free gifts such as hot water flasks and doll-shaped-bottle editions to bigger buyers. The aim of participating in the trade fairs was not for the sales profit but for the exposure to the public.
Upbringing, Family Background and the Start-up of Pak Fah Yeow
Gan Wee Sean was born in Penang in 1946. His grandfather was born in China and his grandmother was born in Singapore. Gan’s grandfather started the Pak Fah Yeow business in 1927. The business was started in the same premise where the family was living in Penang. The place was rented at a low rate. The formula of Pak Fah Yeow was initially intended for uses among family and friends only, but as it grew popular among the people, Gan’s grandfather turned it into business. The sales expanded in Malaysia and later to Singapore. In the 1950s, as Gan’s grandfather saw the potential of the Chinese market, he moved the operations to Hong Kong because of her proximity to China. The company was registered in Penang as a private company. Together with the trademark, they were named after Gan’s grandmother as Hoe Hin . At first she was the sole proprietor of the trademark but she later sold it to the company. Gan’s grandfather used to tell a story of a German professor giving him the formula of Pak Fah Yeow, but Gan believed that the formula should have come from his grandmother’s or great grandmother’s side. Like other medicated oils, Gan believed the formula originated in Malaysia and was not likely to have derived from Chinese medicine.
The Operation of Pak Fah Yeow at early stage: manual production, simple instrument, family workers
The earliest manufacture of Pak Fah Yeow was purely manual. Around 10-20 workers sat around a long table, and a few hundred dozens of bottles were produced in a week. Menthol crystals and camphor tablets were broken into smaller pieces and put into big wine jugs, dissolved in oil and then mixed and shaken by hand. Then the oil was sucked up and filled into small glass bottles using injection syringes. The paper package boxes were folded and glued by hands. Until today the shape of the bottles used at that time remained unchanged. When Gan was in primary school, he helped out as a small boy after finishing schoolwork. The operation was on home-made scale and did not demand much skill. Workers were mainly family and relatives. Most were women workers, while male workers mainly did the heavy work.
Continued development of Pak Fah Yeow: Expansion of sales to Singapore, building up brand image in Hong Kon...
Before the operations were moved to Hong Kong, the factory had been in Penang only. Products were shipped to Singapore for sale. The factory in Hong Kong was first started in King’s Road, which was later moved on to Electric Road and subsequently to Hennessy Centre above the former Chinese Emporium. The place was later sold to the emporium and the factory was moved to Zung Fu Industrial Building in Quarry Bay. Gan also started a branch factory at Westlands Garden at Quarry Bay to guarantee continuous production in case accidents like fire or water suspension might jeopardize the whole production and the company couldn’t afford it. Yet later the government reclaimed the land of Westlands Garden for development. Both operations at Quarry Bay were then sold and merged into one operation in Paramount Building at Chai Wan. Gan’s grandfather worked much on building up the brand image in Hong Kong. He joined the Chinese Manufacturers’ Association and actively participated in the past product exhibitions. He engaged movie actresses to promote the product and did a lot of outdoor promotion. In the old days, people could sell a product on the street by performing Kung Fu strokes. Gan believed that for a product to be successful, marketing strategies, adequate pricing and the effectiveness of the medicine were equally important factors.
New developments in Hong Kong
When Gan Wee Sean came back to Hong Kong from his studies in the UK, the factories and office were already at Hennessy Centre. Machines were employed for mass production. The manufacture was semi-automatic. The oil was manufactured in bigger drums and the weighing machines were more advanced. The oil was mixed with big stirrer and filled into bottles with electric compression chamber. (Editor’s remark: “Compression pump” was used by the Interviewee but “vacuum pump” should be a more proper name. ) The capping, labeling and carton- packaging were still done by hand. Later when the operations moved to Chai Wan, the production were further automated. Since larger bottles had to be protected with bubble packs, the packing process remained manual. Even today packing is still done by hand. When the production was done in Penang, Pak Fah Yeow was already sold in Hong Kong but by other company. Gan suspected that the products were taken to Hong Kong from Singapore through private channels. Gan’s grandfather visited Hong Kong in 1950s and saw the potential of the Chinese markets. He saw Hong Kong as a good port to produce and supply the products to China. In addition, Hong Kong herself had good market potential as the sales in Hong Kong were one of their largest. Gan’s grandfather decided to move the operations to Hong Kong in mid 1950.
Memories of Hoe Hin’s Hennessy Road factory and early production processes
As a child, Gan Fock Wai occasionally came to visit Hoe Hin’s Pak Fah Yeow factory. At that time, the plant was located on the third floor of the present Hennessy Centre in Causeway Bay. After the factory moved out, its floor was taken over by a department store and eventually became a food court. Pak Fah Yeow’s iconic signs can still be seen on the exterior walls of the Hennessy Centre to this date. At that time, the production processes of Pak Fah Yeow were so simple that even a child could carry them out. The specific steps included injecting the medicated oil into bottles by syringe, immediately screwing on each bottle’s cap and then folding the printed cardboard packaging into boxes. Gan Fock Wai helped out at the factory when he was just aged 6 to 7. To make his time there more enjoyable, he turned humdrum tasks such as injecting medicated oil into bottles with a syringe into games and competed with workers to see who could fold boxes fastest. Gan Fock Wai knew that many Hoe Hin workers retired at a very old age, but he had never heard of any of the company’s workers having occupational diseases. No matter whether the Hoe Hin factory was located in Causeway Bay or Quarry Bay, its production lines always produced a fragrance! When the plant’s windows were open, the scent would fill the neighbouring streets! Today, Hoe Hin’s plant has different clean rooms to filter odours, and has an ventilation system to purify the air. The current plant also utilises an enclosed design which stops aromas from spreading to outside the plant. As a more eco-friendly note, the plant processes waste materials according to environmental regulations and insists that all waste is recycled by waste management companies.
Pak Fah Yeow in the 1970s
In the 1970s, the office was shared by six people including Gan Wee Sean, Gan’s grandfather, one director, an accountant and a Chinese clerk. There were about 30 workers in the factory at Hennessy Centre. The production rose to 12,000 to 24,000 pieces per month. The production procedure remained largely manual except for the steps of filling, wrapping and carton-packaging. Promotion was mainly outdoors with very little use of TV commercials. The biggest promotion every year was at the trade fair (or products exhibition). The products were distributed by eight major Chinese medical halls in Hong Kong. Gan’s grandfather wanted to maintain good relationships with the eight owners so that he could benefit from a wider coverage of distribution through the different networks of these distributors. In 1991, the company changed from a family business to a listed company, although still under family control. He believed his grandfather would not have agreed with listing the company.
The origin of and changes in Hoe Hin’s Pak Fah Yeow formula. Factors affecting the procurement of natural ...
While there are several stories about the origins of Hoe Hin’s Pak Fah Yeow formula, no one knows which – if any – is true. One version has it that the formula was handed down by the family of Gan Fock Wai’s father's first wife, Low Khoon Choo. While still a boy, Gan Fock Wai also heard different versions from his father. They included a story about getting the formula from a friend whom Gan’s father got to know on board a boat while travelling overseas to sell biscuits. Another version says that Pak Fah Yeow’s formula was passed from Gan Fock Wai’s grandfather to his father. Over the years, Hoe Hin made very few changes to its Pak Fah Yeow formula. The formula for white flower products to be exported was modified in order to comply with the regulations and specifications of the different regions for whence it was headed. In the Colonial past when the British still ruled Hong Kong, they did not control traditional Chinese medicine and many export regions did not regulate such products. Today, Hong Kong has implemented a stringent registration system for Chinese medicines. Countries around the world have different regulations for regulating traditional Chinese herbs and natural herbal lotions, potions, creams and infusions, etc. Nowadays Hoe Hin also complies with the latest pharmacopoeia standards when procuring different natural raw materials each year. Taking lavender oil as an example, Pak Fah Yeow once used to feature synthetic lavender oil, but now complies with the latest British Pharmacopoeia standards governing the procuring of such oils. In buying natural raw materials, Hoe Hin insists on globally-recognised pharmacopoeia standards. Specific examples include the Chinese, British, U.S. and European Union Pharmacopoeias. The aim is the constant improvement of its products’ quality. The natural raw materials that Hoe Hin uses are all purchased overseas and many factors are considered before importing into Hong Kong. Nowadays, the price of natural raw materials are very high due to many different reasons. Pollution causes climate change, affecting cultivation and leading to soring prices of many natural products. For example, when the Australian weather becomes increasingly dry, locally produced natural raw materials diminish in quantity and the prices rise. As a result, farmers prefer to grow agricultural products that are easy to sell and can make profits. To this end, they grow fewer medicinal plants such as mint, causing prices to rise due to the short supply of medicinal plants. As the prices of such plants increase, there are farmers who switch to grow medicinal plants to meet demand. Even so it may not be able to relieve the problem because it takes time for the soil to become suitable for growing medicinal plants within a short period of time. Other factors such as excessive harvesting of wild cordyceps sinensis causing desertification, affecting agricultural harvests and also pushing up the prices of natural raw materials. U.S. dollar exchange rate fluctuations, inflation, metal prices, energy charges and other factors such as the cost of producing glass bottles, plastic caps and packaging all have direct impacts on prices. Each variance has a “knock on” effect that affects prices at every stage of the production chain. Aside from directly importing from Australian farmers, Hoe Hin generally imported raw materials through intermediary trading companies. Gan Fock Wai believed that for Hoe Hin to achieve sustainable development, it would have to put sound environmental protection measures into practice and make every effort to protect the natural raw materials. He hoped that in addition to achieving Good Agricultural Practice (GAP) compliance, Hoe Hin would also adhere to the principles of fair trade in its future sourcing of raw materials in order to protect the livelihood of the farmers who produced them.
